Futureproofing your English with Technology: Getting the most return-on-investment in an automated world

A week ago I gave a guest lecture at a local college discussing three high growth areas in China: artificial intelligence, robotics and elderly care.

I also explained to the college students majoring in foreign languages such as English they should continue learning other skills, instead of merely mastering English proficiency. This was given on December 4, 2013 at Shanghai University of Sport. All citations are included in the notes (the PPT is up over here at Slideshare.net). Note: about 5 minutes are missing in the middle of the video due to technical issues. [Here is the same video on Youtube]

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Robotic appliances for household uses

In some non-China news, last month iRobot celebrated it’s 11th anniversary.  DailyFinance published an interesting piece discussing the future of the company that makes Roomba, Scooba and other robots.  Also, Engadget posted an interview with Colin Angle, the CEO regarding the past, present and future of the company.  Hint: it will look a lot like Jude Law and Rosie the Robot than most people expected.

Bonus: SingularityHub has posted a couple videos of some rugged robots in development at Boston Dynamics.

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Stat of the day – Robots in China

From The Economic Observer this past week according to Akira Mizutani of Yaskawa Electric Corporation:

“The total sale of robots in China last year was 28,000 units. It will be about 30,000 this year. And it’s going to continue to grow by 20 to 30 percent a year for for quite a while.”

[…]

Wang Feiyue (王飞跃), director of China’s State Key Laboratory of Management and Control for Complex Systems (SKL-MCCS), says that for every 10,000 manufacturing workers in Japan, 300 robots are used — whereas in China that number is just 10. So there’s a huge potential market for robots in China, the widespread use of which will improve the country’s overall manufacturing level.

See also robots discussed in Chapter 7.

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Chapter 6 – Games, health and robotic related services for the elderly

[Note: below is Chapter 6 from Great Wall of Numbers]

In October 2011 I had a bad bout with food and ended up having to stay in a hospital for a few weeks in provincial China.  In contrast to the modern facilities at Huadong hospital in Shanghai (which I have also visited), all three public hospitals in Bengbu, Anhui were at the time, less than sanitary and for residents of the West, a seemingly step-backwards-in-time.  During my stay, I befriended one of the surgeons who had studied in Switzerland.  Dr. Wang or “Charley” as he affectionately called himself, gave me a tour of the in-patient facilities I was staying and said, “Tim, look around, we can barely cope with medicating and treating these patients – how could we possibly take over the world as some media outlets suggest?”

He raises a visceral point.  Despite the abundant growth over the past three decades, one of the industries that has had its share of growing pains is the health care sector (see Chapter 19 for more).  While the debate over government versus private ownership and maintenance of the industry continues on in China, there are a number of opportunities that US medical companies can capitalize on. For example, while the pharmaceutical industry is basically tied up with patent and legal proceeding and negotiations on both sides of the Pacific, US-based medical equipment and medical device manufacturers now have a liberalized export channel compared to just a few years ago.

Overlooked yet increasingly important

On a national level, life expectancy in China has grown from 65 in 1976 to 73 in 2010.  While its increase may have plateaued, reaching farther back in time illustrates how prolonged life expectancy is a positive spillover effect due to economic growth.1 For instance, according to Xinhua, the average life expectancy in Guangdong (the wealthiest province) has risen from 31 in 1949 to 75 in 2008.234

Assuming the retirement age is not increased, by 2050, it is estimated that 31% of China’s population will be near the age of retirement.5 In contrast, today about 14.8% of China’s population is over the age of 60.67

Yet with these demographic changes come different opportunities as well.  According to Zhao Baohua of the Gerontological Society of China, he notes that in terms of entertainment and “toys” for the elderly, “[a]bout 99 percent of Chinese toy factories just produce items for children, but in more-developed economies about 40 percent of toys are designed for older people. It may take China 30 years to catch up with some countries in this area.”8

Here is an area where Western-based toy, games and entertainment companies can export goods and services to a market ripe with potential.  For instance, Amazon.com has several pages of “toys for the elderly” and “toys and games for senior citizens.”  And as described below, there are a number of other made-for-the-elderly products that are currently available in the West but not in China.

This also raises the question, what activities do elderly populations in other countries have access to?  One potential answer to that could be the apartment complex where I currently live in Changning, Shanghai which has a small playground that is typically used by both toddlers and the elderly alike.  According to a Reuters report, “there were over 15,000 pieces of elderly workout equipment parks across Japan.”9 This same report noted that “an elderly playground starts at 8 million yen ($87,220), including the installation of equipment and instructors’ fees.”  Thus there is a potential business opportunity for US firms that develop playgrounds to export their products and services to China.

What about demobilizing conditions?  In the Netherlands, a village was recently built that “doubles as a nursing home,” serving clients suffering from dementia and Alzheimer’s.10 Similarly in Switzerland, a $26 million village has been built catering to the elderly afflicted with Alzheimer’s as well.11 In 2007, six million Chinese suffered from Alzheimer’s and that number is expected to grow markedly as the population ages.  In fact, one third of all Alzheimer’s sufferers live in China.  Shanghai alone has 120,000 residents with Alzheimer’s or dementia.12 While the debate and conversation over how to help treat these patients is still on-going, many Chinese families have now found solace through new treatment centers opening across the country.13 And with new centers comes potential markets.

What can foreigner medical experts do on the mainland?

In November 2012 I spoke with J.J. Liu who is originally from Beijing.  After completing graduate school he moved to California and worked in the bio-med industry for about 20 years before returning and now is the marketing manager for QIAGEN’s operations in China.  QIAGEN is a German biotech firm that builds and designs technologies to diagnose and measure biological specimens (e.g., when you give a blood test, they make the machine that analyses it).  Liu mentioned that as China ages the potential to provide services for the elderly increases as well.  For example, he noted that because of the economic boom in the 1990s and early 2000s many of the elderly now have more assets and funds to spend on improving their health, including the possibility of residing in assisted living facilities – or as he observed, “villas and hotel-style living that are arguably more culturally acceptable.”

Historically, Liu explains, “in the past the average resident did not have the resources to receive medical treatment – while the medical knowledge and facilities were lacking – families simply did not have the assets and resources to finance medical treatments.”  As a consequence, many families simply self-medicated through the purchase and consumption of relatively cheap drugs and TCM (Traditional Chinese Medicine or 中医) at local pharmacies.  While this self-medication phenomenon still takes place, Liu and others expect that these consumers will be able to utilize modernized Class 3 hospital facilities (the top flight), many of which are now stocked with the latest medical equipment.

What other opportunities can foreign companies become involved in?

In Chapter 3 I noted that Chinese consumers largely perceive foreign brands as premium quality. Liu noted that pharmaceutical brands are no different, as “Chinese patients are partial to imported products.”  Yet one of the limiting factors has been relatively high prices.  And some medicines like insulin for diabetes have few generic substitutes.  This price inelasticity means that the 92.3 million diabetes sufferers alone (China is now the “capital of diabetes”) have created an additional $3.2 billion drug market.14

Liu also expects that the current health care reforms being implemented by various levels of government via the 12th Five-year Plan will have “wide-ranging effects, most notably in terms of pharmaceutical costs.  Previously multinational companies [MNCs] were given a preferential pricing policy that allowed them to charge 100-200% markups on medicines whose patents were already running out in the West.  In the next several years this markup will be reduced to a mere 10-20% while simultaneously generic brands are introduced.”

Prior to these reforms, Chinese policies required that in order for MNCs to have access to the market they would need to produce and manufacture the pharmaceuticals on the mainland.  In doing this, policy makers expected a knowledge transfer would take place – as in the auto industry, which I briefly discuss later in Chapter 10 – as MNCs would need to train local staff and administrators.

Subsequently, while very little original research and development has taken place on the mainland over the past decade, going forward many MNC pharmaceuticals have opened up regional headquarters in China to take advantage of both the increased resources being placed into the health care industry as well as recruiting from a well-trained local talent pool.

What does this mean for you and your company?

In six years since it was established, QIAGEN’s Asia Pacific sales have grown from zero to accounting for almost 20% of global sales.  Simultaneously its Shanghai headquarters has grown from 1 employee to 400.  How has it done this?  Its double digit growth rates comes from selling medical systems – like those described above – through distributor channels to hospitals and clinical research facilities (QIAGEN as a whole generated $1.17 billion in 2011).  And because of the various reforms being enacted in all cities, counties and provinces, there are substantial areas of growth for medical providers, both domestic and foreign.  One other area where Liu sees specific potential opportunities for foreign experts is to help set up and train staff at a wide-array of facilities, including retirement villas.  Thus if you and your company already provide health care services you may be able to find new opportunities and revenue streams in China as well.

Lack of products presents opportunities

While services such as LifeCall’s medical alarm (creators of the catchphrase: “Help, I have fallen and I can’t get up”) have been offered to US residents for more than 15 years, there are few equivalents in China at this time.  Even though it is debatable whether or not such a service would prove to be popular in China, one possible product that has gone under the radar and could appeal to elderly Chinese consumers are e-Pants, designed by engineers at Virginia Tech.15 Embedded in the pants are several electronic gyroscopes and accelerometers that communicate to nearby computers via Bluetooth and can detect whether or not a wearer has fallen down.  Similarly a team of researchers at the University of Adelaide are using RFIDs and software to detect sensory movement and help monitor the activities of the elderly so that these aged consumers can continue to live both independently and safely at home (e.g., alert emergency providers if an accident occurs).16 Maybe you or your company can integrate LifeCall’s functionality with e-Pants.  Or perhaps your firm can take a page from Fujitsu who in February 2013 unveiled a “smart” cane called the Stylistic S01.17 Embedded in the handle of the cane is a GPS with LED lights that can help point the user in the correct direction.  In addition, built-in sensors can monitor temperature, heart rate and even humidity.  Their target market is the elderly as well.

Because of Japan’s rapidly aging population (it has the highest average age in the world) its engineers are also at the forefront of innovating and producing both machines and robotic solutions to provide support for the elderly.18 For example, the AGNES suit allows its wearers to feel what it is like to have limitations in physical motility.  The Hybrid assistive limb (HAL) is a new robotic exoskeleton developed by Tsukuba University in a bid to help improve the physical capabilities of its users.19 In the UK there is Hector, a mobile “assistive” robot that can follow its owners and take commands via a touchscreen.20 In the US, there are a number of social and domestic cleaning robotic projects such as the PR2 from Willow Garage and the Roomba from iRobot.21 And since China is rapidly aging as well, this presents an opportunity not just for foreign robotics companies but also IT firms to export their solutions to China (see Chapter 13 as well).22

Digital demographic differences

While personal computer ownership in China continues to increase over the past two decades, as the average urban salary is about $3,430 a year, the typical urbanite usually does not have the funds to pay for one at home.23 That serves as a reason why, internet bars or net cafes (wangba) are substantially much more popular than their Western equivalent.  Xinhua estimates that as of 2009 there are more than 138,000 “cybercafés” in China.24 And 70% of the customers are between the ages of 18 and 30.

So where does this leave the aged and elderly?

As I mention later in Chapter 13, both the iOS and Android app marketplace’s in the US have a number of simple games that some older audiences have gravitated towards.  And as smartphone proliferation continues in China, this presents Western developers and programmers with an opportunity to port and translate their games to a similar demographic across the Pacific.

For example, in 2012 approximately 189 smartphones were sold in China and at the end of November 2012 there were now 1.104 billion phone users on the mainland – 233.4 million were 3G users (3G adoption will increase by 100 million in 2013).2526 This past summer China overtook the US to become the largest smartphone market.27 Flurry now estimates that as of February 2013 there were 246 million smart devices in China compared with 230 million in the US.28 It is thus unsurprising that China is also the fastest growing market for iOS and Android devices.29 Yet in terms of demographics, the vast majority (~90%) of smartphones on the mainland are owned by users who are less than 55 years old.

As I mention later in Chapter 13, in the US, 50% of Solitaire and FreeCell players are senior citizens and 44% of US seniors have played solo games online.3031 Yet a 2012 Flurry Analytics report found that only a mere 3% of US users aged 55 or older, play games on their phones.32 However, in terms of total tablet and smartphone ownership, according to Flurry, in the US this same elderly demographic group (55+) represents 17% of the total tablet and smartphone ownership.

While open market research is relatively scarce on the Chinese side, CNNIC (which is part of the Ministry of Information Industry) estimates that the internet penetration rate for those over 50 is the lowest, at 7% in 2010.33 A 2010 IDC report found only 7.1% of those aged 55 or older play computer games in China.34 One estimate from iiMedia was that 10.1% of Android users in 2011 were aged 45 and older.35 iResearch estimates that 3.8% of iPhone users in 2011 were 45 and older.36 Similarly, a February 2012 report also from iResearch found that approximately 6% of Chinese mobile internet users were 45 and older.37 And Askci estimates that only 1.5% of 50+ year olds in China had a smartphone by the end of 2011.38 So in short, smartphone and computer penetration is relatively subdued within older demographic brackets.

Why is there such a disparity between the US and China?  Why does it matter?

I posed this question to a number of Chinese students and colleagues and they noted that the vast majority of the elderly in China were born and raised on farms and are unfamiliar with the latest technology (e.g., only 51.3% of the population is currently urbanized).39 Another issue could be illiteracy rates.  For example, an older New York Times report noted that many of the less developed more rural regions of China have much higher illiteracy rates.  In 2001, parts of Tibet had up to 42% illiteracy rates.40 Yet trends could be changing as We Are Social estimates that there are at least five million shoppers and increasing over the age of 50 in China.41

Apps that cater to the elderly

One argument against investing resources towards this demographic group is that you do not, with such relatively low market penetration why invest the resources for a risky return on capital?  However one unseen opportunity is the ‘long tail’ – that the simplified game you make could find an audience with other demographic groups such as primary school students at the other end of the population pyramid.

For example, Brain Age is a best-selling Japanese puzzle game for the Nintendo DS (a handheld gaming console) that is popular and successful in part due to its simplicity and ease of use for a wide-range of ages.  Perhaps Western developers could look to the simplified user experience design (UXD) in Brain Age as they port their games over to Chinese markets.

In my own anecdotal experience I think an overlooked, yet important phenomenon regarding elderly Chinese is that they are incredibly social and often even physically active.  On any given night you will see large groups of seniors dancing in plazas, practicing qigong and playing mahjong along the roads.  As my students noted above and the CNNIC data illustrated, if a developer could make accessing apps and the internet itself relatively easier elderly customers may find smartphones less imposing and confusing (e.g., tap on a big simple picture of the person you want to talk to).42

And in addition to using easy-to-see objects, be sure to modify the games to include Chinese traditions, symbols and cultural tie-ins – or in other words ‘Western video games with Chinese characteristics.’  For example: the color red, number 8, and the Chinese knot (Zhōngguó jié) are all considered lucky.  In the early 2000s a knock-off of Red Bull completely redesigned their can to fit the Chinese penchant for red and gold.43 Perhaps creatively integrating these symbols into your game would prove crowd-pleasing.

Also, even though gambling is currently banned on the mainland, this has not prevented small-scale gambling activities from taking place (e.g., in 2007 Macau overtook Las Vegas in gambling revenue).444546 From my observations, a large part of gambling is done in person on pieces of cardboard in the streets or in little game houses (e.g., tea houses and mahjong parlors).  This is not an endorsement of these illicit activities.  Rather this consumer behavior presents an opportunity for app developers to focus on both simplicity and the social aspect of any app that is created.  And since gambling is popular across many demographic groups, perhaps designing a “social” fortune-style game or a non-monetary betting app would find success across the mainland.

Thus while there is viable market potential for game and entertainment developers to create applications for both sides of the Pacific, careful due diligence of age and technology distribution and proliferation is recommended.

Service with a smile

Another possible area for business opportunities is senior care services.  In a December 2012 email exchange with Qian Jianchu, a professor at Shanghai Institute of Foreign Trade,47 he mentioned to me that “elderly nursing will be the most prosperous industry in China in the next 10-50 years.  The market is currently at a relatively low penetration level at present due to the lack of management experiences and promotion.  Therefore foreign firms with experience may find many opportunities in this segment.”  Why is this the case?  Because as noted above, assuming the retirement age is not increased, by 2050 it is estimated that 31% of China’s population will be of retirement age; and within 40 years China “will have nearly 500 million elderly people.”48 Yet despite this increasingly larger demographic bracket, “only 8% of elderly Chinese consumers feel that marketers adequately target them with advertising and products.”49

There are exceptions such as the US-based hedge fund Fortress Investment Group who is investing in and working with China Senior Care to provide “elderly care and retirement facilities.”50

And while assisted living and senior living centers have become increasingly popular in Western countries, aside from several token centers in China, they are virtually non-existent.  That is to say, only 1.6% of people over 60 on the mainland (compared with 8% in developed countries) are accommodated in some way by care facilities.51 Or rather, all but a few of the affluent do not currently receive services from an assisted living center.  Yet according to a report from China’s National Committee on Ageing, about 12 million Chinese over the age of 60 would consider retirement villages an option.52  This potential is one of the reasons why J.J. Liu recommended the market segment for potential entry by experienced foreign firms.   In fact, Fortress is investing $1 billion over the next several years to build and operate centers in larger cities like Shanghai and Beijing.  And the sky may be the limit, as the most expensive 7-star nursing home in Hainan province targeted and tailored at seniors recently opened in Haikou, charging between $1,283 to $2,444 per month.53

In contrast, a 2008 study noted that approximately 1.4 million Americans currently live in several thousand assisted living centers and nursing homes.54 Thus the potential opportunities in China to not only train the staff but also to sell and equip the centers with vital materials provide Western firms and entrepreneurs with new revenue streams in the immediate future.

Some critics may argue that firms like Fortress Capital are getting ahead of themselves, that there may be very little genuine demand – regardless of costs – for assisted living.  For example, Shanghai International Medical Zone (SIMZ) had a tough time starting up several years ago.  It was initially planned to be a luxury retirement village targeting wealthier retirees.  However as part of its marketing push its owners “boasted an investment partnership with Augustinum Group, a leading provider of retirement homes in Germany.”55 Yet work on SIMZ actually stalled for a few years and Augustinum said it never made investments on the mainland.  SIMZ has since been completed and subsequently foreign firms such as Eli Lily (a large US-based pharmaceutical company) and Parkway (a Singapore-based health care provider) have begun operating in the zone.56 Thus even though there is potential due to an expanding market driven by a rise in living standards, investors should still be cautious.  Another argument notes that one of the three Confucian ideals that children are taught is filial piety (xiào): take care of their parents when they grow older.57 Yet because of cultural dynamics, home healthcare may eventually become an accepted alternative as Liu noted above.  Just as generational changes in the West led to outsourcing care of our aged parents, so too may the post-1980s generations (bā​líng​hòu) do in China.

I also spoke with Adam Clemans who echoed similar rationales and prospects.  Clemans is an American pharmacist who works at an international hospital in Shanghai.  According to him, “while somewhat tangential with the filial piety idea, many Chinese children do not necessarily want to (or cannot afford to) spend enormous amounts of money on their parents, but rather they want to get them things that seem like they might be expensive.  The simple fact that something is imported or made by a foreign company makes it seem valuable and special.  For example, relatively mundane “low-tech” items like slip-proof rugs or handle bars for getting on and off the toilet could be attainable hits.  In addition, I think there might be a third market (upper-middle class) for elderly care as well.  Not necessarily super-luxury, but with more Western characteristics (like clean floors & privacy).  Right now it seems like there seems to only be two options, cheap or extremely expensive.”

With a middle class currently numbering 300 million – and estimated to grow to 600 million by 2020 – these alternative care options could become increasingly possible for consumer and suppliers alike.58 Yet again it should be pointed out that middle class is defined as those with at least $3,000 a year in disposable income (e.g., earn between $10,000 and 60,000 pre-tax).5960 So while they have more funds for supporting their elderly relatives, they may not have enough to buy a product like a walk-in bathtub quite yet.  In addition, your company may be able to cater to clients from the Greater China region such as elderly Hong Kong pensioners.  According to the Guangdong provincial government, 69,000 elderly Hong Kong pensioners now live in retirement homes throughout the Pearl River Delta – the bulk of which (more than 10,000) reside in Guangzhou.61 One of the main reasons is that the quality of care is purportedly the same as it is in Hong Kong yet the labor costs are significantly lower thus enabling retirees to live more flexible in terms of finances.

Takeaway: The rapid demographic changes within China present health care providers, robotic manufacturers and game developers with opportunities.  What products and services can you and your company invent and export to China?  These solutions can range from the seemingly obvious, personal movers like the Rascal to something less evident such as old-age proofing doors and cabinets or even simple smartphone games.


Endnotes:

  1. Life expectancy in China Rising Slowly, Despite Economic Surge from The New York Times []
  2. Life expectancy increases by 44 years from 1949 in China’s economic powerhouse Guangdong from People’s Daily []
  3. Residents of Shanghai has the highest life expectancy at birth on the mainland, at 82.41 years.  See City keeps top life expectancy on mainland from Shanghai Daily []
  4. Guangdong has led GDP provincial output on the mainland since 1989.  In 2012 its GDP output was 5.7 trillion RMB ($920 billion) which is half the size of India’s.  See Guangdong GDP up 10.2 percent in 2012 from NewsGD, Jiangsu unchained: Top in per capita GDP, Guangdong in its sights from Want China Times and Guangdong leaders fear they will lose economic pole position to Jiangsu from South China Morning Post []
  5. Empower elderly to be active participants from People’s Daily []
  6. See Age will weary the Chinese miracle from BusinessSpecator and Elderly population to surpass 200 mln in 2013 from Xinhua []
  7. China’s Achilles heal from The Economist []
  8. Age of disillusion haunts senior citizens from China Daily []
  9. Japan’s elderly playgrounds show fun is for everyone from Reuters []
  10. Alzheimer’s Disease: Dutch Village Doubles as Nursing Home from ABC News []
  11. Switzerland’s ‘Dementiaville’ designed to mirror the past from The Independent []
  12. See China in Alzheimer’s double bind from BBC and China, in a Shift, Takes On Its Alzheimer’s Problem from The New York Times []
  13. China, in a Shift, Takes On Its Alzheimer’s Problem from The New York Times []
  14. This upfront cost is on top of the $26 billion in annual healthcare and lost productivity.  See China Diabetes Triples Creating $3.2 Billion Drug Market from Bloomberg and China’s diabetes epidemic exacerbated by one-child policy from News Track India []
  15. E-Textile Pants Identify Fall-Prone Elderly from PhysOrg []
  16. Computer science helping the aged stay home from The University of Adelaide []
  17. Fujitsu prototype GPS cane hands-on: the future of monitoring and protecting the elderly from Engadget []
  18. For an in-depth discussion on assistive robots, see Population Ageing and Socially Assistive Robots for Elderly Persons: The Importance of Sociodemographic Factors for User Acceptance from the International Journal of Population Research []
  19. Robot Suit Hal from Cyberdyne []
  20. Hector: Robotic Assistance for the Elderly from Forbes []
  21. Another robot that could potentially assist both the elderly as well as manufacturers is Baxter.  See Small Factories Give Baxter the Robot a Cautious Once-Over from MIT Technology Review []
  22. With their increased popularity in North America, selling walk-in bathtubs may also be another market opportunity although transportation inland may be difficult. []
  23. Low rate of ownership to lift PC buying from Shanghai Daily []
  24. China saw 138,000 Internet cafes as of 2009 from Xinhua []
  25. China Mobile alone sold 60 million TD-SCDMA (a domestically developed radio technology) devices in 2012.  See Check Out 3 Years of Stunning 3G Growth in China from Tech in Asia, China’s Smartphone Sales Grow 189 million Units in 2012 from MIC Gadget and China Mobile Sold 60 Million TD-SCDMA Devices Last Year from China Tech News []
  26. See China Had Over 1.1 Billion Mobile Phone Users By November 2012 from China Tech News and China Has Over a Billion Mobile Phone Users, 192 Million 3G users from Tech In Asia []
  27. China smartphone market to overtake U.S. in 2012 from Reuters []
  28. China Knocks Off U.S. to Become World’s Top Smart Device Market from Flurry []
  29. Flurry: China Is Fastest Growing Market For iOS & Android devices, Chile comes in 2nd from TechCrunch []
  30. Vintage PC Video Games Still Thrive in World of App from Nielsen []
  31. The Data Digest: Digital Seniors from Forrester []
  32. Flurry Game Accerlation Program from Digital Analytics Association Symposium in June 2012 []
  33. China Internet Insights — Incitez, p.11 from China Internet Watch []
  34. See Table 3, p. 9 China Gaming Market End-User Survey, 2010 from IDC []
  35. See 2011年中国Android智能手机用户年龄分布 from iiMedia and 2011 年中国Android 智能手机用户年龄分布 from China Mobile []
  36. 中国iPhone用户用户年龄段偏成熟 from ChinaPP []
  37. China Mobile Internet User Age Distribution from China Internet Watch []
  38. 2010-2011年12月中國智能手機與非智能手機網民的年齡分布比較 from Askci []
  39. See China urbanization rate exceeds 50 percent from Xinhua, China’s Urban Population Exceeds Countryside for First Time from Bloomberg and Crossing the 50 Percent Population Rubicon: Can China Urbanize to Prosperity? by Kam Wing Chan []
  40. China’s Long — but Uneven — March to Literacy from The New York Times []
  41. Social, Digital, Mobile China (Jan 2013) from We Are Social []
  42. Part of the problem in terms of relatively low penetration rates has to do with the User Experience (UX) that is still being refined.  Phones like SafeTalk (“as seen on TV”) are designed specifically for seniors and others who may have vision difficulties. []
  43. Red Bull still waiting for approval to enter China from Just Drinks []
  44. Despite initial reports that suggested a new pilot program was starting at a casino in Sanya, Hainan province (called Jesters), gambling on the mainland is currently banned.  Macau is the only nearby domicile where this is allowed.  Mainland residents must still apply for an entry visa in order to travel to Macau and are typically only allowed to visit it a few times a year.  There are exceptions, for example, if you live nearby in certain cities of Guangdong or if you have relatives living in the SAR.  See Sanya Says It Never Licensed Any Form of Gambling Activities from Caijing, Chinese authorities close cashless casino bar in island resort from Reuters, Macau Casinos Decline on Visa, Credit Limit Concerns from Bloomberg, Macau’s Casino Revenue Reaches Record After Holiday Week from Bloomberg and China Tightens Reins on Macau from Bloomberg []
  45. Revenue hit $38 billion in 2012 and is expected to reach $44 billion in 2013.  See Rolexes Pawned in Macau Signal Further Gains for Casinos from Bloomberg, Macau gaming revenues hit $33.5 billion in 2011, no slowing seen from Las Vegas Review-Journal, Broken Tooth and New Macau from Foreign Policy and Door is about to slam shut on high-rolling holidays to Macau from The Times []
  46. Despite visa issues, MGM and other resorts continue to invest in building casinos on Macau.  See MGM to build new 15.5bn yuan casino in Macau from Shanghaiist []
  47. Qian Jianchu is also the editor-in-chief at China Commerce and Trade Press []
  48. See Empower elderly to be active participants from People’s Daily and Rise in China’s Aging Poses Challenge to Beijing from The New York Times []
  49. Targeting Grandpa: China’s Seniors Hunger for Ads from The Wall Street Journal []
  50. Big money bets on China growing old, and rich from Reuters []
  51. China faces ‘timebomb’ of ageing population from The Guardian []
  52. Growing old in China: The business of going grey from BBC []
  53. 7-star nursing home opens in Haikou from China Daily []
  54. See Nursing Facilities, Staffing, Residents, and Facility Deficiencies, 2001 Through 2007 from PAS Center and Nursing Homes from the AARP Public Policy Institute []
  55. Growing old in China: The business of going grey from BBC []
  56. See About Shanghai International Medical Center, Shanghai from Parkway Pantai and Covance China and Eli Lilly Pharmaceutical Signed an Agreement on Strategic Cooperation from SIMZ []
  57. For a detailed, illustrative case study on filial piety in modern China see: In China, Betting It All on a Child in College from The New York Times []
  58. 600 million middle-class Chinese by 2020: think tank from Xinhua []
  59. China’s middle-class boom from CNNMoney []
  60. While it may be momentary exception to the trend, the stereotype of “Chinese generational savers” may be coming to an end.  According to a recent CNN report younger Chinese consumers born in the 1970s and 1980s have a savings rate near zero.  Shaun Rein author of “The End of Cheap China” similarly observes that today’s “20-something generation” are veritable spendthrifts with “an effective savings rate of zero.”  See China youth have savings rate near zero from CNN and Getting Chinese to stop saving and start spending is a hard sell from The Washington Post []
  61. In terms of specific numbers, in Guangzhou, “[t]he Shouxing Building is the city’s largest private rest home and home to about 50 pensioners from Hong Kong.”  See Hong Kong elderly go north for retirement from China Daily []
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Chapter 7 – Exporting manufactured goods

[Note: below is Chapter 7 from Great Wall of Numbers]

When I was teaching at a college in Bengbu, Anhui there was a small supermarket across from the main campus entrance called Joy Mart (合家福).  While a new Carrefour had just been built downtown, most students and faculty still regularly shopped at the nearby Joy Mart due to its physical proximity.  While I had originally brought a number of extra spare shaving razors from the US and Korea (where I had worked previously) I eventually ran out and needed to shop for more.  During my first trip along the shop aisles, I noticed one razor package that stood out among the rest: “Blades: Made in the USA.”  I got a good chuckle out of it because of all things you picture as a US export, razor blades is probably not one of them.

Which brings up a good question: being the world’s 2nd largest exporter, what exactly does the US export?  Who does it?

In case you skipped ahead I mentioned in Chapter 1 that, in its August 2012 SME Viewpoint, the US Department of Commerce noted that small and medium-sized enterprises:1

  • Only 1% of US 28 million SMEs export to any country
  • And only 10% of those that export, export to China

If you are reading this, odds are you do not work for a company that exports products and services to China.  There may be any number of reasons why.  The same publication notes that legal uncertainties and property rights protection rank among the top reasons preventing US firms from doing business in China.

But what if you are willing to take the risk and attempt to generate revenue through customers in the 2nd largest economy?  How would you do it?

ExportNow is a turnkey solution provider founded by Frank Lavine, former U.S. Ambassador and Undersecretary of Commerce for International trade.2 It is a streamlined central sales platform that allows US firms – small and large – to export their products directly from the US all the way through customs into the hands of Chinese customers.  There is no need for warehouses or store fronts as ExportNow promotes and markets the products through China’s largest online retailer, Taobao (Tmall).345

Who goes shopping online in China and how much do they spend?  Nearly 60% of Taobao’s userbase is between 25-35 years of age.6 For comparison, according to Quantcast, nearly half of Walmart.com shoppers are under the age of 34 and more than a quarter of Amazon.com’s customer base is 45 years or older.7 To give you an idea of how large online shopping is in China and how fast it has grown consider that Boston Consulting Group (BCG) published last year noted, “nearly 173 million people in China shop [online], and the e-commerce space is expected to exceed $118 billion gross merchandise value for last year [2011].”8 In 2012 that increased further to $196 billion and 242 million shoppers.9 The BCG report also estimates that China’s e-commerce market will become the world’s largest in 2015, with 329 million online shoppers (each spending roughly $1,000 annually online).10 In fact, Analysis International projects that China’s e-commerce market will hit 2.57 trillion RMB ($410 billion) by 2015 and $457.6 billion in 2016.11 And Ali Research Center estimates that if B2B transactions are not included, by 2020 sales of consumer goods via e-commerce on the mainland will reach 10 trillion RMB ($1.61 trillion).12

And if you would prefer to look around for other e-tailers, in addition to Taobao, US firms looking to tap into the Chinese e-marketplace should also consider Yihaodian (an online grocery store), 51buy.com (a subsidiary of Tencent) and 360buy (which specializes in electronics) all three of which have had double digit growth rates over the past several years.13 And these are hardly fly-by-night operations.  For example, in February 2012, Walmart increased its ownership stake to 51% in Yihaodian and by December 2012 had over 20 million registered users and 400 supplier partners.14 And in October 2012, 360buy introduced its native English channel to allow easier access for international buyers and sellers.  Furthermore, In February 2013 Saudi Arabia’s Kingdom Holding’s investment group announced it had paid about $400 million for a strategic stake in 360buy.15

So the first step is less ambiguous as you now know who you can sell your wares to in China and how you can sell them.  Chapter 12 discusses the social media and social marketing aspects of promoting your products and services in China.  But what about services and supply chain improvements?

Industrial robots

While most Westerners are under the impression that you cannot compete with China’s millions of relatively low-skilled workers, there are still opportunities in the future.

For example, as its economy has developed, wages in China have increased dramatically as well (in economics this is called the Lewis turning point16 ).  According to Ernst & Young, “[t]he average labor cost in China has nearly doubled in the past five years, going to more than 40,000 yuan ($6,400, 4,900 euros) a year in 2011 from less than 25,000 yuan a year in the beginning of 2007.”17 In fact, these higher costs are forcing many Chinese firms to relocate and automation is becoming increasingly popular (see below).  According to one Chinese official, nearly one third of manufacturers in provinces like Zhejiang and Guangdong (who produce textiles, shoes and garments) have relocated overseas to neighboring countries in Southeast Asia such as Vietnam and Malaysia in a move that has been called “the great transfer.”181920 This is not to say that manufacturing on the mainland is faltering, in fact for the third year in a row, FDI reached over $100 billion in 2012 on the mainland spurred in part by firms trying to “move up the value-added chain.”21

As a consequence, firms such as Hon Hoi Precision (Foxconn), which make the iPhone and other electronic devices, plan to move inland to provinces where wages are lower and install 1 million robots in their new factories and plants by 2015.  For example, in 2011 Foxconn only used 10,000 robots throughout their factories yet planned to have in place 300,000 by the end of 2012.22 In fact, following the 2013 Spring Festival (春节), Foxconn announced a hiring freeze on the mainland where it currently employs more than 1 million workers.23 The company will use this time to install robots throughout their factories in Shenzhen and Zhengzhou, replacing manual labor.

In 2011, China as a whole was home to 74,300 robots, up 42% from 2010 due in large part to a collective acquisition of 22,600 robotic units.24 The number of industrial robots sold on the mainland quadrupled between the five years spanning 2006-2011.25 All told there are approximately 21 robots for every 10,000 workers on the mainland.  For comparison, Japan is home to the largest number of industrial robots (more than 250,000) giving it the highest density of robots to manufacturing workers (339 per 10,000).2627 Thus Chinese firms with robots, of which there are next to zero per capita, have a long way to go before such densities are reached.  One of the reasons why the robot per capita rate is relatively low is that at 140,000 RMB to 160,000 RMB ($20,000 to $25,000) a piece, these robots (or “Foxbots” below) cost more than four times the annual salary of an assembly line worker.2829  On the domestic side, Sun Zhiqiang is the managing director of Risong Group based in Guangzhou, Guangdong.  For the past 15 years they have been developing robotic automation systems and their revenue has increased 20-fold since it was founded due in part to firms switching as a result of increased costs of human labor.  This means there may be potential long-term opportunities for foreign robotic design firms, especially at lower price points.

While Foxconn plans to use domestically made “Foxbots” for some of the work, this trend towards automation provides possibilities for Western robotic manufacturers, designers and programmers to export their goods and services.  All told, 80% of robots currently being used in China are imported from abroad (in 2011 imports increased 62% to 38,000 robots).30 For example, to improve efficiency and reduce prescription errors, many US pharmacies like CVS have rolled out automated robots in pharmacies.31 Similarly, companies like Philips and Tesla Motors have installed robots that help load and unload shipments from trucks, saving time and reducing physical stress.32 Thus firms providing robotic solutions in these segments like pharmacies and shipping may find new customers on the mainland.

Do you or does your company currently design, manufacture or maintain robotic systems?  Perhaps you can find new clients in Zhejiang and Guangdong.  Cities like Yiwu and Dongguan are some of the largest and most developed manufacturing hubs in China and as a consequence are areas where workers wages have also risen.  In fact, because wages have doubled since 2007, the return on investment of installing a new robot may outweigh the costs of hiring relatively more expensive human labor.

A distributed decentralized manufacturing process

But what if you have a small business that already manufactures goods on a small scale?  How can you compete with large OEMs?

There is a disruptive technology on the horizon and currently moving out of hackerspaces, garages and hobbyist circles called 3D manufacturing.33 As futuristic and seemingly science-fiction as it sounds (and barring legal hurdles), 3D printers and rapid prototypers have finally begin to mature into economically viable tools.34

There are a number of ways a 3D printers can work, the most common of which now is ‘additive.’  Much like a printer nozzle lays ink, commonly used 3D printer nozzles add additional plastic layers on top of one another to build the widget.35 For example, using computer-aided design (CAD) software you can design a customized object like a plastic toy for your young nephew.  Using relatively inexpensive hobby kits or even professionally manufactured 3D printers, you send the CAD file to the 3D printer.  The 3D printer then builds this toy, layer upon layer – right in your home (giving it the nickname of “desktop manufacturing”).36 And as I mention below, several of these 3D printers are now sophisticated and versatile enough to build much more complex objects than your average, everyday coffee mug.

A new report from SmartPlanet suggests that 3D printing can “make global supply chains” increasingly unnecessary.37 The report notes that while the technology is still in its germination, maturing phase, the potential to decentralize manufacturing can save on transportation costs by completely removing the costs and time of shipping from China to the US.

For example, US-based manufactures, both small and large can now purchase relatively precise 3D printers from a number of vendors.  This includes the highly acclaimed MakerBot, Fab@home and Reprap among many others.3839 The award winning MakerBot allows users to turn CAD files into physical constructions, starting at $2199 (the top-end model is $2,799).  Thus if you currently own or work for a US-based manufacturer, regardless of size, you have the potential to build and export anything from miniature toy action figures and playable guitars, to goods of all shapes and textures such as automotive parts, football cleat, artificial ears, cell phone faceplates, stainless steel dice, James Bond cars, UAVs, fuselages, microscale figurines, prosthetics, face jugs, robotic dinosaurs, civil engineering dams, houses, life-sized robots, conductive thermoplastic composites (carbomorphs), marine life models, stem cells, lunar structures and even photo booths.4041

This also presents a good opportunity for independent entrepreneurs looking to start-up a part-time project.  For example, entrepreneurs do not even need to purchase 3D printers as they can contract the physical manufacturing process to a nearby fabrication owner, allowing the entrepreneur to simply design the product and export it to China or elsewhere.  One such US-based company that already provides this content-to-print service is 3D Systems.42

Other firms such as US-based Stratays will lease 3D printers and prototyping machines to users at a monthly rate.43 One business opportunity could be renting one of these Stratasys machines and subcontracting and in-sourcing work orders from both international and domestic clients.  For example, Staples, the office retailer, will begin to integrate and install 3D printers into its printing facilities beginning in Q1 2013 making subcontracting and decentralizing relatively easier.44

In terms of legal considerations, in February 2013 I spoke with Stephan Kinsella, an author and intellectual property lawyer specializing in patents.45 According to Kinsella, “3D printers are a disruptive innovation that will probably face substantial legal hurdles depending on the jurisdiction.  49,000 3D printing systems were sold worldwide in 2011 and even in the face of copyright and patent lawsuits I suspect that tens of thousands more will be sold.46 Furthermore just as bit-torrenting and encryption have enabled file-sharing as means to avoid copyright law, ultimately the prospect of 3D printing may do something similar for patents.  And just as the RIAA sued Napster, patent holders will unsurprisingly fight to prevent this innovative process from occurring as Wired and the EFF have pointed out.”  Wired recently showcased 10 patents that could stifle the homegrown 3D printing market and the EFF is a non-profit organization that has chronicled how patents stunt innovative advances.47 For instance, last November 3D Systems (noted above) sued Formlabs for patent infringement.48 Formlabs is a startup that plans to sell a new 3D printer based on a processing technique called stereolithography that 3D Systems claims to have patented.

Despite these legal issues Kinsella still sees business opportunities, noting that “once we have sophisticated 3D printers that can make copies of themselves like the RepRap project aims to do and are capable of printing out objects retrieved on the Internet from sites like Thingiverse via encrypted files, then patent holders will find it much harder to stop 3D printing which will lead to further proliferation and economies of scale as CAD files are distributed and decentralized globally.  The traditional manufacturing business model will eventually have to change either way and since two-thirds of all 3D printers are currently made in the US, there are still several ways profit from this disruptive innovation without the need to open a factory in China.  For example, any first-mover fashion trend such as designing a creative accessory (e.g., Lady Gaga-inspired purses) and being first to print, ship and sell it to a distribution channel or even to end-customers themselves.  Information, which is what CAD files are, will ultimately become “free” – so to futureproof your business model, entrepreneurs should factor in this change sooner rather than later.”  RepRap is an open-source 3D printer project with a goal of being able to build an identical copy of itself using everyday material (in situ).49 Thingiverse is a site facilitating the sharing and distribution of user-created digital files (CAD).50

Just how large can such the 3D manufacturing process be scaled?  On October 19, 2012, New York City mayor, Michael Bloomberg, cut the ribbon to a new Queens-based 3D manufacturing facility that will soon be home to 50 large industrial-scale 3D printers capable of producing millions of customized consumer goods.51 All told, Wohler’s Associates estimates that the 3D printing industry will be a $3.1 billion market by 2016.5253 And the Consumer Electronic Association estimates that printer sales would rise to $5 billion by 2017 (up from $1.7 billion in 2011).54 These goods can in turn be sold domestically, or as illustrated above, sold to Chinese customers through ExportNow or a variety of other e-commerce providers.

Would Chinese consumers be interested in buying your 3D printed objects?  Perhaps they might, depending on what it is.  For example, in 2011 mainland toy sales increased by 18%, generating $8.58 billion in revenue.  As a consequence Toys ‘R’ Us is not only expanding by building smaller brick-and-mortar stores but also stocking them with more education-focused products like toy microscopes because “[a]bout 35% of sales in existing stores in China are tied to education, compared with 21% in the U.S.”55 In fact, Lego, the plastic build block company, announced in March 2013 that it was building a new factory in China, its first mainland factory to cater exclusively to the Asian market; a market that has seen annual sales growth of Lego’s increase 50% for each of the past several years.56

But remember, even though the Asia-Pacific region is expected to become the world’s largest toy market in 2016 and just because you make a product that is popular in the West, does not mean it will also be popular in China.  For example, in 2009 Mattel opened a $30 million six-story flagship store in Shanghai that included not only the world’s largest collection of Barbie dolls but also other branded goods and services such as customized furniture and even a fashion runway.  Yet the store shut down two years later in large part because Chinese consumers prefer the “cuteness” of Hello Kitty over the “sexy” blonde icon.57 Thus, performing market research on consumer behavior is just as important in the East as it is in the West.58

Takeaway: In the US, only 1% of SMEs export and only 10% of these firms export to China.  This amounts to roughly 30,000 SMEs.  And odds are your company is not one of them.  Yet solutions like ExportNow make it easy for any American company to export and sell their products directly to Chinese consumers online via Taobao.  And because of labor arbitrage, developmental economics (specifically the “Lewis turning point”) and specialization, it is becoming increasing expensive to own, operate and scale manufacturing plants in hubs like the Pearl River Delta and Yangtze River Delta regions.  As a result, US firms specializing in automation (specifically robotics designers and producers) now have potentially new sources from which to generate sales.  In addition, US firms specializing in 3D printing also have the ability to disrupt and modify existing supply chains, enabling CAD designers in the US to compete directly with Chinese-made products (specifically just about anything made with plastic today).

 


Endnotes:
  1. See Opportunities for U.S. Small and Medium Business in the China Market from the American Chamber of Commerce in Shanghai. []
  2. It is called ExportNow.  I would like to thank both Eric Meng and Matt Garner for bringing this service to my attention. []
  3. While some Western sources consider Chinese auction e-tailers to be less than trustworthy, Alibaba (Taobao’s parent company) has implemented a number of policies to improve the quality, reliability and service of Taobao.  As a consequence it was recently removed from the USTR “notorious markets” list.  See Alibaba Group’s Taobao Removed From “Notorious Markets” List By U.S. from TechCrunch []
  4. Another reason to export is that the long-term potential for emerging market annual consumption is expected to reach $30 trillion by 2025.  See Winning the $30 trillion decathlon: Going for gold in emerging markets from McKinsey Quarterly []
  5. In Q3 2012, online ad revenue in China surpassed newspaper ad revenue: 14.53 billion RMB ($2.33 billion) versus 14.39 billion RMB.  See China Online Ads Market: Review and Prospect from China Internet Watch []
  6. Nearly 60% Taobao Shoppers Between 25-35 Year-old from China Internet Watch []
  7. See Demographic Differences Are Key in Amazon-Walmart Online Battle from CBSNews. For recent data from Quantcast see Amazon and Walmart []
  8. Wal-Mart Set to Cash In on Chinese Online Boom from The Motley Fool []
  9. See Bezos’ Kindle-Less Amazon Mashed in China by Ma’s Alibaba from Bloomberg and China Had 564 Million Netizens By End Of 2012; Fewer Using Desktop Computers To Surf from China Tech News []
  10. Saudi Arabia’s Kingdom Holding Invests in 360Buy Jingdong from The Wall Street Journal []
  11. See China Now Has 242 Million E-Commerce Shoppers, Spending $40,000 per Second from Tech In Asia, E-commerce in China – Statistics and Trends from Go-Globe []
  12. China E-Commerce Market to Reach 30 Trillion Yuan in 2020 from China Internet Watch []
  13. Over the past three years, sales at 51buy.com “increased by nearly 20 times.”  See Tencent Adjusts E-commerce Subsidiary Structure In China from China Tech News []
  14. Walmart’s Chinese E-commerce Initiative Takes Further Shape from China Tech News []
  15. Saudi Arabia’s Kingdom Holding Invests in 360Buy Jingdong from The Wall Street Journal []
  16. Named after economist William Lewis, this eponymous law describes the transition from relative subsistence to a modern industrialized economy with higher wages (e.g., capital accumulation leads to prosperity which leads to specialization away from subsistence agriculture).  See How to blow away China’s gathering storm from Financial Times, What Does the Lewis Turning Point Mean for China? A Computable General Equilibrium Analysis by Huang Yiping and Jiang Tingsong and The Lewis Turning Point in China and its Impacts on the World Economy by Andong Zhu and Wanhuan Cai []
  17. The rise of the robots from China Daily []
  18. See Economy Higher costs forcing firms to relocate from China Daily, Chinese Graduates Say No Thanks to Factory Jobs from The New York Times and What Worker Shortage? The Real Story of China’s Migrants from The Wall Street Journal []
  19. On the other hand, remaining factories may be moving up the value chain.  See Analysis: Investors make $100 billion bet on China’s drive up value chain from Reuters and China Still The Place For Manufacturing from ChinaLawBlog []
  20. Mexico is increasingly competitive in manufacturing as the maquiladora’s in border cities continue to grow in experience and talent.  See Mexico: The New China from The New York Times []
  21. For example, Samsung is investing $7 billion to build a chip plant in Xi’an and another $1.7 billion to expand production capacity at an existing plant in Kunshan, Jiangsu.  See Analysis: Investors make $100 billion bet on China’s drive up value chain from Reuters and Samsung Ups Chinese Manufacturing Investment from China Tech News []
  22. Will your next iPhone be built by robots? from IT World []
  23. 富士康暂停招工机器人将上岗from Sina []
  24. Another estimate puts the increase at 51%.  See Chinese robot wars set to erupt from China Daily []
  25. Ibid []
  26. See What’s Behind Japan’s Love Affair with Robots? from TIME and The Rise of the Machines from IEEE []
  27. Another robot that could potentially assist both the elderly as well as manufacturers is Baxter.  See Small Factories Give Baxter the Robot a Cautious Once-Over from MIT Technology Review []
  28. The average salary for assembly line workers in Guangdong is typically around 30,000 RMB a year.  See 富士康机器人上岗:每台成本14万 智商七八岁 from TechWeb []
  29. Another estimate from Wang Tianmiao, head of the State High-Tech Development Plan is that “a typical industrial robot costs around 300,000 yuan and has annual maintenance costs of 20,000 yuan. The total layout of 500,000 yuan over 10 years is considerably less than that for a 6,000-yuan-a-month technician, and robots can work three times more efficiently.”  See Chinese robot wars set to erupt from China Daily []
  30. Ibid []
  31. Will Robots Steal Your Job? from Slate []
  32. Skilled Work, Without the Worker from The New York Times []
  33. Hackerspaces are small, community owned shops typically owned, run and managed by hobbyists (like independent researchers and engineers) to allow for tinkering and education.  China now has several hackerspaces including perhaps its best known, XinCheJian in Shanghai.    See Created in China by Silvia Lindtner and David Li []
  34. How Big Business is Stymying Makers’ High-Res, Colorful Innovations from Wired []
  35. You can even used recycled plastic to refill the spool used in a 3D printer with the new Filabot which successfully completed its Kickstarter goal.  See Turn Your Plastic Recyclables Into 3D Printing Spools With Filabot from Singularity Hub []
  36. See The Desktop Manufacturing Revolution from Fast Company, Desktop Manufacturing’s ‘Macintosh Moment’ from Wired, Disruptions: On the Fast Track to Routine 3-D Printing from The New York Times and Print me a Stradivarius from The Economist []
  37. See 3D printing may put global supply chains out of business: report from smartplanet, Mr. China Comes to America from The Atlantic, The Insourcing Boom from The Atlantic, 3D Printing and the Future of Shopping: Shapeways CEO Peter Weijmarshausen from Reason, Big Data and cloud computing empower smart machines to do human work, take human jobs from The Washington Post and What’s the Deal with Copyright and 3D Printing? from Michael Weinberg []
  38. The New MakerBot Replicator Might Just Change Your World from Wired []
  39. There are more than a dozen publicly released 3D printers available to consumers.  See The shape of things to come: A consumer’s guide to 3D printers from Engadget and Formlabs Co-Founder Describes Their Stereolithographic 3D Printer from Slashdot []
  40. See Completely Customizable 3-D Printed Figurines from Wired, The World’s First 3D Printed Guitar from BusinessWeek and voxeljet builds Aston Martin models for James Bond film Skyfall from 3ders []
  41. Student Engineers Design, Build, Fly ‘Printed’ Airplane from UVAToday, Everything you need to know about the Lumia 820 and 3D printing from Nokia, Microscale 3D printing of a spaceship from Nanoscribe, Weighted Companion Cube Die – Stainless Steel from Etsy, 3D Printed “Exoskeleton” Lets a Little Girl Lift Her Arms and Play from Stratasys,  Robohand: How cheap 3D printers built a replacement hand for a five-year old boy from ArsTechnica, A Simple, Low-Cost Conductive Composite Material for 3D Printing of Electronic Sensors from PLOS One, Nike launches its first 3D-printed football cleat from Engadget, Bioengineers print ears that look and act like the real thing from Chronicle Online, Recreating 19th-century face jugs with 3D scanning and printing technology from BoingBoing, Robotic Dinosaurs On the Way for Next-Gen Paleontology at Drexel from Drexel NOW, Honey, I Shrunk the Dam! from US Army Corps of Engineers, Dutch architect to build “endless” house with 3D printer from 3ders, Print your own life-size robot for under $1,000 from CNN, 3D printing: The world’s first printed plane from NewScientist, Airbus Explores Building Planes With Giant 3D Printers from Forbes, Colony: beautiful 3D prints, reminiscent of marine life-forms from BoingBoing, Edinburgh scientists use 3D printing to produce stem cells from BBC, Foster + Partners works with European Space Agency to 3D print structures on the moon from Foster + Partners and 3D Printing “Photo Booths” Popping Up Across the World from Singularity Hub []
  42. 3D Systems []
  43. Stratasys []
  44. Staples to Use Mcor IRIS in Copy Centers from Fabbaloo []
  45. KinsellaLaw []
  46. New Industry Report on Additive Manufacturing and 3D Printing Unveiled from Wohler Associates []
  47. How Big Business is Stymying Makers’ High-Res, Colorful Innovations from Wired and EFF []
  48. 3D Systems Sues Formlabs and Kickstarter for Patent Infringement from Wired []
  49. RepRap []
  50. A free open-source repository of CAD files for 3D printing is actively maintained at Thingiverse and Autodesk recently released an iOS app called 123D Creature that allows users to design and print 3D creatures. []
  51. See Giant 3-D Printing Factory Opens In New York City from Popular Science and Inside The World’s Biggest Consumer 3D Printing Factory from Forbes []
  52. Next Year’s 3-D Printers Promise Big Things — Really Big Things from Wired []
  53. Stratasys recently merged with Objet to become the largest 3D printer company (ahead of 3D Systems).  See After Merger, 3D Printing Industry Has A New Leader from SingularityHub []
  54. Domestic research and development of 3D printing is a nascent industry on the mainland.  According to Wohler’s Associates, two-thirds of 3D printers sold in 2011 were made in the US compared with just 3.6% from China.  See China’s 3D Printing: Not a Revolution – Yet from Caixin []
  55. Toys ‘R’ Us Grows in China, With ‘Tiger Moms’ in Mind from The Wall Street Journal []
  56. Lego Ramps Up Production for Asia from The Wall Street Journal []
  57. See Why Barbie Stumbled in China and How She Could Re-invent Herself from Forbes and What do Chinese consumers want? Not Barbie from CNN []
  58. In addition to studying the 250 million members of the emerging middle class and their shopping habits, another area of potential research involves that of the consumer behavior of only-children which may impact the sales of the goods and services from your company.  See Ambition and angst: inside China’s middle class from The Times and Little Emperors: Behavioral Impacts of China’s One-Child Policy from L. Cameron et. al. []
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