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China’s competition watchdog today came up with its most detailed list to date of abuses it intends to curb, sending shares of a wide range of tech companies lower.
Hours before the release of its latest quarterly earnings, shares in messaging and gaming company Tencent closed down 4.1 per cent, while ecommerce groups JD.com and Alibaba fell 5.2 and 4.8 per cent respectively.
The State Administration for Market Regulation released draft rules, which one analyst described as the “ultimate collection” of bad practices, reports Christian Shepherd in Beijing. “It’s a very long list of behaviours, many of which are rampant,” said Kendra Schaefer of the Trivium consultancy.
They include exploiting users’ data to put them off competitors’ products or services, limiting traffic to other platforms by practices such as blocking hyperlinks, false advertising, fraudulent online reviews and consumer privacy abuses.
The new rules, which could come into force later this year, come after the Chinese Communist party made antitrust regulation central to a broad campaign to limit behaviour by internet groups that it considers damaging to social stability and national security.
The prospect of a new data security law and expanded protection for personal information is already leading to changes in the funding ecosystem for Chinese tech, with US IPOs no longer being pursued following ride-hailing group Didi Chuxing’s difficulties with the authorities.
For the past three years, dollar funding accounted for about 70 per cent of Chinese internet start-ups’ total fundraising haul, with the remainder raising renminbi. In July and August, as regulators kicked off investigations into Didi and halted US IPOs, that flipped so renminbi accounted for 70 per cent of internet start-ups’ investment haul and dollars accounted for 30 per cent, according to Pedata.cn.
The Internet of (Five) Things
1. JET chief rejects activists’ urgings
Just Eat Takeaway.com’s chief executive told reporters on Tuesday he did not agree with activist shareholders who are pressing for the food delivery group to divest assets or explore a merger with a larger rival. Jitse Groen said divisions in Canada, Australia and Latin America were “very profitable” while combining with a heavily lossmaking rival would not make sense.
2. WhatsApp blocks Taliban
The Facebook-owned messaging service has shut down a complaints helpline set up by the Taliban after coming under pressure to block the group from using its services. The complaints number was supposed to act as an emergency hotline for civilians to report violence, looting or other problems in Kabul. Facebook said it had blocked the number on Tuesday, along with other “official Taliban channels”.
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3. Insurers using AI to reshape the industry
New technology is allowing insurers to produce individualised profiles of customer risk, but researchers worry that it could make it impossible for some people to find coverage. Meanwhile, the season finale of our Tech Tonic podcast dives into military use of artificial intelligence and how the debates over autonomous weapons are unfolding.
4. BT gets new chair
Adam Crozier, the former ITV and Football Association chief executive, is to take over as chair of BT at the end of the year as the UK’s largest telecoms group awaits the next move by acquisitive billionaire Patrick Drahi, who became the company’s largest shareholder in June. Fathoming the aims of Drahi should be close to the top of Crozier’s to-do list, says Lex.
5. Video games at 50
Commercial video games are now a half-century old, writes Leo Lewis. “Golden ages” have been variously declared at different points but, while business clearly has been boosted by the pandemic, and the capacity to surprise and delight remains infinite, it is not obvious that we are in one now, he says,
Tech tools — Google’s Pixel 5a
Ahead of the introduction of its flagship Pixel 6 smartphones this autumn, Google today announced the Pixel 5a, which it is hard to get excited about given the major advances promised in the 6. Indeed, The Verge describes it as a “boring update by comparison”, adding “The screen is a bit bigger this time around, there’s an IP rating for water resistance, and the battery gets a decent boost. That’s about it.” At $449 though, it is $50 cheaper than its 5G predecessor, the 4a, on its introduction. Google says the 5a will be available from August 26 in just the US and Japan.
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