How does it "make sense"? Are you implying that the local company will behave more ethically? Baidu is also a mega corporation, that will surely allow the government access to your data at a whim.
Right now, it is merely stifling competition leaving the users without choice.
It will for sure comply with local tax rules, unless it is doing something illegal.
As it stands, Google, Apple, Amazon, Facebook, Microsoft, ... do not pay adequate tax rates in the EU. If we had local companies, we would not lose billions in tax revenues thanks to tax loopholes created by the US government, to benefit US corporations.
Regarding data management: will that be any worse compared to what the big five are doing? From the cuntry's point of view (and its citizens, one would assume), is it better that your government is spying or you, or that foreign corporations / governments are spying on you?
Put another way: are you more worried (as US citizen I assume) that the NSA / FBI are spying on you, or that the russians / chinese are spying on you?
At the risk of going off into the political weeds: define "adequate". The proper tax rate for a company to pay is, by definition, the amount they are required to by law. No more, no less.
We have legal framework for taxes. Corporations work around it by creating massive costs by paying phoney IP bills to their mother companies. The EU is trying to end these practices, but it is taking time.
If the companies were local, it would be much easier. Said another way, none of the big local companies in the EU are using this kind of setups.
To the Chinese government that's a feature, not a bug. This will be very interesting to watch whether Google's able to overcome severe hometown advantage in a way most companies aren't with the possible exception of Apple and maybe Microsoft?
All you people saying all governments favour local companies are, in my opinion, completely delusional.
Counter-evidence one: Google is #1 in Europe. That's sufficient to squash your point.
But also: You seem to have no idea what China is like. Foreign companies will get government-supported mobs to break into your office and trash the place, during daylight hours for hours, and the police will refuse to show up.
The best you can do is call the police and say "this mob slamming at the doors make me fear for my life. If you don't get me out of here I'll call my embassy and say there's a hostage situation". Suddenly the… no the police doesn't show up… the police tell you that the mob will disappear soon, and you have 5 minutes to leave before they come back.
Sir, I was at Google before and after the China pullout. You have no idea. All governments, to some degree, will of course side with local companies (tax incentives, etc.), but China is in a league of its own.
That's the first time I read something like that, no sources on google seems to pop-up, nothing on "mobs china foreign countries". It's obvious that China's biggest companies are tied to government, but I would be surprised if this didn't make to the news.
>The best you can do is call the police and say "this mob slamming at the doors make me fear for my life. If you don't get me out of here I'll call my embassy and say there's a hostage situation".
what is the american embassy going to do? call in seal team 6 to rescue you? the worst that will come of this is some strong words from the secretary of state.
People say "governments favour local companies" to defend the EU's ridiculous anti-trust claims against US tech, and to attack America for not breaking up American tech monopolies.
Apparently America is propping up all its tech companies and it's not allowing European companies to compete, thus is similar to CCP's support of Chinese tech companies; which is of course ridiculous for all the things you just mentioned.
The constant drum beat of "America is morally wrong for not using anti-trust on its tech companies" is just ridiculous. Especially when trying to compare the US government's approach to the free market to China's.
Apple, and Google (and probably more companies), made special deals with Ireland and Luxembourg to pay something like <5% VAT and <5% corporate tax, while everyone else were paying >20% and >20%. And those deals largely isn't available to EU companies because they can't use the favorable US tax laws to do it.
Despite Android being open source Google forced manufacturers to not sell any other versions of it if they also wanted to sell Googles. Which of course would be disastrous for any company.
Enforcement against that is only ridiculous if you don't like competition.
Until the tax law change this year, US companies were generally at a tax dis-advantage. Whether or not tech companies were more advantaged I don't think is as simple to say as the headlines would want you to believe but a large swath of US companies were at a global disadvantage for taxes. Effective Corporate taxes in the US were of the highest, and now they're more toward the global average.
They weren't at a disadvantage outside the US, that is the whole point. Apple's effective tax rate on profits in the EU, before the EC ruled otherwise, was less than 0.05% between 2011 and 2014. Money which they are using to compete in the rest of the world. For example from Apple's SEC Form 10-K, 2017:
"[...] undistributed foreign earnings, a substantial portion of which was generated by subsidiaries organized in Ireland, for which no U.S. taxes are provided when such earnings are intended to be indefinitely reinvested outside the U.S."
I wasn't talking about Apple specifically as the nature of digital companies is different, but US Corporations on the whole faced a ~38% tax rate globally vs. most countries being closer to 20% and this is something even the Obama administration wanted to change / partisan angles about this are dumb.
Uhm, no. This is a deliberate tax loophole that the government is fine with small companies using, but only feign being upset when large companies do it too.
They could just close it, but they don't want to.
Creating local optimizations for marketplaces is what the EU is for*.
Before the digital single market companies paid the rate at the country the were in. Since these companies where headquartered in Luxembourg they have been paying far lower rates over the years. Some of those rates have been to special deals directly with the government. This isn't something that has been available to most companies.
Similarly the "double Irish with a Dutch sandwich" only worked because of US tax law, simplified, lets US companies defer taxation on foreign funds through a loophole. That also isn't anything available to most companies and especially not small ones.
Last I checked it was still legal to use Baidu in America, which can't be said for Google in China. Please tell me how you think they're comparable, because I guess I am one of those "incredibly naive" people.
Just like we banned Toyota and Honda when they started destroying GM and Ford's marketshare. Or like how we banned Samsung when they started competing with Apple. Or...
These companies are from Japan and South Korea, and the companies don't really have access to data in the way a Google-like company has. This is more about security (surveillance, maybe even military security) than business.
Can you do a little better than a 'betcha'? A few pertinent examples of America interfering on behalf of mega-corps would do. I know they are there out there, but I can't recall them right now.
I think the "ban" of Huawei gives some hints on what might happen. Of course it would look different since the "customers" here are private citizens rather than corporations.
oh so the US goverment is coming from a single authorized ideological party, has ultimate powers, does not allow rule of Law and controls the whole economy? I learn new things every day.
Consider Google's recent actions on the whole military thing.
I get the impression that the US government doesn't understand or back US tech companies in general. US tech companies seem to succeed in spite of their government.
See DOJ vs Microsoft, city/state laws vs Uber, FBI vs Apple, etc, etc. I'm not denying that some of those actions against many of those companies were good; I would support some of those actions, but not support others. But no, I don't get the impression that the US government has the back of US tech companies vs the world. And certainly don't get the feeling that they have Google's back.
It does not need to because it has no competition. If baidu started getting traction in the US a huawei situation would be very likely as others have noted.
I know that, but what other backing do they get? Remember the recent EU fine? That would have been something to "smooth it out", but that did't happen.
Edit: nuking net neutrality is also in interesting way of "backing" Google.
Of course. There is no such thing as laissez-faire governance. All major economies have a close government-corporate structure because every major economy modeled themselves after the most successful economy in the world - the US economy.
We tell ourselves that there is a separation of government and private enterprise, but that hasn't been the case since day 1 when george washington's first move was to use tariffs to protect US companies. When our military was used to exterminate the natives to clear the way for railroads. When the US government annexed territory from texas to hawaii for corporate interests. Or when our government toppled latin american regimes so that our corporations could gain access to new markets.
Just like now all modern cities look like american cities ( skyscrapers ) and they have all same companies, all major economies ( especially the asian economies ) modeled themselves after 19th century US economy. China pretty much copied our playbook.
While what you're saying isnt wrong, it's not whats being discussed and not comporbable to China's actions. US doesn't make Google's competitors illegal.
Google isn't illegal in China. Unless you count its current form, but that is true for e.g. European gambling sites in the US. You can certainly argue that Google shouldn't be in China because of Chinese laws, but Google are the ones who made that decision. Which is apparently getting reverted and a major win for Chinese government.
> All major economies have a close government-corporate structure because every major economy modeled themselves after the most successful economy in the world - the US economy.
You make it sound like a US invention, but it's way older. I'd be more interested in learning of a counterexample. Which significant government didn't have too-close ties with its industries?
2. Laws are enacted or kept that favor these companies. Like the the tax loophole that, combined with intellectual property laws, effectively gives these companies huge tax discounts globally.
https://www.reuters.com/article/us-usa-tax-checkthebox-insig...
3. The US uses it power to force countries to sign agreements on or enforce e.g. intellectual property that favors US companies.
https://www.thelocal.se/20060621/4128
It is funny coming from them though. Well, bad news for them, united states is a leader in tech for a reason. I dont believe china can replicate that success, they will only clone. It is fine to trash talk, we know who wins in such situation.
As I've said in another thread, anyone who's used Baidu for any length of time should laugh out loud at the suggestion that it's anywhere close to Google in quality.
Yup, but what do we expect him to say anyway, that he'd lose to google? Investors would dump it right away. Similar to how xi is talking when it comes to trade wars, baidu behaves the same.
In China there exist several different terms. But hey, do most people even know the difference between Free Software and Open Source? It depends really on who you talk to; lets say a manager mostly will look at a cost perspective, while a software engineer might see benefits for integration, and even then mostly driven by the fact it is easily available, and perhaps even only consuming it. this is can also be different for most other places; Europe is more idealistic in the approach than America/US.
Note: European; Now I live in Beijing/China, help projects with consultancy for open source, did this for many years for companies... and now work for Red Hat.
It's worth noting that Baidu having a global presence allows the Chinese government to use it to attack their cyber enemies, so China has a vested interest in growing Baidu. Last time, China used the Great Firewall to weaponize Baidu's analytics worldwide for the largest DDoS in history against github in 2015 because github hosted two projects that allowed Chinese citizens to get around the Great Firewall and read the New York Times uncensored.
Sure. Ask any customs officer. Like it or not, the free markets in the United States created the greatest technological advances of mankind. China has nothing on that. Some lousy chip makers and cheap labour won't be able to compete with anything done in the US.
Also if Baidu was so great, try competing in the US or on neutral ground like Europe.
The free market in the US has created the biggest corporations known to mankind. However a drive to monopolise an industry doesn't necessarily equate to technological advancement. In fact often it can lead to the opposite effect where there is a lack of motivation to innovate once market penetration reaches a certain threshold.
The ironic thing is the free market in the US seems to be a one way street. There's a push for deregulation whenever it allows corporations to behave with moral ambiguity. However corporations often love legislation if it raises the barrier for entry for new start ups wishing to compete.
But going back to your original point, there have been plenty of great technological advances from China and Europe. Easily more than enough to dismiss your insinuation that the US has a monopoly on technological advancement, let alone the wider point regarding free markets.
Size doesn't equate to quality though. eg even when Microsoft was at it's peak it's fair to say they didn't keep pace with innovation (aside finding new ways for their software to hog memory and CPU). All too often it takes an underdog to shake things up.
However what the size of US corporations does prove is that the American system is better for building dominating businesses. But I'd already said that in my previous post.
You obviously know nothing of China's technological progress nor chip manufacturers. If you keep thinking they've been stupidly manufacturing high tech equipment without learning, and "USA is the greatest", you're in for a huge surprise if you look into their biggest tech companies a bit deeper.
>>Sure. Ask any customs officer. Like it or not, the free markets in the United States created the greatest technological advances of mankind.
Actually that's immigration. And sure Ask any customs officer.
>>China has nothing on that.
Very true.
>>Some lousy chip makers and cheap labour won't be able to compete with anything done in the US.
China's trade work in Eurasia and Africa is changing the trade scenario rapidly.
In a sense China is creating a market for local economies in Eurasia and Africa, so that local institutions can grow and work with each other.
Its kind of strange, the US could have had all of that trade empire for 1/10 the cost of wars and invasions in the past decades. China offers an alternate foreign policy framework, and its working to a large extent.
Again the US economy in many ways, is just the economy of a few cities, and immigration matters big time. Not just for the US economy, but if those people chose to stay in their countries its a negative to US as they create competition for the US.
Thing is 86% of people in a recent China poll indicated they would use Google instead of Baidu. Baidu has the market share but not the love of their users.
