Tech talk to help with China-US discussions

By Gao Yuan (China Daily) Updated: 2015-09-24 07:34

US tech companies are facing a tough time in China as Beijing is showing a greater concern over information security. IT providers such as Cisco are already feeling the pain.

Cisco CEO John Chambers said earlier that orders from China fell by 20 percent during the quarter ended in April because of Sino-US security tensions. Many Chinese buyers turned to Chinese providers such as Huawei Technologies to avoid potential security vulnerabilities and regulatory troubles.

The company subsequently pledged a $10 billion investment in China in mid-June supporting innovation among Chinese companies. The show of commitment to the market may help the company bring back some swing customers.

Researchers said the US tech giants should grasp the chance to make their points to the Chinese leader.

Gene Cao, a senior researcher at industry consultancy Forrester Research, said many US tech companies are starting to find new ways to tap the Chinese market amid an economic slowdown and policy change.

"Teaming up with local partners will greatly reduce risks, and injecting investment gives China a sign the company has a long-term development plan in the country," Cao said.

Besides Cisco, a lot of US companies have already increased their investment in China ahead of Xi's visit.

In May, Hewlett-Packard put its server, storage and service units in China into a joint-venture with a State-owned company Unisplendour Corp.

Dell, a Texas-based computer maker, also announced five-year investment plan in China two weeks ago to improve innovation among Chinese companies and boost demand for tech devices.