Tech giants start by disassembling systems

Chapter 112 Xingyao's Sincerity

This signifies that Hongyuan has truly entered the realm of low-altitude communication.

From acquiring Hantong Microelectronics and obtaining LDCL authorization to announcing the Feiniao 2.0 Technology Open Day and H-Link launch event, Su Chen completed the transformation from passive to proactive in less than two weeks.

"This guy is going to shake up the whole industry again."

Xia Kanghao sat in Haotai Capital's office, staring at the press conference announcement on the screen, his face filled with complex emotions.

To be honest, ever since Haotai acquired Tianying Technology, Xia Kanghao has been trying to integrate Tianying's remaining business into Haotai's industrial portfolio. But reality is much harsher than he imagined—Hongyuan's Feiniao platform has almost siphoned off all new customers in the agricultural drone market, and Tianying's existing users are also being lost at a rate of three to five percent per month.

At this time, Hongyuan is about to release a communication solution. If H-Link is really an open protocol as Su Chen boasted, then Tianying's remaining market share will probably be reduced to nothing.

"If I had known, I shouldn't have acquired that mess from Lu Weimin in the first place."

Xia Kanghao rubbed his temples, his heart filled with regret.

……

Three days before the press conference, on July 15, 2020.

Su Chen received an unexpected guest in his office at the Longhua headquarters.

Han Shijie, Chairman of Xingyao Technology.

Xingyao Technology is one of the largest industrial-grade communication module OEMs in China, headquartered in Suzhou, with annual revenue exceeding 1.2 billion yuan. It primarily provides customized wireless communication module OEM services to major communication equipment manufacturers and IoT companies. In the drone industry, Xingyao is also a significant supplier—communication modules for several drone companies, including Hongyuan, are produced on Xingyao's production lines.

Han Shijie, 47 years old this year, started from scratch and built a communication module OEM giant with a scale of over one billion yuan from a small surface mount technology (SMT) factory. He is known in the industry for his shrewdness and pragmatism, and never does business at a loss.

But at this moment, Han Shijie was sitting opposite Su Chen with an unusual humility on his face.

"President Su, it's a pleasure to finally meet you formally."

Han Shijie took the initiative to extend his hand.

"Mr. Han, you're too kind."

Su Chen shook hands with him, somewhat surprised. Although Xingyao Technology was one of Hongyuan's communication module OEM suppliers, their previous contacts had all been at the procurement and supply chain level, and Han Shijie had never personally visited them.

With the press conference imminent, Han Shijie suddenly flew to Shenzhen to see him, clearly not just for pleasantries.

"President Su, to be honest, I've come here today with a favor to ask."

really.

Su Chen smiled slightly, signaling the other party to continue.

Han Shijie instructed his assistant to take out a document and place it on the coffee table in front of Su Chen.

"We at Xingyao Technology are paying close attention to your company's upcoming H-Link low-altitude communication protocol."

Han Shijie spoke sincerely, looking directly at Su Chen.

"To be honest, although Xingyao has been manufacturing communication modules for your company, Hongyuan's underlying communication technology architecture—especially the adaptive channel management solution that your team is developing—has greatly impressed our engineers."

At this point, Han Shijie's expression became serious.

"Mr. Su, to be frank, Xingyao Technology wants to obtain a deep development license for the H-Link protocol."

He stood up and bowed slightly to Su Chen.

"Although Xingyao has its own communication module design capabilities and can develop products based on open standards, the performance gap between open standards and H-Link in low-altitude scenarios is simply too large."

If your company can license H-Link's protocol development level to us, Xingyao is willing to pay patent licensing fees and offer Hongyuan greater price discounts in communication module manufacturing.

From now on, Xingyao will offer Hongyuan the best price of 5% above cost for the communication modules it manufactures!

Su Chen took the document but didn't open it right away.

"Developer-level license for the H-Link protocol..."

He narrowed his eyes slightly.

To be honest, Su Chen wasn't entirely surprised that Han Shijie would come to request H-Link's authorization. But he didn't expect the other party to come before the press conference—which showed that Han Shijie's judgment of H-Link was very sharp, and he had sensed the value of this agreement in advance.

Su Chen already had a complete idea for H-Link's licensing system.

The first level is basic compatibility authorization—enterprises can produce devices compatible with the H-Link protocol, but cannot access the protocol's underlying code; they can only call the standard interfaces provided by Hongyuan. This is the default authorization level for most Feiniao platform customers.

The second level is module integration licensing—enterprises can integrate the H-Link protocol into their own communication module products, possessing a certain degree of customization capability. This is the licensing level for professional communication module manufacturers.

The third level is protocol development licensing—enterprises can develop their own communication solutions based on H-Link's underlying protocol architecture, which is equivalent to obtaining H-Link's core design blueprints, allowing them to make in-depth innovations on this basis.

The fourth level is a buyout license—the company can permanently own all intellectual property rights to the H-Link protocol, including the right to modify and redistribute it. Su Chen will absolutely not grant this level to anyone.

Just as ARM would never sell the permanent buyout rights to its instruction set to any chip manufacturer, Su Chen would not hand over the roots of H-Link to anyone else.

Han Shijie was seeking the third level – protocol development license.

Su Chen opened the document.

The contract was written very professionally, clearly showing that Xingyao's legal team had put a lot of effort into it. The core terms included: a one-time licensing fee of eight million yuan, a patent licensing fee of 3% of the ex-factory price for each subsequent device equipped with H-Link, and a reduction in the OEM price from the current cost plus 15% to cost plus 5%.

Su Chen spent about five minutes reading through the entire contract from beginning to end, then looked up at Han Shijie.

"Mr. Han, I see your company's sincerity. Most of the terms are negotiable, but there's one point I need to clarify beforehand."

Han Shijie's expression hardened slightly: "President Su, please speak."

"There is a prerequisite for the development-level licensing of the H-Link protocol: all new technology extensions, new protocol modules, or new communication algorithms developed based on the H-Link underlying protocol must be automatically licensed back to Hongyuan."

There was a two-second silence in the meeting room.

Han Shijie's expression changed.

"Mr. Su, do you mean... if Xingyao develops a new communication protocol extension based on H-Link, the intellectual property rights of these new technologies should be automatically shared with Hongyuan?"

"It's not sharing, it's licensing. The intellectual property rights still belong to Xingyao, but Hongyuan has the right to use and integrate it for free."

Su Chen's tone was calm, but his attitude was very firm.

Han Shijie fell silent.

He certainly understood what this meant. If Xingyao obtained the H-Link protocol development license, given Xingyao's R&D capabilities, it would definitely develop its own communication protocol extensions based on H-Link in the future—these extensions might involve optimization algorithms for specific industry scenarios, new frequency band management schemes, or even entirely new networking modes.

These are all valuable technological assets.

Su Chen is now demanding that these technological assets be automatically licensed back to Hongyuan, which means that Hongyuan can use the new technologies that Xingyao has worked so hard to develop for free.

"President Su, if I may be frank, this condition is a bit difficult to accept."

Although Han Shijie's tone was restrained, it was clearly tinged with resistance.

"Currently available open communication protocols, including the LoRa Alliance and the Zigbee Alliance, do not have such provisions. It's like we spend money to buy a sapling, painstakingly grow it into a large tree that bears fruit, only to have to share the fruit with the person who sold the sapling."

Su Chen did not respond immediately, but instead picked up the teacup in front of him and slowly took a sip.

"Mr. Han, I understand your concerns. But I'd like to ask you to consider this issue from a different perspective."

He put down his teacup, his gaze becoming serious.

"H-Link is not a product; it's an ecosystem. The value of a communication protocol doesn't depend on how advanced it is, but on how many devices use it, how many developers contribute code to it, and how many scenarios rely on it to run."

"My request for automatic licensing of the technology extension is not to take advantage of Xingyao, but to ensure the uniformity and forward compatibility of the H-Link protocol."

"Think about it, if ten companies all obtain H-Link's development-level license, and each makes different modifications and extensions to the underlying protocol, but these modifications are incompatible with each other—then after five years, H-Link will be fragmented into ten incompatible versions. At that point, H-Link will no longer be one standard, but ten standards."

"Therefore, as the initiator and maintainer of H-Link, Hongyuan must have a comprehensive understanding of all protocol extensions. Only in this way can we ensure that the core version of H-Link can continuously absorb the best technological innovations, maintain backward compatibility, and benefit all participants in the ecosystem."

Su Chen paused for a moment, then added:

"In other words, every technological expansion contributed by Xingyao will ultimately benefit the entire ecosystem—including Xingyao itself—through upgraded versions of H-Link. This is not a zero-sum game, but a positive-sum game."

After hearing these words, Han Shijie did not respond immediately, but instead lowered his head and pondered for a long time.

His fingers tapped unconsciously on the edge of the coffee table, making a rhythmic "tap-tap" sound.

Su Chen didn't urge him, but waited quietly.

To be honest, Su Chen's insistence on this clause was not just due to technical considerations.

The deeper reason is that he wants H-Link to become the "ARM" of low-altitude communication.

In the virtual disassembly lab, the system showed him a clear technical roadmap: if H-Link can become the de facto standard protocol in the field of low-altitude communication within the next three to five years, then all devices, software and services developed based on H-Link will constitute a huge ecosystem.

Whoever controls the core protocols of this ecosystem controls the entire communication infrastructure of the low-altitude economy.

Just as ARM controls the instruction set standard for global mobile chips, Su Chen wants Hongyuan to control the protocol standard for low-altitude communication.

To achieve this goal, relying solely on the R&D capabilities of Hongyuan is far from sufficient. It requires the collective strength of the entire industry to improve H-Link—every company that obtains developer-level authorization is a contributor to the H-Link ecosystem, and the new technologies they develop will benefit the entire protocol system.

However, the prerequisite is that these contributions must be grasped and integrated by Hongyuan; otherwise, H-Link will be eliminated due to fragmentation, just like many open standards in history.

Therefore, Su Chen will never compromise on this "automatic licensing of technology extensions" clause.

Just like his approach to the instruction set issue—he only allows up to level three, never level four. The root of the protocol must be in Hongyuan's hands.

The silence lasted for about two minutes.

Finally, Han Shijie raised his head and looked into Su Chen's eyes.

"President Su, if I say Xingyao can accept this term—I have one additional condition."

"you say."

"Although the technical extensions contributed by Xingyao are automatically licensed to Hongyuan, Hongyuan must indicate the source of the technology and credit Xingyao's contributions in the relevant technical documents when incorporating these extensions into the H-Link core version."

Su Chen nodded almost without hesitation: "Okay. That's a reasonable request. Hongyuan respects the intellectual property rights of every contributor to the ecosystem."

Han Shijie took a deep breath and then extended his right hand.

"Then I wish us a pleasant cooperation."

Su Chen grasped his hand.

"It's a pleasure working with you."

The moment their hands clasped tightly together, Su Chen knew that another important piece of the puzzle had been added to H-Link's ecosystem blueprint.

The addition of Xingyao Technology means more than just a licensing fee and lower manufacturing costs. More importantly, it represents H-Link's transition from an internal technical solution of Hongyuan to an open protocol with external ecosystem participants.

The formal contract details were then handed over to Fang Xu and Xingyao's legal team; Su Chen and Han Shijie only needed to sign them.

That same evening, news of Hongyuan Intelligent and Xingyao Technology signing a letter of intent for H-Link protocol development-level licensing was disseminated through industry media.

……

The news caused an uproar in the industry.

"Hongyuan licensed H-Link to Xingyao? Isn't that handing over core technology?"

"The person upstairs is too short-sighted. H-Link is a communication protocol, not a product. The more people use a protocol, the more valuable it becomes. Look at the WiFi protocol, look at the Bluetooth protocol—aren't they used by companies all over the world?"

"Exactly. If the entire industry develops low-altitude communication products based on H-Link, then H-Link can become the de facto standard. At that point, Hongyuan will be the ARM of the low-altitude communication industry."

"Aren't you overthinking it? Huawei is about to enter the market, and DJI also has OcuSync. What makes H-Link the standard?"

"It's precisely because Huawei and DJI have their own solutions that H-Link's choice to be open makes sense. Huawei and DJI's solutions are closed—if you use OcuSync, you can only buy DJI products; if you use Huawei's solution, you're locked into Huawei's ecosystem. If H-Link truly achieves openness, small and medium-sized enterprises that don't want to be tied to DJI and Huawei will choose H-Link."

"That makes sense. However, Su Chen's move is quite bold; he's already building an ecosystem before the H-Link prototype is even out."

"That's vision. Su Chen isn't creating a product; he's creating a standard. The approaches to creating a product and creating a standard are completely different—creating a product requires concealment, creating a standard requires openness."

"So Hongyuan isn't afraid that Xingyao will create something better based on H-Link and surpass them?"

"What's there to be afraid of? I heard there's a technology feedback clause in the agreement. Xingyao will automatically license the new technologies it develops based on H-Link to Hongyuan. It's like Su Chen planting an orchard and then asking others to help graft new varieties—the new varieties go to those others to sell, but Su Chen can also plant them for free. The longer it goes on, the more diverse his orchard's varieties will become."

"That's a ruthless move..."

An article on Zhihu titled "H-Link Open Licensing: Su Chen is Playing a Very Long Game" has received over two thousand likes. The article's core argument is that Su Chen isn't selling technology, but rather building an ecosystem. H-Link's open licensing strategy, seemingly sharing core assets, is actually using the power of the entire industry to work for Hongyuan.

The debate in the comments section continued until the night before the press conference.

But regardless of what others say, everyone's attention is focused on the same point in time—

7 month 18 day.

……

Late the night before the press conference, Su Chen was alone in his office making final preparations.

Zhou Ming knocked on the door and came in to report the list of attendees for tomorrow's meeting.

"Mr. Su, the number of confirmed business representatives has exceeded six hundred. Almost all of Feiniao platform's partner clients are present, and more than fifty other companies without prior partnerships have also voluntarily registered."

What about DJI?

"Chen Jiaming came in person. He brought three people with him, including a person in charge of communications technology."

Su Chen raised an eyebrow slightly. The head of DJI's corporate strategy department was present in person, along with people from the communications technology department—this indicated that DJI wasn't just there for show, but to assess the situation.

What about Huawei?

"Huawei's Low-Altitude Intelligent Connectivity Lab sent a deputy director over, named Cheng Weiyuan."

This is even more interesting. Huawei's Low-Altitude Intelligent Connectivity Lab was established less than a month ago, yet they sent representatives to attend Hongyuan's press conference—indicating that Huawei is also paying close attention to H-Link.

"Hangxindatong?"

"He Zhiqiang didn't come, but Hangxindatong sent a technical vice president. Presumably, he's here to see how Hongyuan plans to handle the LDCL compatibility issue."

Su Chen nodded without saying anything more.

"There's one more person," Zhou Ming said with a hint of surprise, "Xia Kanghao from Haotai Capital has also confirmed his participation."

"Xia Kanghao?" Su Chen was slightly surprised. "What's he doing here?"

"I'm not sure. He only confirmed it this afternoon. When he registered, he filled in 'Chairman of Haotai Capital' instead of any title related to Tianying Technology."

Su Chen was silent for a few seconds, then chuckled softly.

"interesting."

Su Chen had never let his guard down around Xia Kanghao. Acquiring Tianying, initiating patent lawsuits, secretly stirring up trouble—this man's methods were numerous. His attendance at Hongyuan's press conference as an investor now was probably not for show of support.

It doesn't matter.

At tomorrow's press conference, Su Chen will showcase something truly impressive. Regardless of whether the attendees are friends or rivals, their reaction upon seeing the actual technical solutions will be the same—a reassessment of Hongyuan's capabilities.

"Is there anything else?" Su Chen asked.

"There's one person who's a bit special," Zhou Ming said, flipping through the list. "Mr. Zhou Zhenguo of Lianchuang Group has confirmed his attendance. He didn't fly in from Beijing; he changed his flight back from the US at the last minute to come back specifically for this event."

A hint of warmth flashed in Su Chen's eyes.

The collaboration between Lianchuang Group and Hongyuan has a long history, and Zhou Zhenguo has always been one of Su Chen's most reliable allies in terms of capital. He changed his flight from the United States to rush back to attend the press conference, and Su Chen appreciated this gesture.

"Okay, I understand. Go and get some rest; tomorrow is a big day."

Zhou Ming turned and left.

Su Chen sat alone in his dimly lit office, with his speech for tomorrow's press conference and an overview of H-Link's technical architecture in front of him.

He didn't look at the documents again—he already knew their contents by heart.

He simply sat quietly for a while, watching the distant factory lights in the night sky of Longhua outside the window.

It has been exactly four years and four months since I inherited Hongyuan Intelligent Technology in 2016.

From a small flight control workshop with annual revenue of less than three million to a new force in the low-altitude economy with more than 300 cooperative clients, annual revenue of over 100 million, and the two trump cards of the Flybird platform and H-Link, this journey has not been easy.

The relentless pursuit and blockade by Tianying, the capital attack by Haotai, the head-on crushing by DJI, the standard barriers of LDCL, and the covetous gaze of Huawei...

Each hurdle is enough to crush an ordinary company.

But Hongyuan pulled through.

Moreover, they not only survived, but also reached an unprecedented height.

Tomorrow's press conference will be a crucial step for Hongyuan in its transformation from a flight control company to a low-altitude communication infrastructure platform.

Su Chen took a deep breath and then closed the folder.

That's enough. The preparations have been perfected; the rest is up to tomorrow's stage.