Shanzhai translates literally as ‘mountain fortress’ – the name for a remote stronghold used by bandits to stockpile contraband and ill-gotten gains.
Over time its usage has evolved. Retaining its connotation of illegality and abundance, the meaning moved on to cover the millions of counterfeit products that have flowed from China’s factories. Shanzhai came to be understood as ‘fake’ or ‘imitation’.
According to David Li, founder of Shanghai think-tank Hacked Matter, this incarnation of shanzhai developed in the early 2000s, when copycat phones started to mimic less affordable models from Nokia, Samsung and Sony Ericsson.
Whilst the imitation phones started out by trying to recreate the qualities of the originals, it wasn’t long before the shanzhai manufacturers began to add small extras to their designs for a competitive edge. These shanzhai models evolved from copycat products into more innovative items, appealing to niche markets – such as handsets with greater sound volume for construction site workers or phones with multiple sim card ports (useful in China where sim cards have provincial rather than national designations).
Soon shanzhai was ceasing to simply mean ‘counterfeit’ and progressed to a newer meaning implying innovation.
Perhaps it’s odd that this new model of expansive thinking was represented by a word including the character (寨) for a defensive stockade (the first pictogram in shanzhai – for mountain – is denoted by 山). But this “new shanzhai”, as Li puts it, is an innovation ‘ecosystem’ that thrives on open source technology and shared information. Software and hardware is available to copy and alter (a would-be manufacturer can pick the variants it likes and then have a factory compile them into a finished product). Moreover, participants in this ecosystem share their information and experiences, triggering further innovation by eliminating the need for everyone to go through the same trials and errors.
Li describes the new shanzhai as an embodiment of ‘democratic innovation’ – and as innovation “without the barrier of intellectual property rights”.
Of course, for developers outside of the ecosystem, this “barrier” is supposed to protect them rather than exclude them. A common criticism of shanzhai production is that it fails to respect trademarks and patents. One recent example was the manufacture of hoverboards (a mobility device somewhat like a Segway, but without the lectern) in Shenzhen. A flood of factories have been producing variations of the hoverboard, much to the chagrin of the American inventor who claims to hold the original patent for the device. He is furious – the open source ecosystem to which he has been unwillingly exposed denies him the chance to turn a profit on his invention.
Besides copyright infringement, there are other shortcomings for shanzhai which can be equally serious. For instance, the more limited regulation inherent in the shanzhai style allows less reputable manufacturers to use poorer quality materials and shelters them from the repercussions if their products fail.
Some hoverboards have combusted or exploded, on several occasions resulting in house fires. A number of airlines won’t carry them in stowage on safety grounds.
That isn’t to say that all shanzhai products are sub-standard. In fact, what keeps shanzhai alive is that many of its products reach a par with international standards.
In other cases, shanzhai startups have transformed themselves into fully-fledged businesses.
Xiaomi, the world’s fifth largest smartphone maker, is held up as an example of successful shanzhai by China Daily. It started out with smartphones that looked pretty similar to iPhones and which ran on an altered version of the Android operating system. Now it is building its own technology and its own brands.
For more on the world of shanzhai production in Shenzhen, see our Focus issue on the Pearl River Delta.
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