By Silvia Lindtner
”The Promise of Production: How the Manufacturing Hub Shenzhen Became Enrolled in the Vision of the Maker Movement”
In April, 2015, at the annual Intel Developers Forum (IDF) in Shenzhen, Guangdong, China, Intel CEO Brian Krzanich announced a strategic alliance between the American multinational semiconductor chip maker and one of its biggest competitors in China, the semiconductor company Rockchip.
The renewed partnership between Intel and Rockchip came at an opportune moment. Over the past years, Intel has had to take big cuts in the non-iPad tablet market, largely due to the growing success and reach of its Chinese counterparts Rockchip and Allwinner. The partnership between Intel and Rockchip should guarantee continuous leadership in established markets such as the PC and the tablet industry, but more importantly it should also help firmly anchor Intel as the core platform for the next era of computing: the age of the maker movement and the Internet of Things, or as Brian Krzanich put it:
“The local and global impact of our 50 years of Moore’s Law innovation and 30 years of strong collaboration and winning together in China is unmatched. Intel remains focused on delivering leadership products and technologies in traditional areas of computing, while also investing in new areas and entrepreneurs – students, makers and developers – to find and fuel future generations of innovation with China.” (Reynolds 2015)
Rockchip has until recently received little attention by advocates of technology innovation – as has the city of Shenzhen, a manufacturing hub in the South of China, where this renewed alliance was forged. If anything, Shenzhen used to be known as a place that stood for low-quality and copycat production, far from any connotations of “innovating with China” as Krzanich characterized Intel’s 30-year-long relationship with the region at the 2015 IDF.
How did it happen that a Chinese chip manufacturer and a manufacturing region in China, formerly known as place of low-quality and copycat production, today constitutes the ideal ally for a U.S. multinational corporation to reposition itself in a changing climate of technology production?
This is one of the central questions that has come out of and eventually guided my continuous research on making, tech entrepreneurship and manufacturing cultures in China since 2010. This work is rooted in my own long-term ethnographic engagement in China as well as an ongoing collaborative research project in Shenzhen with Anna Greenspan from NYU Shanghai and David Li from XinCheJian.
In what follows, I will offer a synopsis of our findings in order to provide a glimpse into the much lengthier answer the question above warrants (for more detail please see our recent publication Lindtner et al. 2015).
The rise of the Chinese chipmaker Rockchip is fundamentally intertwined with the story of a unique open manufacturing culture that emerged in the South of China alongside and in the shadows of the region’s history of outsourcing and rise of contract manufacturing. Let me elaborate.
Shenzhen is a young city; what was a collective of villages only 30 years ago quickly transformed into one of the world’s largest manufacturing hubs. This was in part enabled by the implementation of a government policy that declared Shenzhen a Special Economic Zone (SEZ) (Ho 2012, Luethje et al. 2013 ). In 1979, when the SEZ policy went into effect, Shenzhen had a population of under 50 000. By 2010 it had morphed into a metropolis of over 10 million people.
The growth of Shenzhen coincided with, and was propelled by, the outsourcing boom in the US information technology industry in the 1980s. Throughout this period, companies in the US and Europe moved their manufacturing facilities into the low-cost regions of the developing world. Shenzhen constituted a particularly attractive site; as an SEZ, the barriers of entry for foreign corporations were significantly lower.
Over the years, a gradual upgrade of technological and organizational skills took place, accompanied by a process of vertical re-integration. Large contract manufacturers like Foxconn grew in size and eventually began catering almost exclusively towards large brands like Apple or HP.
As this happened, a dense web of manufacturing businesses emerged across the city of Shenzhen, catering towards less well-known or no-name clients with smaller quantities. This less formal manufacturing network (known as shanzhai 山寨in Chinese) is comprised of a horizontal web of component producers, traders, design solution houses, vendors, and assembly lines. At the heart of their mode of production lies an open culture of sharing, in many ways compatible with the values and ethos of the contemporary open source hardware and maker movement.
Shanzhai production unfolds through the design and production of so-called “public boards,” or gongban (公板) in Chinese: production-ready boards designed for end-consumer electronics as well as industry applications. In a nutshell, these boards function similarly to open source hardware platforms like the Arduino, but apply the mode of open production to manufacturing. What this means is that in shanzhai production the source, the Bill of Materials (BOM), and the schematics are shared amongst a network of thousands of factories.
The boards are designed so that the same board can go into many different products: e.g. one board can make many different smart watches or many differently designed mobile phones. It is through this mechanism of shanzhai – or open source manufacturing – that the region of Shenzhen has been able to produce a multitude of devices for niche markets untapped by their international competitors: low-income populations in China as well as markets in India, South America, Africa, but also Europe (Lindtner et al. 2015).
It is exactly this open source culture of manufacturing that has enabled local chip manufacturers such as Rockchip, Allwinner and MTK to eventually compete with internationally renowned corporations like Intel. In turn, it was because of these local chip manufacturers that shanzhai expanded from copycat production into a multimillion dollar industry with global reach. What made companies like Rockchip, Allwinner and MTK successful, however, was not only because they offered “good enough” chip technology at a great price, but more importantly because they managed to become deeply entrenched in the unique social fabric of the shanzhai manufacturing business, rooted in face-to-face networking, a mentality of “making do” and “making out of necessity,” and hard-driven work ethic.
Intel is not alone in promoting this culture of open manufacturing in Shenzhen as a contemporary site of innovation (Lindtner et al. 2015, Lindtner et al. 2014); since roughly 2008, a growing number of makers, hardware entrepreneurs and eventually investors turned their attention towards the manufacturing region in the South of China, promoting it as the crux for implementing the next wave of technological innovation: devices ranging from smart wearables like health wristbands and interactive fashion items all the way to embedded systems for the home, automotive industry, and logistics.
Shenzhen has become enrolled in the vision of the contemporary maker movement, which promises individual empowerment and economic transformations across developed and developing regions by enabling a return to production. Today, in these stories of a future of making, the term shanzhai is rarely used, which not only helps avoid any negative connotations with the region’s history and continuous practice of copycat, but also constitutes a powerful rhetorical move. Intel, for instance, calls shanzhai the “China Technology Ecosystem” or CTE and Shenzhen as a whole is promoted by investors, local governments and makers alike as the “Silicon Valley for Hardware” or a “Maker’s dream City.”
Shenzhen has been and will continue to play an integral part to how we make, design, and use information technologies; it already simultaneously extends and disrupts existing structures of power in global relations of technology innovation. What the handshake between Brian Krzanich and Min Li, then, symbolizes is a broader effort to transform the long and complicated relationship between two regions so central to and yet so differently positioned within the last 30 years of shaping technological innovation: Silicon Valley and the South of China, a relationship fraught with histories and stories of outsourcing, labor exploitation, conspicuous consumption, and e-waste, that is currently in the process of being remade and retold through the promising tales of partnership and enhanced production.
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