Google vs. Microsoft in China
The usual suspects in the media are having a field day with the story about Google poaching an MSFT executive to run their Beijing office. Unfortunately, all of the reporting I’ve seen is rather lazy and sensationalist. My first instinct was, “why no such reporting when Li Gong left Sun to head up Beijing operations for Microsoft?” That was much more relevant to our position in China, IMO. I suppose the tech press have room for only one “clash of titans” story at a time, and now that McNeally and Ballmer are golfing together, it just doesn’t play.
Overall, I think the reporting misses the context when it portrays the news as a blow to our China R&D efforts.
First, China has no shortage of engineers, and companies have limits on how fast we can hire and integrate new employees. Even if both we and Google double the size of our China R&D operations every year for the next 5 years, we would still not be in a position where we would be competing with one anotherfor the top 1% of entry-level engineers. The bottleneck is not talent; the bottleneck is hiring.
Next, graduates of the very best schools in China (think IIT in India) have a high opinion of Microsoft. Even if we were in direct competition with Google (rather than IBM) for the top hires, we would do well.
Finally, when you start hiring the more senior people, and actually driving the business, local relationships matter more than in the U.S. Once the China operations are more established with the brightest devs, testers, and PMs, you will want to grow the middle and senior management capabilities so that the subsidiary can operate more independently. Li Gong is from Beijing. Dr. Lee is from Taiwan. It shouldn’t matter, but it does. Microsoft has a well-established China R&D, Google doesn’t.
In short, I don’t see any reason to expect that Google China R&D will be in the same league as MSFT anytime soon. This isn’t a story about Microsoft vs. Google in China. The story is just a boring story about non-compete for an executive with valuable insider information.