At least with the limited contact I've had with Chinese and Japanese developers the level of English wasn't particularly high, so I guess I'm a bit surprised by that. In the Chinese teams they even went as far as to try to suck in someone from Hong Kong so that he could be the bridge between the Chinese and German (the team I was on, though communicating in English) groups.
As to the observation of different Chinese dialects using English as an interlanguage within China (...I assume you didn't mean within China)...this is probably very rare. In my 9 years of living in China mingling with all sorts of regional and ethnic groups, I have never once seen this happen.
Now, given that a Japanese and a Korean are to communicate, of course it's more likely that they will do so in English.
Linguist David Crystal, who has surveyed world use of one or another "interlanguage" for official use by international organizations, has found that actually most frequent and most exclusive use of English as an interlanguage is in east Asia. It is remarkably "natural" for a Korean person to try speaking English to a Japanese person (even though Korean and Japanese are cognate languages), and it is more expected still for a Chinese person to speak with either of them in English. What I find remarkable, but have observed more than once, is speakers of different Sinitic languages ("Chinese dialects") speaking to one another in English. Online, which is mostly the context Jeff is talking about in his blog, the early inconvenience of typing in the CJK languages (now resolved, as an in-country issue, but still a big barrier to switching among those languages) resulted in much Internet communication in east Asia being in English by default.
After edit: France was mentioned in the reply above to which I reply here, and I'll mention that the Carrefour retail chain has stores in Taiwan, and the signs inside the stores are in Chinese, of course, but also in English, NOT in French. There is no reason of national pride among the Carrefour staff sufficient to overcome the practicality of using English to reach customers in Taiwan. (Taiwan has a large population of English-speaking foreigners, the plurality of whom are Philippine guest workers.)