The West must devise cyber technology that is both serviceable and simple or allow China to dominate
 The increasingly hostile policy towards China shared by the fractious right and left of American politics, now being tentatively joined by European sentiment, has strengthened an otherwise weakened and weakening Western world.
An example of where this hostility to can lead, weakens rather than strength is shown in the recent fear of Chinese drone sales in the US in which a single company, Shenzhen-based SZ DJI Technology Co, controls more than 50 per cent of the US domestic market.
The Americans, and undoubtedly the Europeans too, are fearful that these drones are transmitting data they collect to a People's Liberation Army database to be collated into a thoroughgoing map of every square inch of wherever they are sold. This has prompted the same fears that Edward Snowden raised from his admittedly scary National Security Agency domestic surveillance activities.
Forgetting the merits of these fears, for the moment, there is another problem created by the fusspot west. That is its mania for health and safety regulations. Because of their crippling impact on innovation, the Chinese not nearly so constrained, are out producing the West in cutting edge technology. And no more so than in the area of drones, aka, unmanned aerial vehicles or UAVs.
These are drones primarily for civilian use. The Chinese have no trouble testing them doing whatever they choose. When accidents happen, they make no fuss, but take them in stride.
No so worry-wart Americans and Europeans, There such tests are blocked and so tightly regulated by the health and safety bureaucracies that few if anyone thought to endure such meddlings unless they were sure there would be a pot of gold at the end of the rainbow.
The prospect of facing obstacles dissuades innovators or investors who might be inclined towards innovative investment. The military, being more accepting of deadly risk, escapes this regulatory control, and is free to do what it wants - and thus welcomes innovators who freely innovate on their behalf. But this leaves the vast civilian market unattended and unexploited.
The result has been that China has made drones to be marketed to the civilian world as part of its Belt and Road Initiative relegating the US and Europe to being a rich much secondary market - cutting features from their products to suit regulatory tastes.
In the current cooling diplomatic climate, China is far ahead in civilian drone making and ready to take on the West with top notch products.
This has induced America to challenge foreign democracies with something akin to loyalty oaths - "Who's side are you on, anyway!?" The US, with Europe not far behind, discourages ASEAN members from buying cheaper and better Chinese drones.
The result, said Paul Triolo, a former US government official who specialises in global technology policy at risk consultancy Eurasia Group., is likely to cause a complete bifurcation of the internet, reflecting the values of competing political systems.
“The democratic and authoritarian digital worlds will be built on largely different hardware, with different standards, and limited points of connection,” Mr. Triolo said, depicting a game changer that goes far beyond the drone world.
“This will drive up costs for businesses operating across these two spheres, reduce innovation, and lead to geopolitical tensions, reduced trade, and a much more complex world for companies to operate within. Other countries will be forced to choose sides in this divide, and this will be painful and costly," he said.
The US has reacted in the usual way. Instead, of fewer regulations, the bureaucracy advocates more. Brendan Carr, one of four Federal Communication Commission (FCC) commissioners, said that the regulatory body should consider a ban on approvals of DJI’s equipment, citing the “vast amounts of sensitive data” collected by its drones.
In an FCC statement, Mr. Carr warned DJI may be a “Huawei on Wings,” referring to the Chinese telecommunications giant the US has sought to hobble with sanctions over spying concerns. When contacted by Bloomberg, FCC chairwoman Jessica Rosenworcel declined to comment on Mr. Carr’s call for restrictions on DJI.
Governments should assume that Chinese spy agencies will find value in information gathered by DJI’s drones, according to Andrew Shelley, director of Aviation Safety Management Systems, an advisory company based on the North Island of New Zealand that works with government clients.
“For the average recreational user who might be taking selfies on the beach, it’s probably true that DJI is not interested in their data,” he said. “But collectively, the Chinese government is interested in our data. We don’t understand just how much of a threat that is.”
Last year, Shenzhen's DJI started a new education division, offering a small drone priced at just US$240 as well as software to help schoolteachers instruct young students on basic coding. In October, the company enlisted cinematographers - including three Oscar winners - to promote a drone with new stabilisation technology and a range of other advanced features. Other devices include one that can stay in the air for as long as 46 minutes and another for cropdusting that “can cover 40 acres in an hour.”
Rivals are impressed. Salt Lake City-based Teal Drones founder George Matus said: “They’re totally killer at what they do. It was super-hard competing against DJI: It became a race to the bottom on price and they just totally obliterated most of the market.”
Mr. Matus said state subsidies saved the day and “allowed companies like Teal to survive and thrive. American companies have some room to grow.”
DJI, he said, has “a huge workforce of engineers that makes sure every piece of hardware on their drones is perfect.”
At the same time, Mr. Matus appreciates US actions against DJI. A Teal drone was among five approved by the Pentagon for military and federal use, and the company is now seeking to double its some 20-man workforce and ramp up production capacity, he said.
Most of DJI’s American rivals are smaller companies like Teal after larger competitors like GoPro and 3D Robotics exited the market. The Pentagon’s Defence Innovation Unit has announced a new round of 11 approved vendors for UAVs, most of them American and two from Switzerland.
The lack of similar alternatives to DJI is a concern for local police departments that receive some funding from Washington and could be hindered by rules banning federal spending on DJI equipment, said Luke Goldberg, president of Chatsworth, California-based Enterprise UAS, owner of several drone distributors. Most American-made commercial drones, he said, could cost as much as 30 per cent more and offer fewer features.
Drone Industry Insights CEO Kay Wackwitz said the US attacks on DJI are more about protecting the country’s ability to make drones than fears about data.
Worries about DJI drones transmitting images of air bases or power plants to Chinese intelligence are unrealistic, said Mr. Wackwitz, whose consulting firm is based in Hamburg. “The amount of data is way too big, so where is the actual harm?” he said. “To me, it appears to be a reason to push the Chinese manufacturers out of the market.”
First, that may not be so. China's vast populations has annual bumper crops of IT and STEM field graduates pouring out of third level educational institutions large and small. Wuhan alone has more than 70 universities and colleges. And that is one city among many from Chongquin to Hainan, from Harbin to Chengdu. So they have literally armies of bright young things ready and willing and able to sort out the data from every valley girl's cell phone.
But more important than that, is the risk of bifurcation of the digital world simply because West cannot bring itself to ditch the health and safety mania which cripples innovation. After innovators slalom through the objections of regulators, they at last come up with an acceptable device that only Americans and Europeans can afford. Where's the profit in that? Why bother?
The story of the Sten gun comes to mind. In World War II, after the British lost most of their weapons at the Dunkirk disaster and needed new submachineguns. The Americans had a Tommy gun for US$200 apiece. This was too expensive for the British so they devised a crude pressed metal Sten gun for $13 apiece. Now is the time the West best look to creating vast numbers of technological Sten guns for the coming fight for a fair share of cyberspace. |
