The driver pulled up to a small office complex in the heart of the city and beckoned us into the back of his scuffed white van. The surface of the vehicle was caked in dust and the seats, clad in new blue velvet, were sized for someone much smaller. I curled up in the back and we were off into the city, cars coming at all sides and bikes darting out in front of the unflappable driver, his smile never wavering as we drove. I was on my way to a factory outside of Shenzhen, a city of 14 million people mostly dedicated to the manufacture of the things we buy. If it beeps, makes phone calls, or increasingly, if you can wear it, it's probably come from out here. We roll through the city to the outskirts and then onto a wide five-lane highway that rolls up through the smog, past rocks and hills that look like a stage set for a Kung Fu fable. This is modern China, a place of conflicting images and a world of untrammeled growth.

We'll have a nice, old timey meet-up in Hong Kong this Friday, December 4 at 6pm at the California Bar 30 D'Aguilar Street Hong Kong. I've set up a Plancast event for us so watch that for any changes. If anything changes at the last minute, check my Twitter feed.

Greetings from sunny Shenzhen, just north of Hong Kong. I've spent some time in Asia - at least the tech centers - and have never found a place like this. It's like Blade Runner meets 1990s Prague meets the end of the world. I'm here to report on what's going on here in terms of electronics and how it's changing the way we think about price, cost, and value. It's pretty crazy. Thirty years ago Shenzhen was a rice paddy, a town of about 50,000 souls. Today it is a hive, and a dirty one at that. Smog is a way of life. As the sun goes down over the city, the streets take on an amber cast and the darkness falls quickly. There are no picaresque sunsets here.

BANGALORE, INDIA — It’s almost as if Russian cell phone carrier MTS has bought the naming rights to Bangalore. I half expected my immigration stamp to read “BANGALORE! ™ BROUGHT TO YOU BY MTS.” The carrier recently launched service in the uber-competitive Indian telecom market and has erected billboards every twenty feet or so. I have never seen so much advertising by one company in one space. They all sport an agro looking dude with his face twisted in some rebel-yell while he does inscrutable things with robots and mechanical arms holding different tech gadgets.

Why have these ads made such an impression on me? Because I’ve spent a week sitting in stopped Bangalore traffic looking at them. Ironically one keeps boasting: CONGESTION-FREE MOBILE NETWORK. Sitting still and listening to the honking of cars, mopeds, bikes and rickshaws all around me, it’s an easy guess that, if true, MTS could be the only thing congestion-free in India.

I used to think I knew bad traffic. After all, I moved to Silicon Valley during the famed Internet bubble when Highway 101 slowed to a crawl during peak commute hours. And I’ve spent time in legendarily congested US cities like Los Angeles and New York.

Now that India has one of the world’s best mobile infrastructures, it needs a decent road infrastructure. And a smart entrepreneur needs to come up with a modern fix. But before we talk solutions, let’s dwell more on the problem.

Simply put: All of you Americans—or Londoners for that matter—who Tweet about sitting in traffic have nothing to complain about compared to the emerging world. And in my experience, so far, India’s traffic is the absolute worst. A drive between cities that should take an hour takes four. A commute across a city can routinely take two hours-plus. We’re not talking about rush hour. I’ve quickly learned to allot at least three hours for each meeting—one hour for the meeting and one each for getting there and back.

Even so, despite my best efforts, I’ve been late for nearly every meeting. In Mumbai one meeting scheduled for late morning took six hours out of my day. (Fortunately, the meeting was well worth it.) And in Bangalore my cab driver tried to take a back-alley short cut, when suddenly, our path was blocked by a cow just munching on some roadside grass. He honked and honked and she just looked up and batted her pretty brown eyes at me as if to say, “Oh, you’re not making that meeting on time, hon.”

Indians complain about the poor foresight and urban planning of their government, but it’s not all the government’s fault. The Chinese government is the master of over-building capacity to anticipate growth, and city traffic in China is becoming unbearable as well. It’ll only get worse as an anticipated 30% more cars per year come on the road.

The problem is the hyper-charged urbanization these countries have experienced. In the West cities grew over centuries allowing city planners to adjust and modernize as industrialization drove higher occupancy. And in the past few decades there’s been a flight out of downtowns to suburbs. Of course that presents its own growing pains—especially in US cities that have experienced massive suburban sprawl like Phoenix and Atlanta. But in the grand scheme of things, the moves have been predictable and manageable, whether individual cities have handled it well or not.

Not so with the rapid urbanization of cities like Beijing, Shanghai, Shenzhen, Delhi, Bangalore and Mumbai. The step up in pay from hundreds to thousands of US dollars a year has been swift and far reaching. In China, agricultural classes have moved en masse to staff huge several-thousand-person factories, and for the Olympics, they moved en masse into hospitality jobs in Beijing’s raft of new hotels, malls and restaurants. This is to say nothing of the increase in government jobs and startups. There is simply no way to make remotely the same wage or have the same access to infrastructure and services outside a city. In some parts of India it’s been more pronounced as hundreds of thousands of sophisticated R&D jobs typically pay more than China’s factory jobs.

Here’s my point: All the existing Western solutions, endless government funds, underground subways and top urban planners will not solve this problem. Because simply put: The world has never seen urbanization so extreme by millions—maybe even billions— of people seeking a better life. We need some innovation here. And I know at least one guy who is thinking about it.

At a conference earlier this year, Elon Musk – the guy who co-founded PayPal, Tesla, SpaceX and laughs like a James Bond villain — talked about two new businesses he was mulling.  One was electric, supersonic planes, which I’ve salivated  over since. The other was pre-fabricated freeway overpasses to alleviate traffic by making it go vertical without the costly billion-dollar customized expansion fees.

I have to admit, at the time, I was more excited about the planes. But his freeway idea may be a better business. It would dramatically affect the lives of billions (literally) and create at least millions of revenues in the developing world where quick, cheap options are needed and there is hot-and-heavy government money to pay for it.

Now, clearly Mr. Musk is busy with existing ventures Tesla and SpaceX. So now’s your chance to steal the market out from under him! India and China are waiting.

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When Americans think of the Indian technology sector, they still perceive a nation of call center workers and low-level computer programmers administering databases and updating websites. But while the West was sleeping, Indian IT morphed into a giant R&D machine. Indian companies that started out doing call center and low-level IT work have climbed the value chain to become outsourced providers of critical R&D in sophisticated areas such as semiconductor design, aerospace, automotive, network equipment and medical devices.

This is happening as multi-nationals set up their own R&D operations in India and partner with local shops. Both the Palm Pre smart phone and the Amazon Kindle, two of the hottest consumer electronics devices on the market, have key components designed in India. Intel designed its six-core Xeon processor in India. IBM has over 100,000 employees in India. A large number of these are building Big Blue’s most sophisticated software products. Cisco is developing cutting edge networking technologies for futuristic “intelligent cities” in Bangalore. Adobe, Cadence, Oracle, Microsoft and most of the large software companies are developing mainstream products in India.

Equally important are the arrival of Indian multi-nationals who are tackling global markets, such as Tata with its dirt cheap Nano car that the company is now positioning for a European market entry and Reva, which recently announced it was planning to build an electric car factory in New York state to address the U.S. market for electric vehicles.

What has been missing to date in India, however, is early stage venture activity and the type of grass-roots entrepreneurism that is the hallmark of American capitalism and Silicon Valley. In that respect China is way ahead of India with many startups taking advantage of huge government incentives and reeling in talented native Chinese returnees to serve as CEOs and CTOs. Note that Kaifu Lee, formerly Google’s top guy in China, was able to launch a $100 million startup incubator focusing entirely on the mobile sector — and he was flooded with business plans within days of opening his doors in the Middle Kingdom.

On my recent trip to India I started to see new signs of life in tech entrepreneurship.  Many of the startups that Sarah Lacy and I met were really smart and hungry. Some were even doing things better than their Silicon Valley counterparts. Not all of these startups are developing breakthrough technologies but many of them are solving problems that U.S. companies have thus far failed to solve and doing it with fewer resources.

One of the most interesting companies I met is in the mundane business of developing offset printer ink. Their ink is made from vegetable oil and is entirely bio-degradable. The offset printing industry consumes 1 million tons of petroleum products and emits 500,000 tons of volatile organic compounds every year. An IIT-Delhi incubated startup called EnNatura developed a printing ink which emits no volatile compounds and is washable. And the overall cost of their solution will be significantly less than all present compounds when produced at scale. I can see a company like this growing into a billion dollar global business.

Another interesting company was LiveMedia. This is an out-of-home advertising company that has 4,500 screens in 2,200 destinations with a total reach of 50 million people. Of course, you can find exactly these sorts of TV screens in thousands of places across the U.S. Unfortunately, it has been very hard to make real money selling advertising on these networks. LiveMedia appears to have cracked that by creating specialized content that is more engaging and interactive than a box droning CNN or the Disney Channel. LiveMedia content includes games, quizzes, horoscopes, a few short animations, and other content that is both cheap to produce and easy to play along with or understand. LiveMedia has also perfected context-relevant advertising spots keyed to the crowds at the screen location.

LiveMedia is in the process of building out a partnership with Alcatel-Lucent Bell Labs India that would give the network even more interactive capabilities. Bell Labs has developed a content management and routing system, dubbed Mango, that makes it much easier and efficient to deliver high-bandwidth, high-quality video and interactive content over existing networks. In the developing world, everyone wants a TiVO-like capability to share, store and manage content. But existing GPRS or EDGE-based cell networks are not up to snuff. And the broadband infrastructure still lags behind that of the most developed telecom networks in places like Japan, Korea and Scandanavia.  A product like Mango is tailor-made for VC investment to get it out of the lab and into a spin-off company.

This is partly why so many U.S. venture capital shops have opened up branches in India. In fact, the two lead investors in LiveMedia are both U.S. venture capitalists including the respected Valley firm Draper Fisher Jurvetson. But India lags in home-grown venture capital activity. As I have previously discussed, VCs follow the innovation. So the lack of native VC in India is notable in that it implies a critical mass of activity remains lacking, as well.

For example, in the first nine months of 2008, total early stage VC investments in India totaled $678 million, according to the Global India Venture Capital Association. In the U.S. over that same period early stage investments tallied $5.2 billion according to the U.S. National Venture Capital Association – and that number is not entirely reflective of the real situation. The economic downturn hit the U.S. much harder than the Subcontinent and VC activity in the U.S. fell faster and harder. Regardless, a 10-fold difference between early stage venture activity clearly illustrates the capital is not there yet.

So when will there be enough innovative startups to support an explosion in venture capital? I’d argue, sooner than you realize. During my week in India I spoke to close to 100 startups. A few of them had products or prototypes that would easily compete in Silicon Valley. Some of the leading lights of the legacy Indian IT giants are also moving quickly into VC. Infosys founder Narayan Murthy recently sold millions of dollars of shares in the company in order to launch a venture capital fund targeting investments in India.

The dynamics of entrepreneurship are the same in India as in America. Company founders usually come from the ranks of experienced business executives and are middle-aged. They get tired of working for others and want to make an impact and build wealth before they get too old. Given that there are now hundreds of thousands of R&D workers in India who are gaining valuable experience and are getting old, it is simply a matter of time before they begin to hatch their entrepreneurial plans. After all, their colleagues who migrated to the U.S. now start nearly one in six of Silicon Valley’s tech firms.

I’ll bet that in 5 years, if you stacked up a TechCrunch 50 of Indian start ups versus a comparable number of U.S. startups, it would be a pretty even match. That’s pretty amazing considering the relatively short length of time that the Indian startup scene has existed. And it’s a good lesson for America that the barriers to starting a company are lower than ever before—and some ambitious engineer in India will eat your lunch if you don’t get your prototype built and perfected ASAP.

Editor’s note: Guest writer Vivek Wadhwa is an entrepreneur turned academic. He is a Visiting Scholar at UC-Berkeley, Senior Research Associate at Harvard Law School and Director of Research at the Center for Entrepreneurship and Research Commercialization at Duke University. Follow him on Twitter at @vwadhwa.

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China has for several years been heralded by western business leaders as ‘the place to be’. Yet despite the widespread excitement, the business successes of foreign companies operating and investing there have been limited, both in terms of quantity and in terms of magnitude. This week’s edition of The Economist, however, draws attention to the recent stellar performance of Israeli-Chinese venture firm Infinity in addressing the Chinese opportunity via its Infinity I-China fund.

The article focuses on the history of Infinity – the firm was founded by Amir Gal-Or in 1993 – and the reasons for which it has gained relatively unbridled access to the tightly controlled Chinese investment market. First, the firm has secured Chinese government entities as co-investors in its two China-focused funds. Second, and perhaps more importantly, the fund’s investments have included Chinese companies that focus on developing and deploying new technologies and intellectual property.

The second point is indicative of the Chinese government’s determination to move up the value chain and shift away from a focus on goods being ‘made in China’ towards a focus on goods being ‘invented in China’. As China’s economy develops, this shift to higher value added activities is no doubt a logical progression. But the (multi) trillion dollar question is whether China can nurture a culture of innovation and creative destruction which has proven fundamental success of the United States (through Silicon Valley) and Israel.

By developing new technologies and intellectual property, Israel has proven itself as an ‘intensive’ economic powerhouse – its greatest commercial achievements result from doing things in new and different ways, not from building companies that succeed through achieving economies of scale. On the contrary, China has mastered the science of manufacturing and has established itself as the world-leading ‘extensive’ economic powerhouse, but has to date fallen short on developing world-beating technologies. The relative strengths of the two nations suggest that there is potential for Israeli technologists and Chinese industrialists to exploit synergies in working together. And as Infinity has demonstrated, the Chinese government is amenable to supporting commercial arrangements which help build a foundation for future Chinese technological innovation.

The article rightly suggests that “managing transfers of technology and production across multiple countries and entities is horribly complex”. Yet there is a compelling opportunity for firms that focus on ironing out this complexity. By facilitating technology transfer and consequently helping China become a more technology and intellectual property-focused nation, Israeli companies will be better positioned to receive the Chinese government’s seal of approval. And further down the line, western firms may benefit as the Chinese government will have a vested interest in ensuring that local companies comply with western standards of intellectual property protection (assuming a considerable share of the global pool of intellectual property will at that time be Chinese-owned). One thing remains clear: western firms seeking success in China need to find the right partners. The case of Infinity suggests that for the time being the Chinese government may represent the best partner of all.

By Geoffrey Mugliston

BEIJING, CHINA– Give Yan Zhang (left) credit for honesty. You ask most expats about life in China and they talk up building bridges, mixing with the locals and their valuable expertise in building government contacts. When I asked Zhang about his expat life over breakfast he looked at me and said, “You do feel a little guilty about this life, because it can feel inauthentic.”

Inauthentic? Tell me more.

Twenty-nine year old Zhang, who has lived exactly half of his life in China, is a ringleader of a brat pack of smart, well-schooled Beijing expats working in everything from media to tech to education. I’ve twice run into him and a giant gang of friends in the Beijing nightlife scene. Said someone the last time, “Oh, everybody knows Yan.”

They genuinely work hard and most have studied in Asian history and Mandarin. What’s more these aren’t the expats of old with rich, corporate relocation packages. Most decided to move here first and figured out what they’d do second—even if many of them have family money that pays the bills in the meantime.

But many nights they also play hard—and usually just with other expats. (Ahem, see video here. That’s Zhang at the end.) They toss back drinks at Manhatten-esque nighclubs and British-style pub quizzes. I’m not judging. It sounds a lot like what I do with friends in San Francisco, truth be told. But I didn’t relocate to experience China either.

“Are we living the Chinese experience? Not really,” Zhang said. “But neither are expats who live just outside Beijing on a Hutong and also go out with other Americans at night.”

But unlike a lot of gadfly expats I’ve met in two trips to China, Zhang is building a real company. He’s been at it for two years. It’s actually aimed at the Chinese market, while a lot of expats just seek to leverage China’s workforce. And it’s not a U.S. copycat site. In fact, it’s a site that wouldn’t work in the US.

Zhang’s company is Meiloo.com, a site that helps Chinese Internet users find, source and compare doctors and hospitals for elective surgery. It’s not one of those Silicon Valley thank-God-the-URL-wasn’t-taken, nonsense word companies. It means “happy and beautiful.”

Elective health care services are a $10 billion a year market in China that already heavily advertises on TV, billboards and the Web. Elective medicine doesn’t just refer to things like plastic surgery here, but also to preventive care like annual physicals and dental check-ups. And unlike in the United States, where HMOs and private insurance companies own or control much of the market, in China’s growing, fragmented market finding a good doctor for a good price is, well, a lot like the challenges in comparing and sourcing travel in the pre-Web days, Zhang says.

Will the whole Chinese market jump to use Meiloo? No. But Zhang points out that Chinese travel site Ctrip taps less than 10% of the domestic travel market and is a multi-billion company. And Meiloo’s 15% cut of any service or surgery booked online can add up a lot faster. Plus, the demographics will increasingly work in Meiloo’s favor. The largest base of Chinese Internet users were born in the 1980s, and increasingly that audience is aging and will want – and be able to afford—dental work, plastic surgery, and laser eye surgery that government plans don’t cover. In fact, government health care doesn’t even cover annual physicals.

Meiloo is growing transactions at a pace of 15%-25% per month, and has helped book nearly $1 million US dollars in transactions in two years. Those numbers aren’t massive. But the biggest victory, according to Zhang, is that patients don’t use the system for research and then go around it to actually book services, and that doctors and hospitals actually pay Meiloo’s cut. 90% of Meiloo’s account receivables are resolved in sixty days. “We’ve worked to align everyone’s interest,” he says. “That’s the key to doing business in China.” So far there are 330 clinics on the system and 1,100 doctors listed. A lot, but a drop in the bucket by Chinese standards.

There’s two other things I like about Meiloo. One: Zhang’s co-founder Jeffrey Wu (right in the picture above) isn’t your typical smart engineer plucked out of a top Chinese school. He was a drop-out running a bar in Shanghai when he got recruited to Dangdang, one of China’s largest e-commerce companies. Within six years, he was the CTO. In my interview with Kai-Fu Lee earlier this week, he noted that all multinationals use universities as a hiring filter and admitted it’s not always the best or most fair way to find talent. Wu’s story proves it. I have a feeling that scrappy gray area is where many of China’s best entrepreneurs will come from in future years.

Two: So far, Wu and Zhang have bootstrapped the company with angel money from a friend. Zhang let it slip that he’s going to the Valley in early November. Given his anxious behavior as I asked more and more questions about the trip, I wouldn’t be surprised if a Valley funding round is on the horizon for the young company.

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SHENZHEN, CHINA– One of my very early posts for TechCrunch referenced the “futurism” of 1950s Americana, where companies like Monsanto and Disney played out dreamy visions of a new automated way of living that never quite came true. I’m writing this post from Shenzhen, in Southern China—a place whose jaw-droppingly impractical-yet-beautiful architecture and building-size LED-lit billboards make the city look like it could be the set for just that kind of dreamy science fiction megatropolis. (Example? The other night I had drinks outside the InterContinental’s bar, which is shaped like a huge pirate ship.)

So imagine my expectations when I set out to see BYD’s “Village of the Future.” BYD—for those who don’t know—is a Chinese powerhouse of battery innovation with more than 130,000 employees, roughly 10% of whom work in R&D. The company is a living, breathing reality check to Westerners who think Southern China is merely a hub for assembling the technology U.S. designs. My BYD guide told me that the company gets at least one member of Western media coming through the office a week, many of them shocked that a Chinese company could be so innovative.

In recent years, BYD’s founder Wang Chuan-Fu has leveraged an un-sexy expertise in lithium electronics batteries into an electric car business. And, now, the company is harnessing that same technology to make solar panels that can efficiently store solar energy and manage it. It’s impressive enough stuff that Warren Buffett paid $230 million for 10% of the company in 2008, spurring every major media organization to start taking BYD seriously. (According to a great article in Fortune, he wanted even more.)

But you want futurism? Go somewhere else. This house of tomorrow—totally powered by solar power and piped with recycled rain water—looks just like any suburban house in the world. (See picture above. Yep. That’s it.) Turn on the tap and it’s just like turning it on at home. The air conditioning sounds and feels like the AC in my hotel. The company uses the top of the concept house for executive meetings. The conference rooms only stand out in their unremarkableness.

And, while it may make for uninteresting photos, that’s what makes BYD so impressive, and part of what would attract someone like Buffett to break the same cardinal rules of investing that convinced him to avoid the late 1990s dot com mania: Stay away from what you don’t understand. When my guide was taking me through BYD’s “museum” of its products, she waved her had dismissively at a sexy electric convertible, saying the ho-hum practical sedan was the company’s best-seller. What sells in a country where millions are scrambling into the middle class is practicality, not sex appeal.

Similarly, BYD’s house of the future is steeped in practicality, not look-at-me tree hugging or science fiction. That’s something that could actually make a difference for the solar industry and for smoggy, energy-guzzling China.

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BEIJING, CHINA– Kai-Fu Lee may have left his post as president of Google China, but he didn’t go very far. While still president he learned that Google was going to give up some of its space at Beijing’s Tsinghua Science Park.

He called the landlord and told him he’d take as much as he’d give him. And now he’s in the next office, hoping a Chinese version of Larry or Sergey walks through his door.

As we reported a few weeks ago, Lee is also taking a few Google China staff members and indirectly some of that Google cash in the form of an investment from YouTube founder Steve Chen, among others.

His new venture is called Innovation Works, and it’s a sort of angel fund/incubator to help encourage Chinese entrepreneurs to eschew staid-but-prestigious corporate tech life and start a company instead. I met with Lee this week at his new digs in Beijing and so far, they’re pretty empty. There are a few analysts and engineers huddled by the door, near a table overflowing with different kinds of tea that people have given Lee as a good luck gesture in starting this new venture. (There’s so much tea, in fact, he insisted on my taking a tin.)

That elbow room won’t last: Lee got 7,000 resumes on his first day of business and has gotten some 40,000 total. It’s taking a while to plow through them, but he expects to hire at least 100 more people in the coming months. In fact, between our meeting Monday morning and sharing some Peking Duck later that night, he made four hires. (I shot a quick video with Lee talking more about Innovation Works. Unfortunately, my Flip has died for good, and it’s gone. So text will have to suffice.)

Lee is that rare unicorn-of-a-specimen that Silicon Valley companies and investors salivate over: He’s held key product and management roles at Apple, SGI, Microsoft and Google building a deep bench of respect and contacts in the inner circle of the U.S. tech business, but he’s also a hero to many young techies in China.

Want an example of the former? Back in the late 1990s, the product line he’d developed for SGI was struggling and being sold off to a company that would later be bought by Computer Associates. That ultimately meant Lee was looking for a new job. His father—a Taiwanese diplomat—had asked Lee on his deathbed to return to China one day, and a job with Microsoft was making that promise a reality.

Lee had decided to take it, but few people knew yet. He went home one day and his wife said, “Steve from Apple wants you to call.” Lee mentally paged through the Steves he’d worked for at Apple—never thinking of the obvious one. Lee had worked at Apple during the bleak years before CEO Steve Jobs returned to the company, or as Lee likes to say, “I was at Apple between Jobs.”

“I think it was Steve Jobs,” his wife said of the caller. Lee insisted it couldn’t be true, since he’d never even met him, but called the number back all the same. It was Jobs and he personally asked Lee to come back to Apple. Lee demurred.

“I know you’re going to work for Microsoft in China,” Jobs said. Lee was stunned. Almost no one knew. For a moment he must have thought his-iPhone-ness really was as all-powerful as the fanbois say. Then Jobs added, “Your wife told me.” When Lee asked why she divulged the closely-held secret she shrugged and said Jobs was so nice on the phone, she assumed he was one of Lee’s close friends.

Lee resisted Jobs, and you could argue missed out on the golden era of Apple as a result. But the Microsoft job meant that Lee was also an early multinational tech manager in China. Since then, between Microsoft and Google he’s given fat incomes and prestige to hundreds of Chinese entrepreneurs, building quite a following in China. (At dinner a young woman shyly came over and asked for his autograph.)

To be fair, Lee has his detractors in China too. Critics question whether the longtime corporate executive has the chops to pick and fund truly innovative ideas. After all, Lee himself said in our interview a few weeks ago that executives at multinationals typically don’t have the hunger to be great entrepreneurs. Others say he’s one of those bridge-builders between East and West that benefits by talking up business in China as being more complex than it really is.

After one meeting and one dinner, I can’t say whether either of those complaints are fair. But after spending several weeks in China in the last few months I will say this: If his well-cultivated reputation convinces more Chinese entrepreneurs to start businesses, that’s good for China and the tech world globally.

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An unknown number of Chinese schoolteachers, the Wall Street Journal reports, have been uninstalling web filtering software that the government ordered them to run in August.

Beyond the predictable cries of censorship, teachers told the Journal that installing the Green Dam Youth Escort software, punningly dubbed the Filtering Bully in Chinese, crashed their computers, made them unbootable, and blocked them from the student data applications on their own schools’ intranets.

The trouble began in June, when China’s Ministry of Industry and Information Technology made it mandatory for PC makers to include Green Dam on all new PCs sold there. The mandate only required PC makers to include the software, not to configure it to run. Nor were citizens ordered to run it themselves. (As you might guess, this freedom-of-information topic has an extensive Wikipedia page.)

Then, in August, the MIIT removed the requirement, but instead ordered all schools to install and use Green Dam. Reporter Loretta Chan says that’s when the real trouble began:

Researchers in and outside of China found that the software censored more than pornography, and actually blocked a wide range of content including Web sites about subjects including homosexuality and the spiritual group Falun Gong. They also said mass installation of the software in the world’s second largest PC market by units shipped would make computers vulnerable to cyber attacks.

One school claimed the program had a conflict with McAfee anti-virus software, also required by government regulations. One teacher said their PCs “died” while booting.

The Journal includes what journalists call a “to be sure” paragraph at the end. It says many teachers its reporters talked to had complied with the rule to use the software. But for readers who confuse China’s government with the one from Orwell’s 1984, take note: Teachers or administrators at several of the schools contacted by the Wall Street Journal about Green Dam Youth Escort had never heard of it.

[Photo: Zhang Chi]