Monthly Archives: November 2009

Of Collaboratories

Some 15 years the management literature unearthed coopetition, a concept coined right before World War I. For those who had just got used to this contraction time has come to learn a new one: collaboratories. In a nutshell, the idea is to bring down the walls so that researchers can perform their job without regard to geographical location. So far, nothing revolutionary you may think.

But for some companies, it actually implies a radical change in strategy. For instance, IBM is making collaboration with outsiders an essential piece of its research strategy. The company has been working with China Telecom and China Mobile, two of the biggest operators in the world, applying data analysis technologies to the huge (and growing) databases of subscriber and service information. The sheer scale of the Chinese telecommunication market allows researchers to play with billions of records, a unique chance to test and improve data mining algorithms.

Big Blue is even taking the concept of collaboratory a step further in China. It has partnered with the city of Shenyang to create an eco-city collaboratory, combining transportation, water, energy and food with the aim to define what a smart city would be.

Of nuclear reactors and supercomputers

What do a nuclear reactor of the fourth generation and a supercomputer capable of doing 1015 (one quadrillion) calculations in one second have in common? Not much, except that they both have been unveiled at the end of October in…China.

With Tianhe, or Milky Way, China becomes the second country, after the United States, to build a petaflop computer. The supercomputer is a part of the 863 program – a national initiative launched in the second half of the 1980s to do high-tech R&D. The machine is currently housed in Changsha – the city which saw Mao’s conversion to communism.

If that wasn’t enough, there was the announcement that construction of the first fourth generation nuclear reactor with “home-developed” technology would start in 2012-13. Going local on the technology side makes full sense for a country that plans to deploy 100 nuclear reactors over the next 20 years.

The catch? China is already running short on uranium. For sure, Tianhe will allow to compute even faster how much of the “stuff” they need – each new 1,000-MW reactor needs 360 metric tons of uranium a year when it first starts operations – and how soon they run out of uranium. But then an abacus would have been enough.

A Chinese NASDAQ!

What is the link between EVE (a producer of lithium batteries) and Aier (a chain of eye hospitals)? Both have just made their debut on ChiNext, the newly-launched Shenzhen-based stock exchange for innovative firms.

For now, 28 companies are listed. Hundreds have been reported to be lining up for listing, still a paltry in comparison to the 3700 firms trading on the American board. But then, it has been around for almost 40 years.

The NASDAQ-styled stock exchange still hopes to fill an important gap in China: funding small and mid-sized enterprises (SMEs). While accounting for 60% of China’s economic output (and 80% of employment), SMEs only received 36% of total loans.

Price-to-Earning ratio (P/E) was at 96 after one week, compared with 35 on the Nasdaq and 33 on the Shanghai index. A good alternative for those bored with Macau’s casinos but probably not exactly what ChiNext would need to succeed in the long-run: patient and long-term investors, something that the neighboring Hong-Kong Growth Enterprise Market (GEM) has learnt the hard way.

Regulating search engines?

In addition to the attempt to standardize the Internet of Things,  the Chinese Internet [community] is also paying attention to the regulation of search engines.

Baidu – the leading Chinese search engine and potentially most formidable competitor for Google in the long-run – has joined the Internet Society of China and the China Communications Standards Association to publish a set of search engine marketing regulations aimed at “developing the sector as a reliable source of news and business”.

Officially, the idea is to drive out disreputable companies who tarnish the reputation of search engine marketing in China. Something of a twist since this comes one year after Baidu came under fire for blocking searches containing words associated with the melamine milk scandal or having accepted money from fraudulent medical companies to figure prominently in search results!

What if this self-enligthened effort at self-regulation was to spread outside of China?  And, more importantly, will Google join the bandwagon?