China's ride-hailing service Didi Chuxing on Monday announced a strategic deal with Uber China. Under the agreement, Didi Chuxing will acquire all assets of Uber China including its brand, business operations and data. Didi will also obtain a minority equity interest in Uber.
The acquisition has sparked strong reactions among the U.S. and other Western media. They portrayed the deal as "Uber's surrender" to Didi, repeating the failures of other American high-tech firms in China.
An article in The New York Times claimed that over the last couple of decades, Amazon, Facebook, Google and other American technology giants, like an imperial armada, rolled out from North America's West Coast, to "try to establish beachheads on every other continent. But when American giants tried to enter the waters of China, the world's largest Internet market, the armada invariably ran aground."
The U.S. media advocate that China's problem is largely to blame for the sinking of the American high-tech armada. According to them, the Internet has been divided into two parts - the Chinese Internet and the Internet of the rest of the world. The Chinese Internet lacks transparency and is subject to the government supervision. Only homegrown firms can adapt to it.
The Internet does have its own supervision system, but the supervision is fair to both local and foreign companies. U.S. Internet giants are at the helm of networking technology development, while Chinese homegrown companies as a whole still lack the ability to lead the industry. As the U.S. firms are naturally in an advantageous position, what makes domestic Chinese firms triumph over them?
Despite starting by imitating U.S. companies, Chinese Internet giants have based themselves on China's realities. They not only have extensively made technical innovations in accordance with the demands of Chinese users, but also adapted their business modes to the Chinese market and other non-market factors. But when U.S. firms operate in China, they often confound the core pursuits of Chinese users.
Take Google. Bound by values and emboldened by support from netizens who are well-disposed toward the West, Google had developed the ambition to transform China. But it made a strategic misjudgment of the Chinese market. When it was squarely at odds with the Chinese government, it didn't have support from the majority of Chinese netizens.
With growing strength, China's local Internet companies are becoming more confident and their employees are more industrious. All these add to their chances of defeating foreign competitors.
Apart from the Internet industry, foreign enterprises are also facing fiercer competition from their local rivals. The vitality of China's own business is being continually unleashed. If foreign companies want to win in the Chinese market, they have to invest more efforts. Don't use politics as an excuse for their failures. It won't be of any help.
