China’s technology industry enters a new year after weathering unprecedented turbulence in 2019, when giants emerged in social media and artificial intelligence only to bear the brunt of Washington’s campaign to contain the world’s second largest economy. There’s little reason to think 2020 will be much different given US efforts to hobble Chinese champions from Huawei Technologies to SenseTime Group deemed a threat to national security.
Foremost among them were smartphone and networking titan Huawei and ByteDance, the Chinese wunderkind that in the span of a few years overturned social media entertainment and drew a billion-plus mostly younger users to its online video app TikTok. The heightened scrutiny came just as pressure back home intensified. Beijing sought to scrub sensitive content from ByteDance apps and Tencent’s WeChat, while the economy grew at its slowest pace in decades, depressing Alibaba Group’s e-commerce business. Investors cooled on the sector with venture capital activity halving triggering fears the industry’s heyday is over.
That in turn demoralised the country’s already-overworked tech professionals, who rebelled for the first time against the 70-plus hour workweeks that Alibaba-founder Jack Ma labelled the norm. Given Washington’s increasing hostility, China is now even more driven to devise alternatives to foreign technology from AI chips to blockchain solutions while propping up local champions: bad news for the likes of Qualcomm and Apple that depend on China for much of their revenue. It’s started to upend a decades-old supply chain centred on China, threatening to split the old world order in two. It’s not just in hardware — from Russia to Southeast Asia, many governments have begun to co-opt characteristics of the Chinese Internet arena, from harsh fake-news laws to censorship and data sovereignty.
SOURCE: VANGUARD NG