Shanzhai Mobile Phone Research Articles

Window of the world: Transparency, digital placemaking, and Shenzhen Urbanism

Shenzhen, the first Special Economic Zone established in 1979 in southern China, has transformed from a global electronics manufacturing hub and counterfeiting capital into a UNESCO City of Design within the span of four decades. This article examines three digital-imaging practices that emanate from the city to explore the city's multiple connections to globalization from above and globalization from below. The first is the 2004 narrative film The World, directed by Jia Zhang-ke (often known as a Sixth-Generation Chinese auteur) and based in part on lead actress Zhao Tao's experience working in Shenzhen's Window of the World theme park. The second is Shenzhen-based company Transsion's design of smart phones for the African market, which have roots in the city's Shanzhai (i.e. “knockoff”) mobile phone sector. The third is large-scale light shows around the city in 2018–2019 that turn the facades of high-rises into electronic screens, featuring LED-light imageries generated by algorithms. Utilizing digital media to illuminate Shenzhen as a networked place in the world, these relational place-making practices simultaneously engage with and reveal the contradictions of transparency as a normative ideal upheld by global tech giants and Euro-American governments. Together, they provide a distinctive window to discern China's cultural and political dilemmas in the 21st century.

Exploring innovation in Shanzhai: the case of mobile phones

Chinese innovation in low-cost, ‘good enough’ electronic products has been very active. Such products may be copies of current branded goods that are positioned as straightforward counterfeits, knock-offs, or Shanzhai. In this paper, we argue that this simplistic analysis is inadequate to describe novel approaches to the production of new goods and that a new system of innovation is emerging. This novel innovation system has a distinct set of context specific actors and intra- and inter-firm structures that have aided the technology innovations and the development of new business models. This paper employs a case study method and uses qualitative data to explore how innovations emerge in new mobile technologies and the innovation system that supports their emergence. It examines the Shanzhai mobile phone industry as a case and provides a first attempt to map the innovation system that has developed. The results suggest that the distinctive characteristics of the Chinese innovation system contribute to the innovations around the product and the production processes. It further confirms the suitability of applying the innovation system approach to Shanzhai phenomenon, and explores new forms of innovation dynamics. The paper concludes with an initial agenda for further research in this area.

How latecomers innovate through technology modularization: Evidence from China’s Shanzhai industry

How local latecomer firms catch-up on technological innovation has been an important and well-researched topic. Inspired by the success of China’s Shanzhai mobile phone business, we propose a new path for latecomers to such strategic catch-up. Initially, technological development and profit seeking lead to technology modularization and value chain evolution. Specifically, some firms in possession of better technologies refocus their business on the design and production of chipsets and software, while others with other advantages such as market information reallocate their effort in cosmetic design, differentiation, or marketing. These local firms that used to be electronics suppliers to major original equipment manufacturers (OEMs) gradually transform themselves into module designers and producers, causing the value chain to evolve from a vertical and OEM-centric system to a horizontal, project-oriented and loosely cooperative network. Modularization and the evolution of value chain significantly lower the technological threshold of entering the mobile phone business, promote disruptive innovations, and accelerate latecomers’ accumulation of knowledge and technology.

Strategic transformation of Shanzhai firms: evidence from a Chinese case

The last several years have witnessed a huge growth of the Shanzhai mobile phone firms. However, in order to acquire long–term competitive advantages, Shanzhai mobile phone firms must make strategic transformations. This paper tries to explain the emergence and growth of Shanzhai mobile phone firms from theoretical views of modularity and disruptive innovation, and suggest that technological modularity facilitates the evolution of industrial value chain, which greatly lowers the threshold for local small firms' entry and promotes disruptive innovations. Shanzhai mobile phone firms start from low–end disruption, and by accumulating technology and market knowledge through resource integration, some of these firms can work their way up to eventually achieve independent innovation and their own brands, becoming major players in the market. Based on the case study of a Chinese firm, this paper explores the theoretical model of how Shanzhai mobile phone firms realise strategic transformation, and then discusses...

Institutional Entrepreneurship in the Creation of a New Market

This paper draws on the concept of institutional entrepreneurship to study the rise of China's Shan Zhai mobile phone market. Chinese shan zhai mobile phones have evolved over the last decade from ...

Renegades on the Frontier of Innovation: The Shanzhai Grassroots Communities of Shenzhen in China's Creative Economy

Two Australian researchers specializing in China's creative industries examine recent developments in southern China commonly associated with the shanzhai phenomenon (e.g., production and sale of cheap local facsimiles of globally branded goods). While shanzhai is often condemned as the embodiment of China's "knock-off" industries, the authors argue that it might be more appropriately viewed as an instance of China's emerging creative economy and an example of rapid prototyping. The paper traces the evolution of shanzhai mobile phones and the materialization of the shanzhai ethos in popular culture. In arguing that shanzhai provides inputs into creative industries, the paper describes the fuzzy boundary between formal and informal culture and notes the interaction between three spheres of activity: official culture, the market, and grassroots culture.

THE BUSINESS MODEL OF A SHANZHAI MOBILE PHONE FIRM IN CHINA

This study defines Shanzhai mobile phone (ShanzhaiGi) as an indigenous innovation product supported by a group of value chain suppliers that provide good-enough products by charging reasonable prices in a rapid time frame to fulfill the needs of target customers. Through examining the business model of Shanzhai mobile phone firms, we find that the value created by them is to provide products that benefit the countryside people so that everyone can get connected. Moreover, ShanzhaiGi offers more features than premium international brands to fulfill the market demand of the masses. Shanzhai mobile phone firms capture values, sales revenues, and market shares through cost control by utilizing Shanzhai’s value chain suppliers and innovative channel management. While contrasting the business model of Tianyu (as the ‘King of Shanzhai’) with other market leaders (Nokia and Samsung), we find that the market leaders have a relatively more developed business model than Tianyu. Therefore, Tianyu should further enhance its segment, value chain relationship, and competitive strategy.

Shanzhai manufacturing – an alternative innovation phenomenon in China

PurposeThe purpose of this paper is to explore an indigenous innovation phenomenon – entitled the Shanzhai phenomenon – which has emerged in the Chinese mobile phone industry, and to understand its value creation network and operational mechanism, as well as to recognize its policy implications in regional and industrial developments.Design/methodology/approachAlthough the Shanzhai phenomenon emerged from the end of 2008, detailed understanding of its systems and operational mechanism is still very limited, partly because of its secrecy and dynamics in the value chain operations. Based on characteristics of the Shaizhai phenomenon, the paper focuses on three levels of the phenomenon – regional historical, regional industrial specific, and typical Shanzhai mobile phone project levels – to pursue a comprehensive understanding of the Shanzhai system and its emerging environments. At the regional and industrial level, the combined approaches of interview and secondary data collection is adopted. At the Shanzhai project level, a case study approach is conducted by focusing on the project and its whole value chain, from the idea creation towards detailed product design, production and integration, as well as its distribution.FindingsChinese government has called for indigenous innovation to upgrade Chinese manufacturing capability and value creation as well as appropriation. Based on the fast growth of the Chinese indigenous mobile phone industry in the last two years, the Shanzhai manufacturing system is recognized as a new positive alternative way for Chinese manufacturing companies to achieve this aim. Behind the Shanzhai phenomenon, there is a strong globally specialized and collaborated network enabling the down‐stream Chinese small‐ and medium‐sized mobile phone companies to very quickly respond to customers' demands or lead the demands. This new type of alternative innovation system is transforming unaffordable luxury goods into affordable for normal consumers. Because of its mass volume and involvement, however, government policies to harness the energy and development direction become essential.Research limitations/implicationsThis research is just a very early stage of preliminary observation. From the methodology perspective, it provides background information about Shanzhai phenomenon and an in‐depth case study about a Shanzhai project. Comprehensive understandings of the Shanzhai phenomenon in terms of its behaviours, systems constructs and patterns, trajectories in the future and implications for policies will be achieved only at a much later date.Practical implicationsShanZhai manufacturing might be one possible alternative innovative paradigm in some sectors of China.Originality/valueThis is the first academic research paper to offer relatively comprehensive and systematic observations about the emerging ShanZhai manufacturing system in the largest developing country.