The WSJ reports that China is on an extensive push to drive out Western tech companies from the country and replace them with domestic alternatives. China reportedly started its domestic expansion in 2022 with a highly secretive “Document 79,” an initiative focused on deleting Western tech companies from the country. Since then, China’s new plan has been in full effect — domestic alternatives have replaced most Western software providers.
When initiated two years ago, Document 79 was a super sensitive document that only high-ranking officials were purportedly shown. Security was so paramount that copies of the document were not allowed to be made. The initiative set out by Document 79 is to replace foreign software in China’s IT systems by 2027, with state-owned firms required to provide quarterly updates on their progress in replacing foreign software with domestic alternatives.
Two years later, the fruits of Document 79 are now apparent. Microsoft, HP Enterprise, and Cisco’s market share in China has fallen drastically in the past several years. In 2018, HP Enterprise had a 14.1% market share in China, but in 2023, that has fallen to just 4%. Cisco’s market share has halved in the past five years down to just 8%. Microsoft’s Chinese sales today account for just 1.5% of the company’s overall sales.
hello~
westerner tech guy in China here. they haven’t thrown me out yet, but then they haven’t grown up an equivalent of we do yet either. they haven’t tried to steal it or learn our secrets either.
nope for the last 3 or 4 years they’ve asked to license it to a local firm or better yet sell it outright to them. each time the price goes up and I suspect at some point it will become so irresistible that the founders will do it.
interestingly the sanctions closed us off from a lot of big institutes and companies who faced with losing the capability entirely just went ahead and acquired a bunch of Japanese stuff and jerry rigged it together. so that sucked.
because that’s it, if we don’t sell it to them someone else will and that’ll be the end of the party for everyone.
pretty sure this has played out in history before.
The article imply they aren’t looking for another seller but to domestically develop these products they need themselves. Although it’s still probably easier for them to use products from other non-western nations.