I’m not an intellectual property attorney, but I know a lot about software patents. Shanghi Zhizhen, a company also known as Xiao, alleges that Siri infringes their patents. They seek to prevent Apple from selling products in China that infringe the patent and $1.4 billion in damages. As with most patent disputes, the parties disagree about both the validity of the patent and whether infringement has occured. Chinese courts have made various rulings on both topics and the dispute is ongoing.
No matter the merits of this particular case, the irony is deafening. Everyone but the Chinese acknowledge their systematic, long-standing intellectual property theft from American companies. It’s hard to quantify the scope and value of that theft, but the estimates range from $225 billion to $600 billion per year.
Although piracy and counterfeiting remain issues in China, the two newer forms of siphoning off foreign IP value are theft—often cyber theft—of extraordinarily valuable trade secrets and know-how, and the technology transfers required of American and other foreign companies as a condition to doing business on Chinese soil. Traditions of territoriality and sovereignty, as well as the willingness of foreign companies to trade IP for access to the Chinese market, give the latter a degree of legitimacy that outright industrial espionage lacks.
Against that bleak backdrop Yuan Hui, CEO of Xiao, asserts:
As a tech person, I have a lot of respect for Apple, whose products and services bring a lot of value and experience to the world…But customers are paying for every Apple product. In turn, Apple has to respect innovation. They use our patents, they need to pay us a reasonable fee.
It could totally be that Apple is legitimately infringing Shanghi Zhizhen’s patents. But systematic intellectual property theft tarnishes every Chinese company, no matter whether they participate or benefit. When I read Yuan Hui’s call for respect, all I can think of is Cartman:
Respect is earned, not demanded.