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China Businesses Hardware

Arm China Goes Rogue, Ex-CEO Accused of Blocking the Business (yahoo.com) 102

An anonymous reader quotes Bloomberg: Arm Ltd., the chip designer owned by SoftBank Group Corp., accused the ousted head of its China joint venture of hurting its business there, escalating a dispute that's becoming a test of Beijing's willingness to protect foreign investment in the world's second-largest economy.

The U.K. chip giant in June announced it was firing Allen Wu, the head of its Chinese unit, over undisclosed breaches of conduct, but the executive has refused to step down and remains in control of the strategically important operation. Rather than the peaceful, rapid resolution that both sides have said they want, the situation has deteriorated. Wu has hired his own security and won't let representatives of Arm Ltd. or his board on the premises, said a person familiar with the situation. He's refused to hold a planned event to connect Chinese chipmakers with Arm Ltd. and avoided negotiations despite public statements to the contrary, said the person, who asked not to be named...

Resolving the conflict will be crucial to SoftBank's reported plans to sell Arm, a lynchpin in the global smartphone and computing industry that the Japanese firm bought for $32 billion in 2016.

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Arm China Goes Rogue, Ex-CEO Accused of Blocking the Business

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  • by WindBourne ( 631190 ) on Saturday August 01, 2020 @12:44PM (#60355527) Journal
    Any foreign businesses built in China is NOT owned by those businesses. They ARE owned by the Chinese government. It is all about obtaining access to business IP that they would not get otherwise.
  • Oh please... (Score:5, Insightful)

    by Dutch Gun ( 899105 ) on Saturday August 01, 2020 @12:59PM (#60355583)

    a test of Beijing's willingness to protect foreign investment

    Does anyone truly believe China's government gives a bat's ass about "protecting foreign investment"? They've never been interested in fair play, enacting one-sided barriers to investment or market access, have been consistently willing to turn a blind eye to and even engage in IP theft and industrial espionage, and have stooped to kidnapping and imprisoning arbitrary foreign businessmen simply in order to put political pressure on Canada. I'll admit, this one is pretty brazen, even for them.

    Can we just admit that China is a rogue nation, and can't be trusted in the smallest degree, about anything? That Ex-Arm CEO is just flaunting it a bit more than others do. We need to cut our economic ties to that place as soon as feasibly possible. The US has been responsible for helping to elevate China to world power status over the last few decades, and now the orient is paying the price as we see an increasingly belligerent China making aggressive moves towards its neighbors.

    • Re: Oh please... (Score:4, Insightful)

      by ComputerKarate ( 659776 ) on Saturday August 01, 2020 @01:15PM (#60355629) Homepage
      Your exactly right. I used to work with a US engineer who went to China to look at the facilities where his company were going to have their products made. He asked about U.L. testing. The guy said "yes, we will put that on your product". The engineer was surprised and asked if that meant they would submit the product to UL labs for testing? The Chinese manufacturer said, "no we will just put that on the product". I wondered if there was some inspection agency that was supposed to inspect imports and taking bribes to look the other way for certain products.
      • Re: Oh please... (Score:5, Informative)

        by jonsmirl ( 114798 ) on Saturday August 01, 2020 @02:36PM (#60355785) Homepage

        That is BS. We manufacture UL approved products in China. Both UL and ETL have offices all over China.

        What the Chinese factory said was they'll make anything you ask them to make. If you tell them to print UL on the box then they will print UL on the box. They'll also print "I love Trump" on the box if you tell them to. But that is not really their problem, you are the one responsible for certifying with UL - they are just a contract manufacturer. So of course there are unscrupulous companies that print UL on products without getting them certified. The way you check is to look for the UL file number in the documentation and then look that number up on the UL website. Does the content of that file match what you have in your hands?

        As far as I know US Customs does not check UL because UL is not a law. When products get sold in retail stores, they do get checked. The way unscrupulous companies avoid this is by selling on Ebay or Amazon Marketplace which don't check (how could they? Ebay/AMZN never see the actual product). Amazon Marketplace != 'sold by Amazon'. I believe 'sold by Amazon' does get checked. US Customs does randomly check FCC and I know people who have had their shipments impounded for lack of an FCC ID. FCC is a law.

        • That is BS. We manufacture UL approved products in China. Both UL and ETL have offices all over China.. . What the Chinese factory said was they'll make anything you ask them to make. If you tell them to print UL on the box then they will print UL on the box.

          That's a false dichotomy. Just because you manufacture UL approved products in China does not mean there are no manufacturers that will just place a label and pretend there was testing. Unless you've dealt with the same manufacturer he dealt with, you can't possibly know.

          • That is BS. We manufacture UL approved products in China. Both UL and ETL have offices all over China.. . What the Chinese factory said was they'll make anything you ask them to make. If you tell them to print UL on the box then they will print UL on the box.

            That's a false dichotomy. Just because you manufacture UL approved products in China does not mean there are no manufacturers that will just place a label and pretend there was testing. Unless you've dealt with the same manufacturer he dealt with, you can't possibly know.

            More importantly, I've bought some products from China, and it's amazing the things they will lie about. And I'm not even talking about the super shady products on Amazon or eBay, but actual pieces of electronic equipment. Yes, that's anecdotal, but just from my own experience I'm not even slightly surprised if someone stamped "UL Approved" on something when they are so willing to lie about all the other specs.

            • by tlhIngan ( 30335 )

              Be aware that often times "UL Approved" products are on the power cord. The device is not UL approved, but the power cord is (legitimately). You'll notice the UL logo is wrapped around the cord itself and conspicuously absent on the device itself, but it'll say UL approved on the packaging because well, the power cord IS approved.

        • "As far as I know US Customs does not check UL because UL is not a law."

          I have to correct you on this -- UL is very much a law but at the state level, not Federal It is maintained and enforced by your state's insurance regulators, for obvious reasons.

          I know this because in a past life I was responsible for boiler welding and repairs -- and believe me, all of that work is inspected and certified to UL, or you do not get to own or operate a boiler. This falls under the remit of the ASME boiler and pressure ve

      • by AmiMoJo ( 196126 )

        The Chinese guy was right, it's not up to them to get your product certified. You do that and then the certificate applies to the stuff the factory makes to your specification.

        Maybe it was a problem with the translation and he just meant that they could work too the standard required to ensure the tests were valid. When I've had stuff made in China for work that's been the case. With high volume tolerances and test coverage have huge impacts on cost so they always want you to specify.

    • by Megol ( 3135005 )

      If they want to continue to increase their influence, yes, they have an interest. Now fuck off.

    • Up to a point, yes.

      If no one brings anything into China, then there's nothing to steal. So they have some impetus to keep the thieving to a level where people still bring valuables for short term gain.

      • Re:Oh please... (Score:5, Interesting)

        by Dutch Gun ( 899105 ) on Saturday August 01, 2020 @02:45PM (#60355801)

        Previously, western companies set up shop there because the labor was incredibly cheap, giving them an economic incentive to look the other way as blatant IP theft occurred. These days, China's labor isn't quite as cheap, and they're now able to compete with the west on technological parity in many areas. So we see that neither side really has the same incentives to play as nice - or rather, *pretend* to place nice, like they did in the past.

        It's true that China doesn't want to necessarily become an international pariah, but I don't think they care as much about foreign investment as they used to, as they've grown their own tech base to compete with other global powerhouses. I think at this point they're more concerned about foreign markets for their own companies. I expect to see it becoming more and more difficult for foreign companies to gain access to the Chinese market, except in very one-sided deals that end up hurting the investors more than helping. Yet the allure of that massive, tantalizing Chinese market is so powerful, some companies will inevitably still try, of course.

        We've had this idealistic notion that if China opened up, they might embrace a more liberal and tolerant form of government. Or maybe that was just a cheap justification for cheap labor. Instead, the exact opposite has happened, with now dictator-for-life Xi Poo using an increasingly heavy hand on both his own citizens and his neighbors. I just don't see any reason to keep financing this sort of regime. Yes, it's convenient for us, but I just don't think it's worth the short-term benefits. Why should confer the same trade benefits as we offer to friendly nations and allies? China is NOT anyone else's friend, and I think more and more people are starting to wake up to this fact.

    • Re:Oh please... (Score:4, Interesting)

      by hackingbear ( 988354 ) on Saturday August 01, 2020 @02:23PM (#60355771)

      Does anyone truly believe China's government gives a bat's ass about "protecting foreign investment"?

      More than believing US's government gives a bat's ass [reuters.com] about "protecting foreign investment"?

      • Re:Oh please... (Score:5, Insightful)

        by larryjoe ( 135075 ) on Sunday August 02, 2020 @12:34AM (#60356781)

        Does anyone truly believe China's government gives a bat's ass about "protecting foreign investment"?

        More than believing US's government gives a bat's ass [reuters.com] about "protecting foreign investment"?

        Yes, absolutely. In the US, a dictator has to deal with appeals courts, non-cooperative legislators, and pesky journalists. None of these checks on government abuses exist in China. It's night and day.

        • In the US, a dictator has to deal with appeals courts, non-cooperative legislators, and pesky journalists.

          Wrong, when the US is waving the sword of "national security", all of those are just camouflage. The judicial court has long succumbed to this deliberate loophole. And that's exactly why the US is using "national security" against a Chinese apps for fun videos -- there's no way to fight back.

  • by Ritz_Just_Ritz ( 883997 ) on Saturday August 01, 2020 @01:00PM (#60355591)

    Ask anyone who has lived and worked in China for any length of time to comment on this. I don't recall seeing a spat this public before with a high profile company, but it was not at all uncommon to see smaller businesses usurped by local leadership or have those leaders peel off, start a competing firm, and strip many of the key staff...leaving the original "owner" with a worthless husk. Even when the naughty folks are taken to court, the deck is stacked against the foreign firm. And even if they WIN a judgement, it would be for a relatively small/token amount.

    Cue up the replies from the wu mao dang:

    https://en.wikipedia.org/wiki/... [wikipedia.org]

    • Look at the IBM/Lenovo History for example.
      This is nothing new.

    • by Nocturrne ( 912399 ) on Saturday August 01, 2020 @01:39PM (#60355677)

      I lived and worked in China for over 18yrs. For a time, foreign investments appeared to be workable, but the reality that everyone feared became clear after Xi Jinping decided to make himself emperor. I always advised clients to keep their IP out of China to keep it safe - most were smart enough to do this, but not all. The money offered by Chinese investors and the potential for sales in the China market fooled a lot of big companies.

  • by anoob7000 ( 4444387 ) on Saturday August 01, 2020 @01:01PM (#60355593)

    I'm amazed that western companies still go to China with all this absolute nonsense. I say screw ARM and let them suffer. I think some of these large companies have to learn that the Chinese government is not a friend and only wants to support local businesses.

    In my book, if companies go to China for manufacturing or to setup shop, then you should sign a waiver that says, "I will not complain when my stuff is stolen or copied and the government looks the other way."

  • Fuck China (Score:2, Insightful)

    Nothing good comes out of China.
    • JAPAN so far is the only nation to start decoupling from CCP Land, I recommend buying from Japanese companies as much as posible.
  • by backslashdot ( 95548 ) on Saturday August 01, 2020 @02:15PM (#60355755)

    All that has to happen is nobody should buy or import ARM cores from any entity that is, by international law, illegally licensed. Nobody will pay Allen Wu or "ARM China" for something they can't sell.

  • When did ARM become Arm?

  • It is about Nvidia. (Score:4, Interesting)

    by nazsco ( 695026 ) on Saturday August 01, 2020 @03:30PM (#60355881) Journal

    Nvidia produces most of its products on Taiwan.[0] And their very low end and low volume mainland china.

    CCP is probably forcing their hand to move more highend/highvolume production to mainland, to boost china-2025 program.

    Nvidia is maneuvering this by buying ARM, and effectively having lots of production on mainland.

    Some group in the CCP do not like that compromise and Allen Wu is in it.

    [0] https://techcrunch.com/2018/12... [techcrunch.com]

    • Nvidia produces most of its products on Taiwan.[0] And their very low end and low volume mainland china.

      This doesn't make sense to me. And why would China actually care about this? NVidia has their HQ in the USA not Taiwan. ARM themselves manufactures very little. Their licensees do. Many, many ARM licenses already manufacture their chips in foundries in Taiwan like TSMC. All the transfer means is that ARM is now a US company rather than a UK subsidiary of a Japanese company.

  • If you transfer production to China, you must transfer the tech there so the workers can do the production. If you transfer the tech there, you give the tech to the Chinese government (that was a major point of last year's new encryption laws there which made it illegal for foreign companies to encrypt any data within China without giving the government there a way to access it and read it).

    Only [a] a complete fool, [b] somebody narrowly focused on his CURRENT business but ignorant of history, economics, an

    • This was actually started by Nixon and Kissinger; Tolerated by Ford and Carter; Then expanded under Reagan . The theory was that "engagement" would convince the CCP to change their ways. It certainly caused them to drop Communism in favor of Capitalism. But it did nothing to get rid of the corrupt, oppressive, dictatorship. Opponents of the policy have long called it "appeasement" (a reference to the strategy for dealing with Hitler before WWII). It would appear they are correct.

  • Allan Wu would not be doing this without the backing of the CCP. As China and the west decouple, we are going to see a lot more 'Mainland Chinese CEOs' of western companies refuse orders from the western head and go 'rouge'. Good chance this will happen with a number of white-goods companies, cars (GM, Ford and maybe Tesla) and other manufacturing based companies. Place your stock market bets accordingly.

Understanding is always the understanding of a smaller problem in relation to a bigger problem. -- P.D. Ouspensky

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