Monday, August 1, 2016

Assorted China Tech Links: Innovation and Control Mix, a Reason to Break Through, and Uber China Sold

Some longtime readers will remember the days when there was a more explicit tech focus here, and I hope to soon return to some old themes. For now, I will keep it simple and share links to six pieces on China tech:

1. Emily Rauhala pushes back against the idea that heavy censorship by the government means tech innovation has been stifled in China:
“You go on Facebook and you can’t even buy anything, but on WeChat and Weibo you can buy anything you see,” said William Bao Bean, a Shanghai-based partner at SOS Ventures and the managing director of Chinaccelerator, a start-up accelerator.

“Facebook’s road map looks like a WeChat clone.”

2. Despite the innovation, not everything is rosy about the Chinese internet. Christina Larson captures some of how the good and the bad fit together:
These stark contrasts—an Internet that is simultaneously dynamic and lethargic, innovative and stultifying, liberating yet tightly controlled—are easier to understand when you realize they are not necessarily contradictions. Being forbidden to develop tools for stimulating free expression or transparency essentially forces Chinese entrepreneurs to concentrate their resources on services that facilitate commerce, convenience, and entertainment. And the more successful those kinds of businesses become, the more money they and their investors have at stake, possibly cementing the status quo.

3. Zheping Huang looks at a specific case where Chinese people who previously didn't see a need to access online information and services blocked in China finally felt compelled to use a VPN to break through the Great Firewall:
Recently, hundreds of Chinese investors, who may be out $6 billion in one of China’s biggest financial scams, have leaped over the Great Firewall in an organized, determined way. After being ignored by China’s regulators and lawmakers, these desperate investors are pouring into Twitter to spread news of their plight.

While their numbers are small, their actions are already inspiring other Chinese investors burned in a monumental number of recent scams, turning Twitter into a new venue for angry Chinese citizens to protest. And as they leap over the Great Firewall, some are coming to a new realization—the government has been cracking down on free speech and civil protests just like theirs for years.

4. For something fresh from today, there is big news about Uber and Didi Chuxing:
Didi Chuxing, the dominant ride-hailing service in China, said it will acquire Uber Technologies Inc.’s operations in the country, ending a battle that has cost the two companies billions as they competed for customers and drivers.

Didi will buy Uber’s brand, business and data in the country, the Chinese company said in a statement. Uber Technologies will receive 5.89 percent of the combined company with preferred equity interest equal to 17.7 percent of the economic benefits.

5. The sale of Uber China comes as no huge surprise to many. Heather Timmons highlights how the writing was on the wall:
Then things got even worse—Beijing started to openly back Didi, with an investment by China’s sovereign wealth fund into the new Chinese giant. China’s state banks rolled out billions of dollars in loans to Didi.

In August 2015, Uber reported it was being scrubbed from WeChat, a move, Quartz wrote, that was “almost certainly designed to protect and promote Didi Kuaidi” and make it hard for Uber to do business.

6. And Josh Horowitz takes a quick look at the impact of beyond China:
Didi’s $1 billion investment in Uber likely gives it only a minuscule stake in the ride-hailing giant. But it nevertheless means it has its hands in every single one of its potential major competitors.

This changes perceptions of the future of the ride-hailing industry.

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