This is how you lose a major tech company. First, a Beijing-backed buyout offer. Then friendly Chinese partnership proposals. Then the tech gets stolen. Then when you file a complaint in court, you get hit with investigations in China, your biggest market. nytimes.com/2018/06/22/tec…
The tech that Idaho-based Micron says was taken will likely end up in this factory. It was put up in just 2 years on farm fields in the Chinese city of Jinjiang. Funded by local governments, the same hearing the patent lawsuit filed against Micron. 
Because Taiwan has expertise in chips, Jinjiang added flights to Taiwan and is building an international school to court talent. The factory is also a stone’s throw away from the airport. The humble offices for this 2-year old company have 10,000 square meters of space.
This is the long and strong arm of Chinese industrial policy. It’s not just massive subsidies or regulatory pressure or ip theft, it’s all three working together with a massive market that can be weaponized to help domestic companies and slam foreign ones.
It has been going on for years, but the Micron example is evidence of a new push into memory chips, which are a part of an industrial policy initiative to jump to the cutting edge in priority industries, like semiconductors. A separate company likely took ip from Samsung.
The efforts sometimes seem ham-handed. For instance the engineer in this case raised suspicions because he Googled how to wipe his work computer. Later the Chinese company used Micron’s own code names in slides that were supposed to be about its internally developed products.
Still the ambitions are absolutely real. Here’s the new factory as the centerpiece in a model of a microchip development park. This will be the crown jewel in Jinjiang’s attempt to leave behind a poor past as a shoe manufacturer for a shimmering destiny as semiconductor hub.
While a lot of focus has been on the trade war and tariffs, the USTR report on China trade is filled with stories like this, and concern about rampant coercion and theft to acquire tech are driving US-China trade frictions.
The US and China don’t trust each other, and so increasingly don’t trust each other’s tech. As strategic competitors tech will also drive military and other strategic advantages in an emerging competition. Basically we’re at the beginning of a tech Cold War.
That means we’ll probably see more cases like this. China’s government is moving as aggressively as ever to get the ability to make its own tech. As the US pushes back, China is unlikely to give.
That means a more divided tech world. Already the Chinese Internet is mostly cut off from the world. It’s worth considering that the electronics supply chain may move more in that direction, even if at the moment it’s heavily embedded in China.
