March 29, 2011, Forbes
One dirty if open secret to the turbocharged growth of Chinese Internet services is that they have been convenient portals to piracy. Youku and Tudou became famous for their troves of pirated movies and television shows on their way to leading the Chinese online video sector. Taobao became the go-to Web marketplace in China for counterfeit goods while becoming the go-to Web marketplace in China, period. And Baidu’s reputation for full service in enabling users’ quests for pirated content — such as larding search results with mp3 links for one-stop downloading — helped the Chinese search engine to its dominant perch.
Baidu’s billionaire co-founder and CEO Robin Li, the richest man in China with $9.4 billion, is viewed by some as the Chinese Internet’s pirate king. In recent days, Li has faced a swell of criticism that he built his fortune in part by stealing from the poor, or more precisely, by allowing others to steal from the poor — in this case, Chinese authors whose works have been pirated en masse via user uploads to Baidu’s Wenku (Library) service. It is like a Napster for books, only if Napster were owned by Google. (Google Books operates under a different, if also controversial, model, the most important difference being it does not allow users to download the entire text of copyright-protected books.)
Baidu says it is working to address the writers’ concerns, reviewing its library for pirated books with the intent of taking them all off the site. Li said in Shenzhen yesterday that if the problems with Baidu Library can’t be fixed, he’ll shut it down. But the reason Li and Baidu are in this public relations mess now is because, for years, they behaved like many Chinese businesses, consumers and government officials: They exhibited a casual disregard for piracy, in a culture and economy that did not value intellectual property. (The same goes largely for expatriate consumers, including myself, who moved to China and all too quickly and eagerly adapted). Piracy proliferates in virtual China much as it proliferates in bricks-and-mortar China, and for the same fundamental reason, because it is rewarded.
Robin Li’s problem, in other words, is China’s problem, inherited from a time when its consumer market and economic power were small and weak, when there were virtually no significant Chinese brands and no Chinese billionaires. Times have changed, and it is long past time for Chinese companies, consumer culture and official attitudes to change. Some companies are beginning to do their part. Youku, at the behest of government regulators, has finally gone a long way to cleansing the site of pirated movies and television shows. Merchants still use Taobao to hawk counterfeits, and the site was listed recently by the U.S. Trade Representative as a “notorious” marketplace for piracy (along with Baidu). But Taobao has at least become more responsive in the last year to complaints from brand owners, taking down 14 million listings in 2010, and analysts at iResearch say such measures are slowing down the e-commerce platform’s transaction growth.
Today this China problem is still very much Robin Li’s problem, and as the wealthiest Chinese entrepreneur in charge of China’s most valuable Internet company, he needs to be a leader in fixing it. The heretofore unsympathetic boss of a company whose motto should be, Baidu’s critics say, the obverse of Google’s — “be evil” — Li has an opportunity, now that he has made his billions, to be good.
Li’s greatest misfortune to date (if he has any) is that his enemies know how to write, and they are led by the wickedly sharp poison pen of Han Han, one of China’s most popular bloggers. Han Han, a best-selling author of cutting satire before he turned 20, then a successful race car driver, is no poor man himself. But he has taken up the cause of the thousands of much poorer writers who, thanks to the long tail of Web piracy enabled by services like Baidu Library, have an even harder time making a living. Han Han wrote two blog posts in recent days accusing Baidu and Li of arrogantly taking money out of writers’ pockets, under the headlines “Shame on Baidu” and “A Letter to Robin Li”:
Baidu came around at exactly the right time, because only in this day and age can you violate the rights of authors, composers and film makers at will. Obviously, more important yet, Baidu also came around in exactly the right country, since only in this country can you still find refuge after violating the rights of almost the entire cultural industry.
Han’s letter to Li is no more kind, but in it he offers Li and Baidu a chance at something more than redemption:
Baidu Library could very well become the basis for the wealth of Chinese authors, and not the grave in which they are buried…
You are now the country’s number one entrepreneur. As a role model for others, the time has come to make your position known on the damage done to the publishing industry by Baidu Library…
This can be read more broadly as a call to arms. Chinese Internet entrepreneurs, with the helpful neglect of authorities, tolerated or enabled piracy for years while their companies grew and made them billions. Now they need to be role models, leading the way from an economy that rewards piracy to an economy that rewards originality.
- Why is piracy so rampant in China?
- Why should intellectual property rights be protected?
- Do you think it’s morally wrong to download pirated books or movies from the Internet?