Bottom line: The recent case involving criticism of Alibaba by Washington and Beijing over piracy should form a template for how the 2 governments can collaborate on commercial issues where they have common interests.
US warns Alibaba over fake goods
Washington and Beijing showed a rare sign of collaboration on commercial issues last week when the US sternly rebuked e-commerce giant Alibaba (NYSE: BABA) for widespread trafficking of pirated goods on its websites, reinforcing a similar message delivered by China at the start of this year. While it’s doubtful the US Trade Representative’s (USTR) office and China’s State Administration for Industry and Commerce (SAIC) consulted each other in their separate actions, the parallel moves showed just how effective the 2 governments can be when they work together in some of the many areas where their interests overlap.
That contrasts sharply with a more clashing style on many other issues like high-tech hardware security and new energy products, where both sides have similarly common interests but more often take actions that result in trade wars and angry verbal exchanges. Read Full Post…
The following press releases and media reports about Chinese companies were carried on December 22. To view a full article or story, click on the link next to the headline.
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Alibaba (NYSE: BABA) Hires Ex-Apple Investigator for Global Anti-Piracy Fight (English article)
OnePlus Denies Merger Rumors with Oppo, Says Layoffs Part of Improvement Plan (Chinese article)
Suning (Shenzhen: 002024) Invests 523 Mln Yuan in Jiangsu Soccer Club (Chinese article)
SABMiller (London: SAB) China Partner Said to Pick Banks to Advise on Snow JV (English article)
Bottom line: Yirendai’s IPO could auger a wave of similar new listings by Chinese P2P lenders next year in Hong Kong and China, though few are likely to choose New York due to fading sentiment from US investors.
IPO fizzles for P2P lender Yirendai
What’s likely the be the final Chinese IPO in New York for 2015 has debuted with a very appropriate thud, capping a year that saw just a handful of companies make such new listings. The latest IPO by P2P lending platform operator Yirendai (NYSE: YRD) has a few noteworthy angles, led by a 9 percent drop in its trading debut on Wall Street at the end of last week.
The investor indifference to Yirendai nicely summarizes what has been a dismal year for new Chinese IPOs in New York, as investors worry about China’s slowing economy and also lose interest in these smaller companies whose longer term prospects are unclear. At the same time, Yirendai marks the first IPO for China’s young stable of P2P lenders, and is likely to be followed by more next year. This debut will hardly encourage those companies to go to New York, and many could instead look for friendlier sentiment in Hong Kong or even on one of China’s newer boards for high-growth, unprofitable companies. Read Full Post…
Bottom line: Apple’s and Samsung’s simultaneous new mobile payment tie-ups with UnionPay indicate Beijing will open the market next year to foreign companies, many of whom may choose to partner with not only UnionPay, but also Alibaba or Tencent.
Apple ties with UnionPay
In what should come as a big surprise to no one, Apple(Nasdaq: AAPL) has formally announced a tie-up with Chinese electronic payments giant UnionPay to bring its Apple Pay service to China as soon as early next year. This particular development isn’t hugely unexpected, since Apple CEO Tim Cook had previously talked of such plans and media reported Apple was close to such a deal last month. (previous post)
What does come as a slight surprise is the addition of Samsung’s (Seoul: 005930) name to the latest reports, as the South Korean smartphone giant announced its own separate deal with UnionPay. Apple’s choice of UnionPay also is a slight surprise, since the earlier reports only said that Apple was in talks with several major Chinese banks. Last but not least, this latest announcement seems to be the strongest indicator yet that China will finally open up its electronic payments market to foreign companies in the first half of next year. Read Full Post…
Bottom line: Alibaba is the biggest winner by keeping its name off an annual US piracy list, but the victory is only partial due to a strong warning in the report to improve its anti-piracy efforts.
US warns Alibaba to step up anti-piracy actions
After months of behind-the-scenes lobbying in Washington, e-commerce giant Alibaba (NYSE: BABA) has managed to keep its name from reappearing on an annual US list of “notorious” global markets for piracy that has just been published. But the victory is really only partial, since the US Trade Representative’s (USTR) office has devoted quite a lot of space to Alibaba in the latest edition of its Notorious Markets report, expressing its concerns about the rate of trafficking in pirated goods on some of Alibaba’s sites.
This long-awaited decision appears to be a compromise, aimed at appeasing some groups that wanted to see Alibaba’s name reappear on the list, including the American Apparel & Footwear Association, which issued several strongly-worded statements on the matter. The matter put the USTR in an awkward position, because it had previously removed Alibaba’s name from the list in 2012, only to see Alibaba strongly criticized for continued rampant piracy by Beijing early this year. Read Full Post…
Bottom line: The lack of news or attendance by major worldwide executives at China’s global Internet conference this week shows the country’s Internet remains relatively closed and under strict government control.
Global Internet pow-wow takes place in scenic Wuzhen
I had big hopes for the second edition of China’s World Internet Conference happening this week in the picturesque town of Wuzhen, as all of the country’s top executives are in attendance at an event intended to showcase the country’s online prowess. The list of domestic executives in attendance certainly hasn’t disappointed, and many are undoubtedly there to network with China’s top Internet bureaucrats and President Xi Jinping, who gave this year’s opening speech.
But a look at some of the comments from names like Alibaba (NYSE: BABA) founder Jack Ma and Baidu (Nasdaq: BIDU) founder Robin Li turns up mostly empty talk, mixed with the expected self-promotion. What’s more, I also find the near-absence of any major foreign names from the conference somewhat puzzling, since China is trying to bill this as a global conference. Read Full Post…
Bottom line: UnionPay’s launch of a new mobile payments service is a long-overdue answer to challenges by Alibaba and Tencent, and is somewhat late but also vital to maintaining its eroding position in China’s electronic payments market.
UnionPay rolls out mobile wallet card
After coming under growing assault over the last 2 years from the private sector, state-run behemoth UnionPay is finally fighting back by launching a mobile-based payment service to counter rival products from Internet giants Alibaba (NYSE: BABA) and Tencent(HKEx: 700). There’s no mention of either of China’s top 2 Internet companies in an announcement of the new service from UnionPay, even though Alibaba’s Alipay Wallet and Tencent’s WeChat Pay are clearly present in the subtext.
UnionPay is just the latest big state-run company to feel the heat of private sector competition, which is shaking up China’s entire financial sector that was previously dominated by big state-run companies. But UnionPay’s case is even more extreme, since the company operated a state-granted monopoly financial transactions settlement network for the first decade of its existence, similar to global systems run by credit card giants MasterCard (NYSE: MA) and Visa (NYSE: V). Read Full Post…
Bottom line: Alibaba’s new Disney tie-up is unlikely to gain much traction due to overcrowding in China’s Internet video market, while its tie-up to sell $8 billion worth of bad debt from asset manager Huarong looks mildly positive.
Alibaba in streaming tie-up with Disney
E-commerce giant Alibaba(NYSE: BABA) is in a trio of headlines as we head into the year-end holidays, led by a new tie-up with Disney (NYSE: DIS) as it looks to leverage its growing stable of media assets. But in a sign of how much attention the company now attracts, the other 2 stories in the headlines aren’t really ones that Alibaba would care to trumpet too much.
The larger of those is mildly positive, with media reporting that Alibaba’s Taobao C2C marketplace is teaming up with one of China’s leading bad asset sellers to auction off $8 billion in soured loans. The other headline is one that’s becoming a small headache for Jack Ma, and involves Evergrande Taobao the soccer team that he co-owns. That story has one of Japanese car maker Nissan’s (Tokyo: 7201) China joint ventures suing the club for breach of contract related to a high-profile sponsorship dispute. Read Full Post…
The following press releases and media reports about Chinese companies were carried on December 16. To view a full article or story, click on the link next to the headline.
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Disney (NYSE: DIS), Alibaba (NYSE: BABA) Team to Stream Films to Chinese Viewers (English article)
Huawei Says 2015 Sales to Top $60 Bln, up More Than 29 Pct from 2014 (Chinese article)
China Mobile (HKEx: 941) Expects to Break 500 Mln 4G Users by End 2016 (English article)
Bottom line: Jack Ma’s hubris is the main driver behind Alibaba’s purchase of the South China Morning Post, and the newspaper’s declining fortunes are unlikely to reverse under its new ownership.
Pride drives Jack Ma’s SCMP purchase
After weeks of speculation, e-commerce giant Alibaba (NYSE: BABA) has finally announced its purchase of Hong Kong’s SCMP Group (HKEx: 583), parent of one of Asia’s oldest and most influential newspapers, the South China Morning Post. Many reports are focusing on the implications of mainland Chinese ownership of a major newspaper in Hong Kong, where editorial standards are much more western and strict self-censorship policies like those required by Beijing don’t exist. But in my view, it’s more interesting to look at what this deal means commercially for Alibaba, and whether it makes sense.
Let’s begin with the news, which came as a slight surprise because it will see Alibaba buy the media assets of SCMP Group for an undisclosed price. (English article; Chinese article) That marks a shift from earlier reports, which had indicated that Alibaba founder Jack Ma would personally buy a minority interest to avoid the sensitive issue of mainland Chinese ownership of a Hong Kong newspaper. There’s no more detail on the actual transaction, though one report estimates the purchase will cost Alibaba around $100 million. Read Full Post…
The following press releases and media reports about Chinese companies were carried on December 12-14. To view a full article or story, click on the link next to the headline.
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Alibaba (NYSE: BABA) Buying South China Morning Post, Aiming to Influence Media (English article)
