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China fears Jack Ma’s media power is too great

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Media platforms are Alibaba’s powerful weapons. However, the conglomerate’s ability to control over information too much concerns Beijing’s government.

According to the Nikkei Asian Review After a record $ 2.8 billion fine, trouble is not over for Alibaba’s billionaire Jack Ma. Because the corporation’s media empire worries the Chinese authorities. Alibaba is famous for e-commerce platforms like Taobao and Tmall. However, it also owns a media empire that includes media, media and broadcasting, social media platforms, video streaming websites, film production companies, and advertising agencies. . The above media platforms are effective tools to promote other Alibaba businesses. Like Alibaba, many tech companies are competing to build a vast ecosystem, from e-commerce to entertainment. Alibaba could continue to face trouble after a record $ 2.8 billion fine. Photo: Reuters. Communication power However, as the influence grew, Alibaba fell into the sights of the Beijing authorities. Fintech (financial technology) company Ant Group was asked to postpone its IPO (initial public offering) at the end of last year. By mid-March, Beijing asked Alibaba – which now owns the flyer South China Morning Post – divestments in the media sector due to fears of the company’s growing influence, according to the company Wall Street Journal. Out South China Morning Post Alibaba owns video streaming platform Youku and a 30% stake in social networking site Weibo. The group also invests in Bilibili, known as the Chinese version of YouTube, news conglomerate Yicai Media Group, news websites. 36Kr, Huxiu.com and Focus Media – China’s largest offline advertising agency. “To be fair, Alibaba’s control over information, media and personal data in China has outstripped the tech giants in other countries,” said Professor Zhu Ning at Hoc commented Shanghai Advanced Finance Institute. Alibaba’s control over information, media and personal data in China has outstripped tech giants in other countries. – Professor Zhu Ning Last December, the business news site Huxiu – funded by Ant – has targeted Chinese antitrust regulations. Huxiu warns that Beijing’s tightening of regulation will affect Internet companies and hurt the country’s economy. The article was published after China’s market regulator opened an investigation against Alibaba. The four-month investigation ended with a record 18 billion yuan ($ 2.8 billion) fine for Ma’s group. However, the post was removed from Huxiu’s website shortly after. The site also stopped posting news for a month. Last year, Weibo was also found to have deleted posts, closed comments, and removed highly searched topics in an attempt to quell rumors related to a senior Alibaba executive. Alibaba is Weibo’s second largest shareholder and largest ad customer. “Alibaba’s power to shape public opinion is amazing,” the paper said People’s Daily of the Chinese state. Alibaba invests heavily in the media sector, including newspapers, electronic media and broadcasting, social networking platform … Photo: Nikkei Asian Review. As the user’s information source increasingly depends on technology platforms, the influence of these platforms on the public opinion increases. That forces the Chinese regime to change its attitude. In fact, in 2014, the Chinese government openly encouraged the traditional media and Internet companies to further combine and invest in each other. At the moment, authorities are concerned that Alibaba’s excessive control over the media will help it strengthen its dominance in many other sectors outside of e-commerce and finance. online. Media investments mean a lot for Alibaba, analysts say. Tencent Holdings – a rival of Alibaba – owns messaging app WeChat and ByteDance, the parent company of TikTok (known in China as Douyin). Meanwhile, billionaire Jack Ma’s group lacks self-developed media platforms to attract and retain users. “An ecosystem that lacks a media platform is at a disadvantage in terms of competition. Looking at competitors, Alibaba sees the benefits of having media resources,” Nikkei Asian Review quoted Mr. Martin Bao, an analyst at ICBC International in Shanghai, commented. Fierce competition Tencent’s 1 billion WeChat user platform is the driving force behind the growth of e-commerce site Pinduoduo. Tencent is the second largest shareholder in Pinduoduo. Thanks to the huge number of users, short video platform Douyin is also able to quickly grow its e-commerce business through live streaming. The media also helps increase advertising revenue. “Advertising is the core business of Internet corporations, bringing stable revenue and low cost,” Bao explained. Alibaba does not disclose advertising revenue in its financial statements. However, in 2017, Alibaba CFO Meggie Wu said 60% of the company’s revenue came from advertising platforms. Stores buy advertising space on Alibaba’s websites and corporate media partners. The Chinese regime’s message is very clear. They decide what people should pay attention to, not private corporations – Associate Professor Fang Kecheng According to research firm eMarketer, Alibaba accounts for more than 30% of the Chinese e-advertising market in 2020. The group cooperates with more than 4,000 media partners, 100,000 mobile applications, reaching 98% of the population. in a country with a billion people. Alibaba’s media investment “is primarily aimed at expanding the ecosystem at all costs to prevent other companies like Tencent and Baidu from dominating,” said Leo Sun, a technology expert at The Motley Fool. cyber “. Alibaba’s rivals also invest significantly in the media. For example, in 2020, Baidu spent $ 3.6 billion to acquire the social media platform Joyy’s live-streaming business. Tencent developed its own video platform and online news site, and invested in Kuaishou and Bilibili. The Alibaba founder’s influence in the Chinese business world attracts the attention of the Beijing authorities. Photo: Reuters. However, Mr. Sun believes that corporations like Tencent, Baidu and ByteDance are unlikely to fall into the sights of Beijing authorities like Alibaba. Their investments are still related to the core business and not as extensive as Alibaba. Meanwhile, Alibaba founders are often known for their unique ideas. Mr. Ma also likes to convey his message to a wide audience. He even opened a business school for Chinese business leaders. Ma’s influence in the business world caught Beijing’s attention. Sheet Financial Times reported that his school had been forced to stop training. “The Chinese government’s message is very clear. They decide what people should pay attention to, not private corporations,” said Associate Professor Fang Kecheng at the Zhongshan Zhongzheng University.

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