You have probably heard of KFC. But in the internet lexicon, that catchphrase does not refer to the famous US fried chicken chain. It represents the initials of the slogan: “Kaobei (the pinyin for copy) from China”.
Clearly, the country’s shift from creating so-called technology clones to a genuine innovation powerhouse is no longer an aspiration, but a fact.
Case in point: Chinese e-commerce players not only generate big numbers in sheer transaction volume online but reshape the manufacturing process based on personalized needs and move to revamp physical retailing. This would help them gain an advantage over international rivals such as Amazon and eBay, which have just put stakes in this area.
Also, mobile wallets, initially designed to facilitate online transactions alone, have now penetrated civic services and wealth management, streamlining administration and enhancing efficiency. The likes of Alipay and WeChat Pay would not have envisioned to expand into a territory in an unprecedented scale and depth that was once dominated by the government and the elusive financial sector.
Indeed, China is already more digitized than many observers appreciate and has the potential to set the digital frontier in the coming decades.
Digital economy－one that features the use of the internet, cloud computing, big data, artificial intelligence in a variety of sectors－would contribute to 70 percent of the newly-added economic output this year. According to Tencent chairman Pony Ma, the digital economy will be key to helping China become a leading world power and enter the fourth industrial revolution.
Such ambition is best exemplified by numbers. According to global consultancy McKinsey, China is among the top three in the world for venture capital investment in key types of digital technology, from virtual reality, robotics to autonomous driving and 3-D printing. It dwarfed the United States as the biggest retail market last year, and seized a whopping 40 percent of global e-commerce transactions, up from a mere 1 percent a decade ago; One in three of the world’s 262 unicorns (startups valued at over $1 billion) is Chinese, commanding 43 percent of the global value of these companies.
The list may go on, but the potential remains huge. Boston Consulting Group predicts that China’s internet boom is likely to gather pace on the back of widespread mobile connectivity, the ability of China’s biggest internet players to innovate quickly and its massive number of internet users who are keen to try out novel digital applications.
Among all these factors, government support is the key. As the export-led manufacturing model will inevitably run out of steam, new wealth and sustained growth can only be achieved from the innovation of industry through the application of information technology.
By mapping out plans and introducing incentives, the government has played an active role in building world-class infrastructure to support digitization and further drive the sector’s development.
With the mantra of every corner in China today being “innovation” and “entrepreneurship”, people have come to enjoy the perks of receiving parcels within 12 hours of an order being placed, unlocking a shared bike with a phone, and paying with your face at a cashier-less coffee booth.
Apart from subtle enhancements in life, internet has taken on more noble undertakings. Companies help farmers peddle their produce through e-commerce platforms and predict sales using algorithms and data analytics. Alibaba said 33 million people have thus become self-employed using its platforms, which is in line with the broad national goal of poverty reduction.
Besides, Beijing has envisioned linking up its manufacturing and infrastructure through the resource and logistical efficiency enabled by the internet. Major cloud operators are building industrial big data platforms for Chinese manufacturers that can connect their facilities globally. Using predictive analysis, such platforms can detect, avert or tackle glitches in real time, improving efficiency.
Finally, Chinese are conferring internet business models and know-hows to foreign players. From Singapore to Seattle to Sydney, consumers celebrate online shopping sprees, swipe virtual credit cards and ride shared bikes that all contain the Chinese gene.
Internet has indeed made the world flatter. China’s experience show that it can be harnessed to enrich, enchant, entertain and empower a society, and perhaps beyond.