Welcome!

News Feed Item

Repositioning Beijing: A Tale of Two Cities

New York and New Jersey, San Francisco and Oakland – just some of the cities that have sprung up alongside one another all over the world, with one often fulfilling functions that the other cannot.

The most obvious such example in China is perhaps Shenzhen, which rapidly grew into a sprawling agglomeration of 7 million people to serve as a manufacturing and services hub for nearby Hong Kong.

Now something similar might be about to happen further north. In late February 2014, China’s President Xi Jinping said it was time for a new approach to “positioning Beijing”.

Although Beijing is attractive because it is the capital, Mr. Xi said some of its functions would be better off located in nearby Tianjin, a much less expensive city with a slightly smaller population that can be reached in about half an hour by high-speed train.

Mr. Xi said Beijing, Tianjin and Hebei Province – which together have a total population of 100 million people – should be considered as one big cluster for planning purposes instead of silo-ed against each other. The Chinese leader added that a shared regional culture and social norms as well as family ties would support such integration.

“China's regions are enormous markets in and of themselves. Tastes and regulatory environments vary significantly between different regions, making it important to recognise their specific characteristics,” said Duncan Innes-Ker, China economist at the Economist Intelligence Unit. “History has also resulted in very different economic profiles among regions. Building on these characteristics has been key to successfully developing local comparative advantages.”

Tianjin is already doing its best to serve as an alternative to Beijing. Its Yujiapu district is aiming to become a headquarters hub for China’s national-level State Owned Enterprises, while the Tianjin Economic-Technological Development Area (TEDA), which is consistently ranked as China’s top development zone since two decades ago, is bent on hi-tech innovation as well.

That means investment in facilities for hi-tech companies that may not be available in the capital.

China’s version of Silicon Valley, dubbed ‘Silicon Hutong’ is located in Beijing’s Zhongguancun district, near the country’s elite universities.

But it’s not an easy place to be for startup firms, many of which must grow without significant outside investment and find a way to cover their costs. Beijing rents alone are as much as three times higher than in Tianjin.

“Many high-tech companies come [to TEDA] from Beijing, and Beijing and Tianjin form a mega-city,” said Zou Fang, Deputy Director of TEDA’s Investment Promotion Bureau.

“The technology achievements and capital mostly come from Beijing. But Tianjin has something special to offer to complement Beijing – that is low costs, development space, government support, and a service mechanism. Many Beijing firms are start-ups that need such a growth environment.”

To this end, TEDA has developed the Tianjin-Beijing Interconnected Entrepreneurship Promotion Center, with Zhongguancun as a key collaborator. It was visited by Chinese Premier Li Keqiang last December.

Such inter-regional initiatives are moving China into the same league as the US when it comes to supporting entrepreneurs. “Innovation is not a zero-sum activity. Different regions have different strengths, not just domestically, but internationally,” said Dr. Olaf J. Groth, Managing Director of advisory firm Emergent Frontiers Group LLC; Professor of Global Innovation, Strategy, Organization & Economics at HULT International Business School; Co-author of the “The Bay Area Innovation System – How the Bay Area Became the World’s Leading Innovation Hub and What Will Be Necessary to Secure Its Future” published by the Bay Area Council Economic Institute.

“In the US, much of the cleantech innovation originates in California, but is highly dependent on partners in other regions, such as the mid-west and south-east of the US, Germany, France, Japan or Korea, where many automobile manufacturers are located,” said Groth. “As more and more domains converge, it makes no sense to tether a venture to one certain location, but rather to let it source its inputs and even to move where it is best supported in a given stage of its growth.”

As a part of the support program to high-tech start-ups, TEDA administrator also purchases products and services from the big Chinese IT service provider Teamsun, such as cloud services, server capacity and technical training, which are then given to tenants free-of-charge.

Although this accounts for just 6 to 7 percent of Teamsun's overall operation, General Manager of Teamsun Zhou Peiyong said it has become strategically important to their business, as down the line the firms that benefit often approach Teamsun directly and become clients.

“We have found that this cooperation pattern has secured its own viable business model, which is win-win for all: to the tenants, to our company as a service provider, and to the whole region,” said Zhou. “In fact, TEDA is the first industrial park ever to have piloted this model in China. And now Zhongguancun is following suit,” he added.

TEDA also offers a wealth of financing options for growing companies. Its status as a development area means there is less red tape to wade through and it is now home to China’s first wholly foreign-invested venture capital firm and China’s first industry-focused private equity firm. There are also nine microfinance firms, creating a robust growth-environment for SMEs.

In late February, TEDA announced the creation of an Internet-based financial services cluster, further working on the convergence among the region’s top-notch IT industry and financial innovation.

“Tianjin has a very solid bricks-and-mortar industry base, including the port economy and trade, etc. That is extremely important critical mass for internet business to thrive because after all the click is there to serve the brick,” said Luo Mingxiong, executive director of China’s Internet Finance Lab and vice-president of Beijing Software & Information Services Exchange.

Luo said more than two-thirds of commercial factoring firm licenses and more than half of financial leasing firm licenses in China are held in Tianjin.

“Tianjin and TEDA have done great work in piloting innovation in the financial service sector. All this is encouraging Tianjin-based enterprises to embrace the innovation economy and create a unique economic landscape.

“On top of this, it’s inevitable that many Beijing-based companies will relocate, driven by factors such as high housing-cost. This is a great opportunity for Tianjin and so it’s imperative that the city works hard to synchronize its planning and overall vision with Beijing,” said Luo.

While Beijing and Tianjin share a cultural identity, some observers argue that different perspectives are also invaluable for stimulating new ideas.

“One of the exceptional attributes that China and the US share is heterogeneity and diversity,” said Sara Sandford, an attorney with the law firm Garvey Schubert Barer.

“The related diversity of perspectives and ideas have often been touted as the foundation of innovation in the US. China has the same unique opportunity to use heterogeneity to the benefit of its efforts to innovate and develop new technology and business...[For regional collaboration to work,] they also need to create an infrastructure that allows for greater sharing of ideas,” she added.

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
With the introduction of IoT and Smart Living in every aspect of our lives, one question has become relevant: What are the security implications? To answer this, first we have to look and explore the security models of the technologies that IoT is founded upon. In his session at @ThingsExpo, Nevi Kaja, a Research Engineer at Ford Motor Company, will discuss some of the security challenges of the IoT infrastructure and relate how these aspects impact Smart Living. The material will be delivered i...
As software becomes more and more complex, we, as software developers, have been splitting up our code into smaller and smaller components. This is also true for the environment in which we run our code: going from bare metal, to VMs to the modern-day Cloud Native world of containers, schedulers and micro services. While we have figured out how to run containerized applications in the cloud using schedulers, we've yet to come up with a good solution to bridge the gap between getting your contain...
Apache Hadoop is emerging as a distributed platform for handling large and fast incoming streams of data. Predictive maintenance, supply chain optimization, and Internet-of-Things analysis are examples where Hadoop provides the scalable storage, processing, and analytics platform to gain meaningful insights from granular data that is typically only valuable from a large-scale, aggregate view. One architecture useful for capturing and analyzing streaming data is the Lambda Architecture, represent...
As organizations realize the scope of the Internet of Things, gaining key insights from Big Data, through the use of advanced analytics, becomes crucial. However, IoT also creates the need for petabyte scale storage of data from millions of devices. A new type of Storage is required which seamlessly integrates robust data analytics with massive scale. These storage systems will act as “smart systems” provide in-place analytics that speed discovery and enable businesses to quickly derive meaningf...
Your homes and cars can be automated and self-serviced. Why can't your storage? From simply asking questions to analyze and troubleshoot your infrastructure, to provisioning storage with snapshots, recovery and replication, your wildest sci-fi dream has come true. In his session at @DevOpsSummit at 20th Cloud Expo, Dan Florea, Director of Product Management at Tintri, will provide a ChatOps demo where you can talk to your storage and manage it from anywhere, through Slack and similar services ...
SYS-CON Events announced today that Ocean9will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Ocean9 provides cloud services for Backup, Disaster Recovery (DRaaS) and instant Innovation, and redefines enterprise infrastructure with its cloud native subscription offerings for mission critical SAP workloads.
Building a cross-cloud operational model can be a daunting task. Per-cloud silos are not the answer, but neither is a fully generic abstraction plane that strips out capabilities unique to a particular provider. In his session at 20th Cloud Expo, Chris Wolf, VP & Chief Technology Officer, Global Field & Industry at VMware, will discuss how successful organizations approach cloud operations and management, with insights into where operations should be centralized and when it’s best to decentraliz...
The taxi industry never saw Uber coming. Startups are a threat to incumbents like never before, and a major enabler for startups is that they are instantly “cloud ready.” If innovation moves at the pace of IT, then your company is in trouble. Why? Because your data center will not keep up with frenetic pace AWS, Microsoft and Google are rolling out new capabilities In his session at 20th Cloud Expo, Don Browning, VP of Cloud Architecture at Turner, will posit that disruption is inevitable for c...
Providing the needed data for application development and testing is a huge headache for most organizations. The problems are often the same across companies - speed, quality, cost, and control. Provisioning data can take days or weeks, every time a refresh is required. Using dummy data leads to quality problems. Creating physical copies of large data sets and sending them to distributed teams of developers eats up expensive storage and bandwidth resources. And, all of these copies proliferating...
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm. In his Day 3 Keynote at 20th Cloud Expo, Chris Brown, a Solutions Marketing Manager at Nutanix, will explore t...
DevOps has often been described in terms of CAMS: Culture, Automation, Measuring, Sharing. While we’ve seen a lot of focus on the “A” and even on the “M”, there are very few examples of why the “C" is equally important in the DevOps equation. In her session at @DevOps Summit, Lori MacVittie, of F5 Networks, explored HTTP/1 and HTTP/2 along with Microservices to illustrate why a collaborative culture between Dev, Ops, and the Network is critical to ensuring success.
Interoute has announced the integration of its Global Cloud Infrastructure platform with Rancher Labs’ container management platform, Rancher. This approach enables enterprises to accelerate their digital transformation and infrastructure investments. Matthew Finnie, Interoute CTO commented “Enterprises developing and building apps in the cloud and those on a path to Digital Transformation need Digital ICT Infrastructure that allows them to build, test and deploy faster than ever before. The int...
SYS-CON Events announced today that SoftLayer, an IBM Company, has been named “Gold Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York, New York. SoftLayer, an IBM Company, provides cloud infrastructure as a service from a growing number of data centers and network points of presence around the world. SoftLayer’s customers range from Web startups to global enterprises.
SYS-CON Events announced today that Conference Guru has been named “Media Sponsor” of SYS-CON's 20th International Cloud Expo, which will take place on June 6–8, 2017, at the Javits Center in New York City, NY. A valuable conference experience generates new contacts, sales leads, potential strategic partners and potential investors; helps gather competitive intelligence and even provides inspiration for new products and services. Conference Guru works with conference organizers to pass great dea...
SYS-CON Events announced today that Technologic Systems Inc., an embedded systems solutions company, will exhibit at SYS-CON's @ThingsExpo, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Technologic Systems is an embedded systems company with headquarters in Fountain Hills, Arizona. They have been in business for 32 years, helping more than 8,000 OEM customers and building over a hundred COTS products that have never been discontinued. Technologic Systems’ pr...