Monday Tech Briefing: Jack Ma, Didi, Tariffs
BIG TECH COMPANIES
1. Alibaba's Jack Ma Names CEO Daniel Zhang as Successor
What: Alibaba said Monday that Executive Chairman Jack Ma will step down on Sept. 10, 2019, and hand over the position to CEO Daniel Zhang.
Why it’s important: In 2013, Ma stepped down as Alibaba’s CEO but retained the chairman’s position. He has continued to play an active role in the company, including overseeing its record-breaking $25 billion New York IPO in 2014.
Big picture: Ma founded Alibaba in the coastal city of Hangzhou in 1999, and since then has built the company into one of the world’s most valuable internet firms. He is one of China’s richest men, and among a group of internet celebrities who have become household names for most Chinese. (Source: Caixin)
2. Liu Qiangdong Must Appear in U.S. Court If Charged, Prosecutors Say
What: Chinese billionaire businessman Liu Qiangdong, accused of rape during a recent Minneapolis trip, will have to appear in a U.S. court if prosecutors decide to bring charges against him, the Hennepin County prosecutor’s office said.
Why it’s important: There has so far been no official disclosure of exactly what happened that led to Liu’s arrest except that he was detained on allegations of rape. Liu, who also goes by Richard Liu, denied any wrongdoing in connection with the arrest, and his lawyers said Monday that there is only “a very remote possibility” that charges will be filed against him.
Big picture: Liu, the 45-year-old CEO of U.S.-listed Chinese e-commerce giant JD.com, was arrested in Minnesota’s Hennepin County on suspicion of rape on Aug. 31 but was released the next day. Liu has since returned to Beijing. He was in Minneapolis — Minnesota’s largest city, which is in Hennepin County — attending a weeklong course at the University of Minnesota’s Carlson School of Management for its China business administration doctoral program. (Source: Caixin)
3. Didi Chuxing Discloses $585 Million Loss in First Half
What: “Didi Chuxing, China’s largest ride-hailing platform, has not made a profit in the six years since its founding and recorded a net loss of 4 billion yuan ($585 million) in the first half of the year, Didi founder and chief executive Cheng Wei disclosed in a letter to employees on Friday,” the South China Morning Post reported.
Why it’s important: “The voluntary disclosure offers a rare glimpse into the financial state of the privately held firm as it tries to shore up public confidence following the alleged rape and murder of a female passenger by one of its drivers, the second in three months.”
Cheng told employees in the letter: “Didi is by no means an evil company, and would never prioritize generating profit above anything else.” (Source: South China Morning Post)
4. China Launches First Court Focused on Internet-Related Cases
What: Beijing set up its first court on Sunday specializing in handling internet-related litigations, entirely online. The Beijing internet court will handle cases ranging from online intellectual property rights to e-commerce disputes.
Big picture: Beijing is the second city in China to set up such a court, after Hangzhou. Many major tech enterprises have headquarters in Beijing, including Baidu, JD.com and Tencent, and the number of internet-related cases handled by the city’s courts has grown in recent years. A total of 37,631 cases related to the internet were heard by Beijing’s regular courts from January to August of this year, a 24.48% increase from the same period last year. (Source: Caixin, link in Chinese)
5. Trump tells Apple to Make Products in U.S. to Avoid China Tariffs
What: “U.S. President Trump tweeted on Saturday that Apple Inc should make products inside the United States if it wants to avoid tariffs on Chinese imports,” Reuters reported. “The company told trade officials in a letter on Friday that the proposed tariffs would affect prices for a ‘wide range’ of Apple products, including its Watch, but it did not mention the iPhone.”
Why it’s important: Trump announced on Friday that his administration planned to impose increased tariffs on a new $267 billion worth of goods from China, escalating the ongoing trade conflict between China and the U.S. “The technology sector is among the biggest potential losers as tariffs would make imported computer parts more expensive. Apple’s AirPods headphones, some of its Beats headphones and its new HomePod smart speaker would also face levies.” (Source: Reuters)
6. US Tech Groups Seek Key Product Protections from China Tariffs
What: “Cisco, Dell, Hewlett Packard Enterprise and Juniper Networks have issued a last-ditch appeal to the Trump administration to protect key products from being included on a list of $200 billion in new tariffs on Chinese imports, amid growing anxiety in corporate America over the escalating trade war with Beijing,” the Financial Times reported.
Why it’s important: “The joint statement marks a departure from the approach taken by most large US companies, few of whose leaders have spoken out directly against the administration’s trade policy despite harboring concerns about its impact on their businesses.” (Source: Financial Times)
Compiled by Hou Qijiang and Qian Tong
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