BEIJING — If one were to think of the Internet as a person with flesh, blood and a soul, then what would be the source of its soul? The answer will be a very different one depending on which country's Internet we are talking about.
In the United States, a Time magazine article explored the idea that what shaped today's personal computer and the Internet is the spirit of the hippies of the 1960s. The American generation born after World War II, bored with their rich but mediocre lifestyle, occupied universities and advocated sexual liberation, with rock music as its soundtrack. Though the movement was bound to end with the arrival of the oil embargo in 1973, the hippy spirit lingered on in music, films and art. And inevitably, the engineers who'd smoked marijuana carried it into the information revolution. They aspired to break the mechanical kingdom with an innovative technology culture that is freer than the one built by the likes of Henry Ford.
From Apple to Tencent
From Steve Jobs and Jerry Yang to Jeff Bezos and Mark Zuckerberg, whether they are native Americans or children of immigrants, all have hippy blood flowing in them — dropouts, revolutionary, liberal, never evil. Or at least that's what they've always said, and what Americans came to believe.
Totally distinct from the United States, when the Internet was introduced into China, the Chinese society was at the point of transforming into an extremely secular commercial version of the past. After the idealism and passion that accompanied social changes in the 1980s, the arrival of the Internet meant that all such faith in freedom was quickly extinguished. Young people stopped paying attention to politics. The vast majority of China's elite pursued business opportunities. Money became the only criterion to measure success and social value. In such a context, the wizard-like arrival of the Internet was regarded solely as a handy tool for the pursuit of wealth and commercial development.
Venture capital, as well as the Nasdaq stock market, intensified the commercial nature of China's online world. Internet companies were the first Chinese enterprises to be accredited by the international capital markets. From the day they were born, companies such as Sina, the largest Chinese-language web portal, and Sohu, a search engine, were the darlings of venture capital, soon to be publicly traded on the stock market.
Two young digital startup mavens were quickly ranked among China's wealthiest persons: William Ding at 32 years old, founder and CEO of NetEase, a leading Chinese Internet content provider; and Chen Tianqiao, at 31, known for his keen flair for online games. While real estate was where the largest number of China's richest came from, it was often suspect, while money made from the Internet enjoyed a far more positive image of being "wealth under the light of day."
China's technology world is regarded by many as simply following in the footsteps of the Silicon Valley — and indeed, so many Chinese Internet firms are clones of American prototypes.
Nevertheless, the ones that succeed eventually almost all find completely different survival and profit models from their models. Such has been the case with QQ, a clone of ICQ, the first popular instant messaging computer program, and WeChat, an instant messaging application for mobile devices and a clone of Kik Messenger. Whereas hardly anybody hears about Kik anymore, Tencent's success today has largely been thanks to WeChat, which has become China's most popular mobile app.
Consumer behavior
Thus, in the end, China has found its own way on the Internet, bound to best understand Chinese consumers' behavior. The case of Tencent is a perfect example of the differences in terms of buying habits. For instance, Americans are willing to pay for a song for their own personal enjoyment, whereas Chinese people are more likely to buy it for their friends to listen to. Already in 2011, a study showed that Chinese had surpassed Americans in the volume of use of social media: more eager to share, more willing to buy virtual goods, and overall more enthusiastic about making online purchases. As of 2014, China's online shopping business was already 4% bigger — in total retail sales of consumer goods — than America's.
Perhaps even more important, the closed dealings of China's financial sector forced Internet companies to reach their break-even point more quickly. Taken together, all this means that both in terms of the absolute number of Internet users and in institutional innovation, China has become a more exciting business market than America. Today, the achievements of Chinese Internet companies are beginning to surpass that of their U.S. counterparts.
If the Americans are always thinking about how to change the world, the Chinese tend to think about how to adapt to the changing world — and about how to change their lives. This is a concept driven by business value. More broadly speaking, therein lies a fundamental difference of life philosophy and business approach between the Chinese and the Americans.
China has so far remained an atypical modern state. The government controls almost unlimited resources while the huge state-owned capital groups hover upstream of industries and participate in policy formulation. Internet companies are a rare and sunny exception. Due to the new technology's rapid evolution and the uncertainty of resources, the government and the state-owned enterprises have so far failed to effectively take control of it.
The Internet has brought China unexpected commercial progress and surprising space for freedom. But at the same time, it carries with it new sources for confusion and ever trickier regulation that could stymie innovation. This is obviously just the beginning, and it's anybody's guess how it will play out.
China's Internet is a market independent from the rest of the world. Google, which refused to be tamed, was expelled. Despite his efforts at speaking Chinese, Zuckerberg's Facebook is still shut out. Meanwhile, Ma Huateng of Tencent and Jack Ma of Alibaba have become world-class entrepreneurs. The public responsibilities that come with this particular kind of success is a whole new code for them to learn.
