China Entrepreneur Network Forum 2011

China Markets for Sustainable Technologies

Exploring Effective International Collaboration in Technology Commercialization

By Jay Wrolstad

Marketing cutting-edge products and services designed to endure and to protect the environment presents many challenges, including controlling costs, protecting intellectual property, and establishing a broad base of consumers.

Such hurdles were among the subjects examined in a discussion of Chinese markets for sustainable technologies and effective U.S.-China collaboration in technology commercialization that included attorney Joanne Hsiao, Shangdong University Associate Dean Hongwei Liu, and Environmental Waste International CEO Stephen Simms.

"Intellectual property protections are critical as more wealth is created through technology," said Hsiao, a specialist in contracts and international law. But registering proprietary technology becomes complicated when a company must choose a jurisdiction, either national or international, and take into account where activities such as research and development and marketing take place.

Also, said Hsiao, companies must comply with intellectual property rules and regulations, and consider treaties that support their business model. "Intellectual property is a western concept; it is new to China," she said. "Change is coming rapidly as manufacturers develop more of their own products, but you can’t assume that they do business the same way it is done in the U.S."

Simms explained that his company has learned this lesson in bringing to China a proprietary tire recycling process that turns rubber from a solid to a gas by breaking down the basic carbon molecules in a closed system, eliminating the environmental hazards associated with shredding or burning tires.

In commercializing this clean technology in China, Simms said, his company has learned that maintaining patents in several countries is costly, and that obtaining international patents is a time-consuming process that delays bringing new technologies to market. "The bigger issue in China is a lack of infrastructure, which hinders commercialization," he said. "But as the infrastructure improves, the cost of doing business in China will rise."

Liu suggested that inflation, caused primarily by higher labor and energy costs, is the primary challenge for businesses, both foreign and domestic, bringing new technologies to market in China. "Labor costs in China are still lower than in the U.S., but the cost of resources is as high, or higher," he said. And, he noted, the rollout of next-generation, sustainable technologies in his country is hampered by an imbalance in development, with rural areas growing at a slower pace than large urban centers.