Those Years When I Was Forced to Top the Forbes List

Chapter 304 Showdown (6K7)

"You want us to not sue each other?" Jobs probed.

"Are you sure you want to continue this legal battle with me, or do you really think your iPhone is superior and has revolutionized mobile phones?"

"Of course, our touch interaction is better than yours. Apple didn't change the phone, it reinvented it."

"It seems you haven't realized that smartphones are just tools. Then go and reinvent the phone. What I want to reinvent is life."

"Wait! You mean SDK (Software Development Kit)? That's not difficult! We can make that too! Your software ecosystem isn't much larger than mine!"

"Really? It seems you still need to get to know me better."

Chen Xuebing asked again with a confident smile, and Jobs frowned slightly, not rushing to confirm.

As soon as Jobs returned to the team, he received news:
Kirin phones are equipped with 3G functionality.

This puzzled everyone on the Apple team because China does not currently have a 3G network, and incorporating a 3G chip would significantly increase power consumption and make it bulky, making it difficult to integrate into a slim and lightweight design.

He left silently with his team to the hotel, where he ordered the collection of all information about Chen Xuebing.

This is indeed a difficult task for Apple, because in 2005, Apple China was involved in financial fraud. In a fit of anger, Jobs fired the entire management team of Apple China. If it weren't for Cook's insistence, he wouldn't have even planned to keep Apple China, so now only a bunch of remnants are providing him with support.

He had to call some people he knew.

In the evening, Chen Xuebing was watching TV with Yang Qingyue in his arms in the Xuefu residential area when he suddenly received a call from Jack Ma.

What he said surprised even Chen Xuebing.

"Dude, you're awesome! Even Steve Jobs called me personally to ask about you! What did you do?"

Chen Xuebing raised an eyebrow: "You know Steve Jobs?"

Yang Qingyue turned off the TV, but Chen Xuebing shook his head, got up, and went into the room.

Jack Ma, spitting as he spoke, said, "Pshaw, I even know George W. Bush! Many business tycoons know me! I used to travel to the US frequently a few years ago, you know that?"

"I know, but he went and started bragging."

"It was a speech! Last year I attended Stanford University's commencement ceremony, and he gave a speech on stage! Afterwards, I visited him and we talked for about an hour. This old guy looked down on Chinese people, and kept asking me questions about Shenzhen, Made in China, mobile phone manufacturers, and parts, but he didn't talk to me about the internet at all! He completely looked down on the development of the Chinese internet! But then again, he was born in that era, when the whole world was in the Cold War, and his understanding of us was all about anti-technology, anti-construction, and anti-market stereotypes."

"Can you get to the point?"

"He asked me, 'Why did you invest in Alipay?' He also asked if I knew about your investment in Spreadtrum! Don't worry! I didn't reveal a single word!"

"Oh, it's okay, you can tell him."

"what?"

“I said, tell him everything you know, the more detailed the better.”

The following day, a weary-looking Jobs reappeared at the SEG Plaza.

He wasn't even in the mood to attend the opening ceremony of the China Hi-Tech Fair.

Over the past day, the Apple team provided him with a summary of Chen Xuebing's investment portfolio, which included not only online shopping, but also payments, video websites, online healthcare, and games.

He also received information from two key figures.

One of them was Irwin Jacobs, the founder of Qualcomm, whom he respected. After discovering Chen Xuebing's investment in Spreadtrum, he conducted an in-depth study of Spreadtrum's involvement in 3G, but there wasn't much information available online. So he asked Irwin about Spreadtrum.

Qualcomm has extensive intelligence networks in the communications field. Ivan, who has a good relationship with him, revealed to him that China's 3G standards are being integrated, and that Spreadtrum recently replaced Datang Telecom as the dominant player. They and China Mobile are among the driving forces behind this, and are trying to implement the early deployment of the TD standard by building a test network. Meanwhile, Qualcomm is trying to lobby the US government and the WTO to put pressure on China.

After learning about this, he remembered Jack Ma through Chen Xuebing's investment information in Alipay and called Jack Ma.

I asked some questions about Alipay, and also inquired about Spreadtrum.

At first, he gained nothing, but then Jack Ma called him back and explained in detail Spreadtrum's current status and Chen Xuebing's plan to cooperate with him on online payment. Alipay will soon develop the Kunlun system mobile software and launch mobile payment.

Jobs felt a chill run down his spine upon hearing this, deducing that Chen Xuebing might have given similar instructions to other companies he had invested in.

He was not unaware of the mobile internet trend; in fact, in a 1996 interview, he foresaw its widespread adoption, stating that "internet dial tones will be ubiquitous," and predicting trends such as e-commerce and cloud services.

But he thought that 3G networks should be developed step by step. Apple signed an exclusive operating agreement with AT&T, but AT&T's 3G network construction was lagging behind, and Apple was now forced to use the EDGE network.

He thought that the problems Apple was facing were the same for everyone else.

However, a person emerged in China who boldly solved what he considered an insurmountable problem and, through investment, initially built a genuine internet ecosystem.

Apple's dream of "reinventing the phone" may no longer exist, as that Easterner has already taken the lead with a higher-level proposition of "reinventing the mobile internet and tools."

He even figured out why Chen Xuebing recorded that pointless video: it was to prove that Kirin phones were the first to build a mobile internet ecosystem. Even if he went back and ordered his colleagues to speed up the launch of the Apple Store and negotiate 3G, it would only further solidify his identity as a plagiarist.

Whether Apple has created a new tool is questionable.

Apple may be destined to decline, becoming a money-making machine like Nokia, rather than a creator of new eras.

Having figured all this out, the moment he entered Chen Xuebing's office, he said with a mixture of frustration and malice:

"You! You knew we were making phones all along! What were you planning to do by orchestrating my trip to China?"

He was certain that since Chen Xuebing had such grand ambitions and such long-term plans, it was impossible for him to come to China and learn all this just because of a request from the president of Huawei.

It can only be due to a deeper reason.

Chen Xuebing was stunned for a moment, then gradually smiled and called Ren Ying to translate.

When Ren Ying arrived, he began to try to communicate in English, with Ren Ying providing supplementary information.

"You guessed right, we knew all along. We searched all over the world and found your custom screens at TPK. Through these screens, I've figured out what you're up to, and by checking when you placed your order, I've also learned about your R&D progress."

This was true, and even Ren Ying, who was standing next to him, did not doubt it.

Chen Xuebing didn't know much about Apple's first-generation supply chain, but he kept asking Singularity Supply Chain to pay attention to the suppliers' production capacity. Although TPK didn't reveal anything, it was inevitable that they would mention in the negotiations that they had recently received orders that had taken up most of their production capacity.

In the late 90s, TPK fully shifted to the research and development of capacitive touch technology. It was not a big company and its business was always just average. You can guess where the huge orders that suddenly fell into their laps came from.

This reasonable explanation calmed Jobs's wild speculations.

Yes, besides a screen, what else could possibly expose them?
“Don’t worry, Steve.” Chen Xuebing stood up and smiled, “I’m here to discuss cooperation, of course.”

"Cooperate on what?" Jobs asked in return.

"Supply chain," Chen Xuebing said frankly, "We have worked very hard to build up our supply chain this time, and we still haven't secured Samsung's internal screen production capacity. That's why our screen colors are a bit worse than yours. You should know the reason behind this. I want to share the world's advanced supply chain through comprehensive cooperation with you."

Apple will find out about these things sooner or later, and if negotiations don't go well now, Apple will definitely cause trouble and sign exclusive agreements or something similar with those suppliers.

It's even possible that attacks could begin within the supply chain of this generation.

Given the current situation, cutting off the supply would be an unbearable burden for Singularity.

"I understand."

Jobs smiled, sat down on the sofa, and thought of a deeper reason: "You're afraid. You're afraid of America."

He said this very directly, hoping to strike at Chen Xuebing's heart.

Chen Xuebing shrugged and bluntly admitted: "Of course, if you didn't have the powerful United States behind you, you wouldn't even have the chance to negotiate with me. I would use my utmost respect to wipe you out."

“You can’t get into the American market,” Jobs said with a determined look in his eyes.

“Yes.” Chen Xuebing nodded in agreement: “But besides that, you don’t have much left.”

The reason why Kirin phones couldn't enter the US market wasn't actually due to reasons like US policy exclusion, as Jobs believed, but rather because it was decided the day the TD standard was chosen.

The Qilin can't even get into Europe.

However, this does not mean that the Kunlun system cannot be accessed.

Of course, these were still classified information that couldn't be told to Jobs.

As the information gradually became clearer, Jobs' frustrated mind began to stir.

"You're afraid we'll cut off your supply chain and prevent you from producing smartphones, but what can you offer us if you cooperate with us?"

“No, you’re thinking the wrong thing,” Chen Xuebing laughed. “I won’t be unable to produce them. In fact, you should know that I’ve already invested in the supply chain. The only cost of this replacement is that my phones will be temporarily a bit inferior, but that won’t affect my role in leading the concept of ‘mobile internet.’ In this respect, you will still lag behind me.”

"Moreover, my supply chain is developing in a direction that is specifically for smartphones. They are receiving my guidance and their development will be much faster than other manufacturers in the world. When I mentioned sharing the supply chain, it was not a one-sided contribution from you. With the cheapness and efficiency of Chinese products, you may soon be able to use my supply chain. Otherwise, Apple's costs would be much higher than ours."

These words silenced Jobs once again.

He knew Chen Xuebing had invested in BOE, but it seemed there was more to the story than he had investigated. Indeed, based on his assessment of Chen Xuebing, if Chen was involved in the supply chain, it shouldn't be limited to just screens.

The other party really is ahead of the game in everything.

“You dare to tell me all this?” Jobs frowned deeply. “You should know that if I tell the US government this, all your plans will be in trouble.”

Chen Xuebing laughed: "You don't need to threaten me. This isn't in your interest. First, we can contact the government. If the two countries break their current good relations and enter into a technological confrontation, Apple will permanently lose the Chinese market and cheap manufacturing support. I suggest you learn about the potential of the Chinese market through the upcoming sales of Kirin phones. Second, you will also lose your status as the 'great leader,' and I will definitely do everything in my power to belittle you."

If he hadn't thoroughly understood Apple and Steve Jobs, how could he have dared to openly reveal these things?

Apple is making a lot of money now. Although their iMac computers are not widely accepted in the Chinese market, the iPod has fans all over China.

A new iPod, in an era where the base price of MP3 players has dropped to 128 or 168 yuan, can still sell for 1200-3000 yuan. There are even scalpers raising the price by several hundred yuan to hype up new products. This is the brand power of Apple in China.

Greater China (mainland China + Hong Kong, Macao and Taiwan) is their third largest market globally.

Jobs had to admit that Apple, as a business, shouldn't have gotten into this kind of trouble, but to Chen Xuebing's last question, he retorted with a hint of bitterness:

"Didn't you already intend to take away the title of 'Great Leader'?"

"Things that haven't happened yet can still be changed."

Chen Xuebing smiled with his hands behind his back: "I know your predicament. Yesterday, our people discovered the frequency hopping problem on your mobile network. Perhaps there are other issues as well? Your mobile phone's system kernel is self-developed, right? It needs some time to ensure stability. Don't worry about these issues. We can hold this Shanghai press conference together."

Jobs was caught red-handed, and he became increasingly angry as he listened, but in the end, he was stunned.

"Us versus you? How do you plan to operate? Do you want to compare your product with ours on-site?"

Chen Xuebing smiled and shook his head: "That's not what I meant. What I meant was that Apple doesn't need to release a product. Instead, we invited Apple founder Steve Jobs to the press conference as close partners and claimed that we jointly developed a multi-touch smartphone and that Kirin has learned a lot from Apple. In this way, the better Kirin sells, the higher Apple's reputation will be, the more the US market will expect from you, and you will have ample time to add 3G and the Apple Store to the phone, presenting it to the market in a more perfect form."

After saying that, Jobs went from frowning to remaining silent for a long time.

His initial reaction was surprise, followed by calm reflection, and then boundless admiration.

What a smart guy.

What an incredibly clever "cooperation".

Through this collaboration, an unknown new brand can embrace Apple's global brand power, thus numbing the US government's judgment on the control of new technologies and enabling it to gain unchecked access to the global supply chain through Apple.

“This price isn’t enough,” Jobs said, still feeling resentful. “You’ve gotten too much, and Apple has gotten too little.”

"In a win-win negotiation, the losers are always on the sidelines. Why worry about who gets what? What you gain depends on how well you perform. I'm giving you an opportunity! If we don't cooperate, we all lose!"

Chen Xuebing shook his head with some disappointment, saying, "If your American partner had given you this opportunity, you certainly wouldn't have refused. It seems you still don't intend to be true friends with me, Steve. I'm very disappointed. Before this, I always thought that although we were in different countries, we shared the same goals. In China, such a relationship is called 'comrade,' or even 'comrades-in-arms.' We were 'comrades' plus friends, or even 'comrades-in-arms' plus brothers."

Chen Xuebing spoke in Chinese. Ren Ying paused when she blurted out the socialist term "comrade-in-arms" before changing it to the more relatable Western term "battle-forged brotherhood."

She felt she should strengthen her understanding of context in order to cope with future situations.

Jobs immediately noticed the accuracy of Ren Ying's translation and then smiled easily.

He was able to laugh because he also felt this was a huge opportunity for Apple.

Kirin opened up new avenues for him, and Apple can learn from it.

Apple could also enter the mobile internet industry by acquiring controlling stakes in internet companies that develop iPhone OS software, thereby gaining control of both the East and the West.

As for how to make a profit and how to collect Apple tax, he had already thought about it. The Western credit card payment system is more sophisticated than that of the East.

“Mr. Chen, personally, I admire you, but this is a business matter, and we’re talking business—your phone and everything else cannot enter the United States and Europe.”

Jobs used "All the things" here, which naturally included the system.

Chen Xuebing cursed inwardly, then smiled helplessly: "I wish I could do that, but there's no way around it. My system's underlying architecture is Linux, and according to the GPL license, it must be open source. Of course, if you're willing to provide me with your kernel and development rights, I can agree to your terms."

Jobs gave a knowing look.

The Kirin phones they saw deliberately hid kernel information, and the UI also concealed the obvious features of the interaction layer. They couldn't test it, but they guessed that it should come from a mature underlying system.

But he asked with a look of disbelief, "Your system services are also based on GPL? You haven't implemented any defense plans?"

Chen Xuebing smiled and stopped arguing: "How about this, I guarantee that my Kirin phones will not enter Europe and the United States, and my system services will not be open to the United States. This will be the basic condition for our cooperation. In fact, if you insist on making a closed-source system, sooner or later an open-source system will share the market with you, because other manufacturers need it. If that open-source system is Google, you may have even more headaches. Why don't we destroy it in the cradle?"

His original plan was not to fully integrate the Kunlun system into the United States, which could have raised serious concerns among the US government.

However, he still modified the underlying Linux system, which must be open source, in a very respectable way. He wanted to use the GPL to force open source and "passively" hand over the underlying system to those American manufacturers, so that they would develop it themselves, fight among themselves, and severely squeeze the space for Android's growth.

As for Europe, it is a disorganized mess. China is also continuously making strategic moves there. As long as the United States does not take the lead in making a statement, it will be the battlefield where the US can run rampant.

The reason Kirin phones can't get in is simply because they lack WCDMA technology. He will arrange for other domestic manufacturers to contact Qualcomm and Ericsson.

They're now vying with Jobs for the "American market" simply to avoid him imposing new conditions.

Even the most brilliant Steve Jobs was always shrouded in mystery when it came to his predictions about the future. He smiled knowingly and said, "I don't think even Google will be as troublesome as you. I don't want to see you in the United States, and neither will I want to see you in the United Kingdom."

He thought that this was all he could fight for.

Chen Xuebing did some mental calculations. Britain was America's backyard and one of the few countries with a large trade surplus with the United States. American-made products and services had many advantages when flowing into Britain, including the ultra-low tariff of 1.7%.

Based on these conditions, he decided to hold off for now and wait until he had established his own supply chain.

He sighed softly, "Let's first lay out the basics of the cooperation, then discuss the specific details before we talk further, okay?"

"Ok."

Jobs' expression softened slightly. He stood up and shook hands with Chen Xuebing, his knuckles tightening slightly, but his gaze remained cautious.

“Mr. Chen, I know that you Easterners value strategy, but we value the spirit of contracts even more. I hope you will stop scheming against us, otherwise breaking the contract will be a loss for both of us.”

Chen Xuebing shook his head and said sincerely, "Steve, I wouldn't scheme against a friend. Let's leave these hurtful words here. We should talk more about 'Tao' and 'Law,' and work together for the progress of humanity. Besides, since we're in China, why not take some time to relax and rejuvenate? This place has its own unique charm."

Jobs' expression relaxed, and he looked at Ren Ying: "It seems I'll be staying here a few more days. May I ask this intelligent lady to be my translator?"

"That would require asking Ms. Ren, but in China, it's best to use the word 'beautiful' to address women; it sounds more pleasant."

After Chen Xuebing finished speaking, Jobs gave a matter-of-fact look and said, "She's beautiful! I thought that was self-evident."

Ren Ying smiled and nodded: "Mr. Jobs, I'd be happy to explain Chinese culture to you."

After Jobs left, Chen Xuebing smiled and took out his phone to dial a Beijing number.

"Mr. Wang."

“There’s a company in Taiwan called TPK that makes capacitive touchscreens and touch systems. You should keep an eye on them recently. They might get into a lawsuit, which could be an opportunity for BOE.”

"Yes, if you need money, come to me. We can increase our investment."

night.

Chen Datong and Chen Xuebing, who had just attended the opening ceremony of the China Hi-Tech Fair, were sitting at a night market stall eating skewers and drinking beer.

Chen Datong was quite moved.

"Look at IBM! They sold their PC business to Lenovo and they're still making so much money in China. The entire banking system uses their database. Today, when they were showcasing their new products, more than a dozen banks signed contracts on the spot—hundreds of millions of yuan!"

The dazzling array of foreign high-tech products at today's exhibition, and the scene of numerous organizations scrambling to buy them, left him, someone who had returned to China to work on domestic substitution, with a sour feeling.

He might not have felt this way before, after all, he was also a beneficiary of advanced Western technology. But his stance is always changing. Now that his fate is more and more tied to domestic technology, his feelings will become more and more profound.

Chen Xuebing smiled and said, "This money should be earned by others. Our modern financial system was built with the help of the West. We still haven't been able to completely get rid of paper ledgers and financial databases. Whether it's DB2 or Oracle, they all belong to them. The management experience also belongs to them. The ability to replace them with domestic products is almost zero. If we didn't have these things, what would happen if the wealth that ordinary people have worked hard for decades to accumulate turned to zero in an accident? Bank runs, local chaos."

The West's technological monopoly over China, especially in the chip industry, is just the tip of the iceberg. If the West were to turn its back on China and withdraw its technology, it would be a disaster for many industries.

Chen Xuebing constantly faces these consequences, and he has to be cautious in many things.

Chen Datong lowered his voice again: "Jack Ma from Alibaba came today and chatted with a few of us. He even mentioned something about 'moving away from IOE.' 'I' stands for IBM servers, 'O' for Oracle server systems, and 'E' for EMC storage devices. Jack Ma is more visionary than Mr. Liu. It's laughable that Mr. Liu is still going around introducing his 'friends' from IBM. I think Lenovo might get ripped off by foreigners again in the future."

"Hehe." Chen Xuebing shook his head and said, "Don't say anything that might hinder unity. It's not good for others to hear. President Liu might be able to help. Jack Ma is probably here to see Steve Jobs today, right? This guy can talk big and get things done, but he's willing but not capable. The slogan of 'Going to IOE' is very big. Jack Ma doesn't have the hardware strength. He probably can't be a leader yet. Spreadtrum needs to grow quickly and contribute its share as a main force."

Chen Datong laughed: "I knew it. You're the most farsighted one. Just hearing a few words from you makes me feel much better."

Chen Xuebing raised his glass, gazing at the shimmering moonlight within, and laughed, "Then I'll make you even more comfortable? Drink up! If the sky falls, I'll hold it up. As for time, don't rush it. Remember, every towering tree begins as a seed that no one cares about."

"Hahaha, let's do it!"

The crisp sound of glass colliding startled the cuckoo on the roof.

(End of this chapter)