Cold War II : How US-China Rivalry Leads To A Polarized Tech World Order
Way back in 2005, I predicted a Cold War between US and China that would divide the global tech sector in two rival blocs: US-led vs. China-led.
Huawei’s recent decision to break free from Google Android and launch HarmonyOS NEXT is just the beginning of Cold War II between China & US, both vying for global tech hegemony.
In November 2005, as a Forrester analyst, I published a report titled “How India, China Redefine The Tech World Order”
Here is summary of this report:
India and China — with their fast-growing markets and rapidly-expanding innovation capabilities — are threatening to redefine the historical US-centric — and unipolar — world order for the tech industry.
But instead of throwing up barriers and viewing India and China as competitive threats, US tech vendors are building global high-tech Innovation Networks: multipolar ecosystems that exploit the huge markets and the growing talent pools in India and China.
This report examines how the epoch-defining interplay of accelerators and decelerators impacts the performance of both Asian giants and will shape high-tech industry relationships between the East and the West over the next two decades (2005–2025).
Through three scenarios, India remains a strong US ally, leaving China to be the wildcard in defining a new tech world order.
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In that 2005 report, I proposed 3 possible scenarios for the tech word order by 2025:
SCENARIO 1: CHINESE MIRAGE
The shaky economic fundamentals fail to sustain China’s astounding growth and ultimately lead to China’s collapse
As a result, the domestic tech market in China is stifled. The purchasing power of the tech-savvy Chinese middle class vaporizes as millions find themselves unemployed
Western vendors start pulling out of the anemic Chinese market, crippling the export-dependent Chinese high-tech manufacturing sector
US, Japan, Korea, India battle for leadership in new tech markets
SCENARIO 2: COLD WAR II
Deteriorating Chinese-American geopolitical relationships lead to polarization and rivalry
Chinese firms break free from their dependance on US tech and develop their own hardware and software
Conservative US politicians depict China as the new USSR that needs to be “contained”
SCENARIO 3: PAX INDO-CHINA
Rather than compete, Indian and Chinese tech vendors establish a strategic science and technology alliance between their countries
By tapping each other’s specialized invention and innovation capabilities, India and China Innovation Networks become the high-tech version of the Silk Road, the collaborative trading network that initially linked up Indian and Chinese firms nearly 2,000 years ago
As I write this, 20 years since I published the above report, the COLD WAR II scenario (between US and China) is no longer a possibility but the new reality.
If I had posted this article while I was living in Silicon Valley, my Wi-Fi router would be Cisco-branded.
But today, I am in India, and the WiFi router I use is made by … Xiaomi.
