First, we are entering the age of open platforms, mobile computing, pad devices, open-source and cloud computing. These will create many opportunities for talented Chinese I.T. professionals.
That is all good, but so long as the verry network and the business around it are regulated by the whims of plitics no amount of open and free systems will correct the lack of free flowing ideas. If anything China should be a model to the US about how restriction of access will hurt our businesses globally, while China may be prevailing in their home market, they are not a global exporter of software, for the very reason that I highlighted. There is a lack of trust in the software that they produce. Until that is rectified they will be serving a regional software market at best.
Second, development costs are the lowest in history. On the open platforms, four or five good engineers can build an application and validate it in just a few months.
Development cost are not the biggist issue, if they where we would not be seeling the explosion in compensation in the US that we are seeing, talent in our field can be far more valuable that a team of mediocre, cheap developers. Please don't misread that as me saying Chinese developers are mediocre, that is not my intent, what I am saying is that the concept of development labor price is a none issue when one knows the dynamics of the software development market.
a Chinese e-book is free at first, but once you read half of it and get hooked, you have to pay a nominal charge per thousand words
This is not a business practice that is scalable to other cultures, in America we call that a bait and switch and it is considered unethical and shady, not only would it not sell it would draw a lot of bad press from the media.
Chinese parents care deeply about education
This is where I would say there competitive advantage is, they are heavily investing in their education system and actively encouraging investment in asset producing disciplines such as science and engineering. If they fix their sociopolitical issues they will be able to reap the full benefit of that investment, at which point we should all be concerned about their competitive advantage.
