Monday Tech Briefing: Qualcomm, Alibaba, P2P
BIG TECH COMPANIES
1. Embattled Qualcomm Catches Antitrust Break in Taiwan
What: Taiwan sharply reduced a fine against Qualcomm Inc. for anti-competitive behavior in exchange for future investment, in a rare positive development for the embattled telecom chip giant in Asia. The fine was reduced from $774 million to $89 million.
Why it’s important: U.S.-based Qualcomm has been under assault in Asia’s major chip-making markets of South Korea and Greater China for previous licensing practices that many of its customers complained were overly burdensome and anti-competitive. It also received a major setback last month when its plan for a major acquisition collapsed after Beijing failed to approve the deal nearly two years after it was first announced. (Source: Caixin)
2. Airbnb Scraps Promotion Over Cultural Objections
What: Shared-economy homestay specialist Airbnb has abruptly canceled a promotion that would have given winners of a competition free overnight stays on the Great Wall, one of China’s most recognized symbols.
Why it’s important: The promotion was supposed to be part of a bigger worldwide series that involved stays at more than 70 world-class tourist destinations. The decision to scrap the promotion was made after receiving feedback from an unspecified cultural heritage body, according to a post (link in Chinese) on its microblog.
Big picture: The about-face highlights sensitivities in China surrounding cultural matters in a country that boasts one of the world’s oldest civilizations but where many cultural artifacts remain poorly preserved. It also spotlights sensitivities about the commercialization of well-known cultural relics like the Great Wall. (Source: Caixin)
3. Alibaba Rolls Out VIP Package Resembling Amazon Prime
What: Tech giant Alibaba is “rolling out a new paid membership package that will give members benefits across its ecosystem of services as it looks to gain market share in digital entertainment and food delivery. Called ‘88 VIP,’ users pay an annual fee of 888 yuan ($129) to purchase a package that entitles them to a year of benefits, such as access to Youku Tudou, a subscription to Alibaba’s music platform Xiami as well as discounts on its food delivery platform Ele.me and e-commerce sites Taobao Marketplace and Tmall.”
Why it’s important: Alibaba’s new VIP package looks a lot like Amazon Prime in the U.S. “The move comes as Alibaba seeks to gain a larger market share in platforms with Ele.me, and with its digital entertainment offerings, at a time when Chinese users are more inclined to pay for content and services thanks to rising affluence and ease of mobile payments, with apps such as Tencent Holdings’ WeChat Pay and Alibaba-affiliated Alipay.” (Source: SCMP)
4. China Unicom Cuts International Roaming Fees By as Much as 97%
What: China Unicom announced that starting from Aug. 10 it would significantly reduce roaming charges for both voice and data services outside of the Chinese mainland. The tariff adjustments involved 143 countries and regions, and with an average price reduction of 46%, and a cut of as much as 97% in some areas.
Why it’s important: This is China Unicom’s most significant reduction of international roaming charges in the company’s history. The move comes amid government calls for China’s three big telecom companies to change their roaming charge policies. (Source: China Unicom, link in Chinese)
5. China Sets Target of 6 Trillion Yuan in Information Services Consumption by 2020
What: The Chinese government will aim for the scale of “information consumption” – the consumption of information-related services – in the country to reach 6 trillion yuan by 2020, according to a three-year action plan released by the Ministry of Industry and Information Technology and the National Development.
The plan also proposed that the country’s information industry would grow at an average rate of 11% per year, driving output of related fields to 15 trillion yuan.
Big picture: China’s information consumption continues to grow, with the government hoping to drive domestic demand by expanding and upgrading this innovation-driven sector. (Source: Caixin, link in Chinese)
6. China Proposes 10 Measures to Fight Rising P2P Risks
What: “Chinese authorities are rolling out 10 measures to curb rising risks caused by the troubled peer-to-peer (P2P) lending sector that has led to several protests in recent weeks.”
Why it’s important: “Since June, 243 online lending platforms have gone bust amid an intensifying crackdown on shadow banking, part of a broader campaign to reduce risks in the financial system. Many investors across the country hit the street to protest, demanding the government help them recover investments lost on failed platforms.”
Big picture: “The size of China’s P2P industry is far larger than in the rest of the world combined, with outstanding loans of 1.49 trillion yuan ($217.96 billion), according to data tracker p2p001.com.” (Source: Reuters)
Compiled by Isabelle Li
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