China's change merchants: A new breed of CEO emerging in China is wiring the nation—and portending change for just about everything else - Technology

Chief Executive, The, March, 2002 by David Sheff

Tian nervously accepted the new job, essentially starting over. Though he began in a single room in Beijing's Friendship Hotel, these days CNC looks similar to a lot of U.S. startups. His fledgling team immediately began developing key strategies. The raiso [partial]etre: build a fiber-based broadband network. "Fiber is like a road upon which everything else will go forward," Tian says. Fifty days after the groundbreaking, the first 4,970 miles were installed. They went live in August 2001. That meant that in just 10 months, CNC built a network comparable to the ones that it took Qwest and Sprint two to three years to build in the United States. The results astounded skeptics. "People who were opposed to this project now see what one man with a vision can accomplish," says Peng Peng, China's assistant minister of railways. "It is waking up people throughout the Chinese government."

CNC's biggest worry going forward has nothing to do with competitors, even now with the country's January entry in the World Trade Organization. No, its biggest concern is a specter more daunting than any other: China itself. That the government has waffled so dramatically on its Internet policies over the years makes it a dangerous, chaotic force. "This is a horse race between encouraging information technologies and resisting them by people who want to control information," says Orville Schell, the dean of the Graduate School of Journalism at the University of California at Berkeley, and a longtime China observer. "No one knows which horse will win." CEO Tian is sanguine. "By now we are all working together with the same goal," he says. "We are building our nation so that the people of China will have opportunities they never had before and our nation will thrive. Imagine what limitless bandwidth can do for China. With our technology, enlightenment can flow through the taps like water. When it does, it wil l enlighten our whole country." And Tian's confidence may bear out. With the WTO entry, signs look promising for a more stable environment for CNC and other companies, too, particularly since the government's highest priority now is state-of-the-art technology and a world-class business environment.

Big shoes to fill

When Tian decided to leave AsiaInfo, his board wanted to undertake a CEO search, but Tian convinced them to look no further than his cofounder, James Ding. Ding, 35, who met Tian when they were both graduate students in America, was uninterested in the job. At first certain influential board members didn't try to persuade Ding to take the CEO post. Bill Janeway, senior managing director of the investment firm Warburg Pincus, who sat on the AsiaInfo board, said, "How could [Tian] do this to [his] partner? Abandon him and then saddle him with this thankless job!"

AsiaInfo had come far since it was founded in China in a warehouse-like office in Zhongguancun, where Ding and Tian bartered with the landlord. (In exchange for wiring the building, rent was free.) Their first major commission was a job for Sprint International, which had been hired by the government to build a dial-up-based commercial Internet in China. Sprint subcontracted the job to AsiaInfo. Ding, Tian and their team hired more engineers and built, with $4 million in imported computers and routers, the first phase of a commercial Internet in China, a link between Shanghai and Beijing. They connected both cities to the international Net via leased undersea telephone cables. In 1995, the government prepared to extend the contract with Sprint for the next phase of the project, the wiring of additional Chinese cities to the network it named ChinaNET. By then, Sprint no longer wanted a subcontractor and it planned to cut AsiaInfo out of the deal. AsiaInfo fought back. It went after-and won-the government cont ract.