China’s online revolution is growing and India is nowhere close

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By Bose /  16 Feb 2012 , 18:54

Everything about China comes supersized – and in superlatives: the biggest, longest, highest and so on. In a country of 1.3 billion people, any which way you slice and dice the numbers, you’ll have plenty to go around.

But exactly how does one account for China’s mammoth population of Internet users and the extent of innovation that one has seen in the country, given that China is a one-party state with strict censorship in place. For instance social media platforms like Facebook, Twitter and YouTube are blocked in China.

How does China, which has over 500 million Internet users (whose numbers are projected to grow to over 700 million by 2013), fare so much better than India, which has barely 120 million Internet users, despite the rather more free media environment?

From all accounts, it appears that it is the very distinct social circumstances that prevail in China, rather than business logic, that might account for the exponential growth in Internet usage and innovation, particularly when compared to India. That was the conclusion of experts who had gathered in Mumbai for a discussion on”Chinovation vs Indovation: Competition or Coopetition?” at the India Leadership Forum organised by Nasscom.

Chinese citizens don't have absolute freedom of the expression, except on the Internet, where the more enterprising ones have learnt to stay one step ahead of the censors. New York Times.

Raghav Bahl, founder of Network 18, and the author of Superpower? The Amazing Race between China’s Hare and India’s Tortoise, reasons that China’s political circumstances may be the principal reason for the relatively superior growth of the Chinese web world.

Unlike India, which has a long tradition of vigorous freedom of the press and a vibrant electronic media space, Chinese citizens don’t have absolute freedom of the expression, except on the Internet, where the more enterprising ones have learnt to stay one step ahead of the censors. The Chinese-language Internet, says Bahl, islike an island of free information that the Chinese hold on to.

Moreover, since the Chinese Internet world is a fiercely protected business universe, Chinese Net companies face no competition from international giants like Google, Yahoo, and Twitter, and therefore push the frontiers of innovation for their captive audience. That’s not a defence for having a protected market in India, but rather a comment on the fact that the presence ofinternational giants had made a material difference to how Indian companies have fared.

Language proficiency is another critical factor: the sites that fare really well in China are the ones running in a Chinese-language parallel universe, which acts as a linguistic Great Wall for foreign players..

Rebecca Fannin, author of Silicon Dragon: How China is Winning the Tech Race and Startup Asia: Top Strategies for Cashing in on Asia’s Innovation Boom, noted that the difference in the Internet infrastructure in China and India too accounted for this.

Bahl observed that India was only now auctioning telecom spectrum – almost two decades after economic liberalisation was first ushered in. And even now, services have not been rolled out, given the absence of adequate infrastructure.

On the flip side, whereas Indian policymakers are wary of foreign investment in the print and electronic media, the Internet world lends itself to unhindered foreign direct investment. Shouldn’t that have led to more innovation in India? Even in China, the “homegrown” Internet companies – Youku (user-generated video portal, modelled on YouTube), RenRen (a social networking site similar to Facebook) -were mere clones of the international giants.

Fannin traced this to the limitations of the Chinese education system, which placed an excessive emphasis on rote memorisation, which is reflected in how the Chinese Internet world has panned out. Even so, she pointed out, Chinese investments in scientific research have been huge when compared to India.

In fact, the topic of innovation came up again and again at the three-day forum organised by Nasscom. Maharashtra chief minister Prithviraj Chavan raised the bar for the IT world when he said that India would henceforth have to be more than just a source of cheap labour. The IT world had matured enough and it was time to deliver innovative products. Fannin said that just as China had gone out and made its story more convincing to the West, it was time for India too to get its message out.

Kiran Karnik, former Nasscom president, however, placed the India-vs-China debate in perspective by pointing to India’s “3D advantage”: democracy, diversity and demographics. As both India and China grapple with the challenges of changing their growth paths – with China moving towards a domestic consumption-based growth and India to a manufacturing-based growth – there is plenty for scope for innovative minds to sizzle and excel.


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