Being willing to comply with Chinese law is the catch to your question. Being willing to comply, means you're instantly put into a weak, disadvantaged state versus their domestic entities who get to play by an entirely different set of rules.
Disney can't even own their own park in China, they have to be a minority owner. So they build a nice, very expensive park, Disney Shanghai, and get 43% of it. That's the world's largest, most powerful media company, forced to beg on its knees just to get access to build in China. That tells you everything you need to know about how accessible China really is.
How's this for an example of how Chinese law works for outsiders? Jack Ma stealing tens of billions of dollars from Softbank and Yahoo, by taking Alipay away from Alibaba shareholders without proper compensation and without shareholder voting. He gave it to himself, discharging it out Alibaba and into his own hands, with complete disregard for what the ownership percentages were of Alibaba. It's one of the greatest thefts in world history, and these other large corporations were powerless to do anything about it. Ant Financial / Alipay of course is a critical piece of Chinese technological infrastructure, and is likely to go on to be worth a couple hundred billion dollars over time. For example this Wiki quote:
"In the fourth quarter of 2016, Alipay had a 54% share of China's $5.5 trillion mobile payment market"
That says it all about the extraordinarily vast scale of that theft. No chance China was ever going to allow Softbank and Yahoo to have such a big stake in that. So they looked the other way while Ma robbed the bank.
What outside technology company possibly trust being in business with Chinese tech companies on anything important or valuable to the Chinese economy after something like that? They'll just change or ignore the rules at will. I liken it to Jeff Bezos choosing to give himself most of AWS, discharge it out of Amazon.com's ownership structure, and not compensate the other Amazon shareholders for it. It'd be like Bill Gates granting himself Windows LLC, removing the product from Microsoft circa 1994 without shareholder compensation, and reaping tens of billions in additional gains that should have gone to Microsoft shareholders.
> That's the world's largest, most powerful media company, forced to beg on its knees just to get access to build in China.
Nobody is forcing them to build in China, disney just wants to make more money for themselves, so China can do whatever they want since it’s their land. If Disney agreed to this terms - it only means that it’s still profitable for Disney.
Of course China can do what they want with their country. You're standing up a point I wasn't challenging in the least.
The issue is: China is barely an accessible market for even the most powerful and largest of international corporations. Their rules for domestic entities are dramatically different than the rules for foreign entities, which is an intentional effort to restrict foreign competition and access to their economy. China wants to have its cake and eat it too.
Developed economies will increasingly shut down China's access in the same manner as China does, ending China's free ride. That process is already well underway with the US and Western Europe, as both have begun blocking China's ability to acquire local companies and technology. China will find it increasingly difficult to sell higher value products into the US and Western Europe (by far the two wealthiest economic regions on earth), restricting potential economic expansion for China.
It does seem like they have found a very effective "short term" strategy that will have a lot of trouble succeeding as their markets reach parity with ours.
Then again, maybe they're ok sacrificing long-term global growth to increase their domestic situation to something comparable to Europe or the US, at which point it won't hurt as much...
Wow, I had no idea Ant Financial was not part of Alibaba's main entity. Where can I learn more about this? I've done some work in China (even integrated Alipay/WeChat pay into an app) but had no idea this happened.
> In China this privilege is nominally given to the father or grandfather of the child. Asking a complete stranger, albeit a famous one to name your child is unheard of.
Check out Mark Kitto’s story for the ‘original’ example of this. To modify the original sentiment, it’s more like ‘any foreign company doing well in China will eventually be forced into a corner by unfair state aid to its competitors’
That's exactly the point for Uber: they lost against a local company, because the government did everything it could do so that didi would win the battle.
I've used both Didi and Uber in China many many times, and it seemed like they were competing against each other pretty hard, without discounts etc.
From my perspective as a customer, it seemed like they were both just trying to outspend each other to gain market share, and Uber just decided it was no longer a good use of cash.
Wasn't Uber losing ton of money in China? Also they had problems with regulators and local governments. I thought that was the main reason why they left.
I think the "problems with regulators and local governments" part is the implementation of the "forced into merging into a local entity" effect the great grandparent comment referred to.
Ironically, while it may be part of the implementation in China, Uber also has "problems with regulators and local governments" in every single place they do business. I am surprised Uber even got the chance to try in China.
Didi was also losing a ton of money in China. When they were competing head-to-head, both were offering ridiculous subsidies to both riders and drivers.
Can you provide an example of a foreign company that was willing to comply with Chinese law, but still faced this outcome?