image missing
Date: 2024-07-24 Page is: DBtxt003.php txt00012124

China has made it. Next question


Peter Burgess

Gmail Peter Burgess
China has made it. Next question
Bloomberg Technology Fri, Oct 28, 2016 at 7:02 AM

Hi all, it’s Eric. Is China great or the greatest?

That's the debate investors Jim Breyer and Kai-Fu Lee seemed to be having onstage at the Wall Street Journal’s tech conference this week in Laguna Beach, California. Here are a couple of choice quotes, courtesy of the newspaper: “A lot of people in the U.S. just don’t realize how strong the Chinese entrepreneurial, engineering, product, research capabilities are,” Lee said. American companies have been “darn too arrogant” about their China strategies, Breyer said.

Guys, what year is this? It’s possible there are some people in the world who aren’t aware of what’s happening in China right now (even if they have downloaded on their phones), but anyone paying attention to the tech industry knows that Beijing, Shanghai and Shenzhen are bigger threats to Silicon Valley’s dominance than Berlin, London or New York. We know that Facebook is, in many ways, trying to copy WeChat, not the other way around. Didi Chuxing is the Uber Slayer. The U.S. ride-hailing giant didn’t blame its exit on government intervention. Didi won a fair fight. I don't know anyone who still thinks Chinese tech giants are just a bunch of copycats.

While many still want to pay tribute to the latest tech superpower, there are so many more important things to talk about. Let’s all accept right now that Chinese technology companies are legit and look at more pressing questions:

Will the flow of Chinese money into U.S. technology companies slow down?

Fang Bao, the CEO of investment bank China Renaissance, spoke on stage at the Journal’s conference this week. He said he believed that money flowing from Chinese retail investors to early-stage Silicon Valley startups would shrink following regulatory changes in China. But money from big institutional investors into what he called “branded unicorns” would continue, he said. And he quietly raised an important red flag. Chinese banks are backing those investments, creating senior tranches and junior tranches. “It used to be called CDOs in the market, right? So that is very problematic,” Bao said.

Will Chinese technology giants soon make big moves outside of China?

India and Southeast Asia seem like obvious candidates for expansion. But it was Chief Executive Officer Jeff Bezos who said at Vanity Fair’s conference last week that his company is dominating the local Indian e-commerce market, edging out hometown hero Flipkart. Sorry, Jack Ma.

Alibaba and Tencent have made big global bets—and Dalian Wanda purchased the film company Legendary Pictures—but a question on everyone’s mind is, “When will we see the first truly international Chinese giant?” Didi seems like one of the more logical Chinese companies to go global. The company’s president, Jean Liu, said as much. “We intend to go global, and we aspire to be a global company,” she said on stage this week. “We're still doing some market studies so I would say stay tuned. … If we go overseas there's a very good chance we will collaborate, and there’s a very good chance we will compete.”

Here are a handful of other questions that aren’t being talked about enough: When will Facebook and Google be allowed to compete in China? What can the tech industry do to promote free speech in China? Has Barron’s abandoned its questions about Alibaba’s financials?

The Chinese tech industry isn’t a novelty. Let’s not treat it like one. —Eric Newcomer

And here’s what you need to know in global technology news

Qualcomm is driving into the car business with a $47 billion deal. The world’s largest mobile chipmaker is acquiring NXP Semiconductors, the biggest supplier of silicon used in the automotive industry. That’s assuming the EU’s antitrust authority doesn’t try to block the transaction.

Uber stuck its head in the clouds. The company outlined its concept for flying cars. It also made what it says is the world’s first commercial delivery using a self-driving truck packed with Budweiser. Uber’s fanciful moves aren’t impressing competitors. Juno’s CEO called Uber “truly evil,” and Elon Musk made a populist pitch to destroy the ride-hailing leader.

Snapchat is looking to raise as much as $4 billion in an IPO. The offering could value Snap Inc., parent of the photo-messaging app, at about $25 billion to $35 billion.

Twitter’s “Firehose” has a dark side. Some government authorities use tweet data to track dissidents, Bloomberg Businessweek has learned through dozens of interviews with industry insiders and more than 100 requests for public records from law enforcement agencies in the U.S. Of course, Twitter has plenty of other things to worry about right now. While it beat revenue estimates last quarter, the company is cutting 9 percent of staff and killing Vine, a once-beloved micro-video app.

A Japanese billionaire’s robot dreams are on hold. SoftBank’s Masayoshi Son had high hopes for Pepper, but the humanoid machine ultimately became yet another cool-but-impractical robot. SoftBank is somewhat preoccupied now with its acquisition of ARM and a $100 billion tech fund started with Saudi Arabia.

Apple is adding a touchscreen to its laptops. A strip at the top of the keyboard called the Touch Bar will change depending on the app you’re using, offering music controls or a row of emoji. The company is hoping to claw back some lost market share in the PC business. Meanwhile, the Apple TV is getting a channel guide; the AirPod wireless headphones are delayed; and the company is developing a car operating system in BlackBerry’s backyard.

The Democrats almost certainly weren’t hacked by a 400-pound guy sitting on a bed, as Donald Trump had suggested in a presidential debate. In the latest episode of Bloomberg Technology’s Decrypted podcast, find out how cybersecurity experts tracked the hack on the Democratic National Committee back to Russia. Subscribe to the show on iTunes or Pocket Casts.

Alphabet and Tesla earnings impressed. The search giant’s sales topped analyst estimates, and it slipped a nerdy Easter egg into its latest share buyback. Tesla posted a rare profit. But Samsung investors were concerned about continued fallout from the recent Note 7 crisis, and Amazon’s stock took a hit for the company’s lack of holiday spirit.

You received this message because you are subscribed to the Bloomberg Technology newsletter. You can tell your friends to sign up here. Unsubscribe | | Contact Us Bloomberg L.P. 731 Lexington, New York, NY, 10022

SITE COUNT Amazing and shiny stats
Copyright © 2005-2021 Peter Burgess. All rights reserved. This material may only be used for limited low profit purposes: e.g. socio-enviro-economic performance analysis, education and training.