Business

Tencent quietly overcomes China’s technological turmoil

It was a disastrous year for China’s Big Tech, but it was, as always, a business for China’s most valuable tech company, its founder, and now China’s second-richest man.

$ 730 billion social networking and gaming giant Tencent and 49-year-old CEO Pony Ma are critical when Alibaba, Ant Group and Meituan face serious business and market questions from regulators. Avoided public criticism. power.

Tencent is unlikely to escape unharmed, but Ma’s low profile and close attention to government relations are under negotiation, according to officials quietly summarizing the proceedings against the music business. The company is in a good position.

“Keeping quiet will help you make your fortune,” said two Tencent employees, citing the golden rules for Chinese entrepreneurs popularized by former Communist Party leader Jiang Zemin. I did.

In contrast, his candid former rival Jack Ma has been seen almost publicly since regulators stopped the $ 37 billion initial public offering of his fintech company Ant Group last year. Is not …

“Pony is what the government wants tech executives to do. He’s unobtrusive and generally in line with government plans,” he said. “He is the opposite of Jack Ma.”

The group’s music department is likely to be fined heavily this summer after the Communist Party’s 100th anniversary celebration is over, according to two technical officials in Tencent-based Guangdong.

Regulators are likely to fine for antitrust violations at Tencent Music, a US-listed music streaming service that occupies about two-thirds of China’s online music market and was spun off in 2018. Officials said. Tencent refused to comment on possible fines.

Officials are still working behind the scenes as to whether Tencent needs to waive some of its exclusive music rights with the world’s largest record label or sell music apps. He added that he was negotiating with.

“Tencent penalizes. They have to show loyalty and make nice gestures. [for Beijing].. It all depends on Beijing — the local government does not have enough power to help, ”said a Guangdong province official.

However, Tencent’s core business, video games and superappli WeChat faced regulatory pressure, even though WeChat has become an important social media and messaging platform commonly referred to as a “utility”. Not believed to be.

Over the years, Ma has demonstrated its keen ability to sense climate change towards the technology sector.

At this year’s China Annual Legislative Assembly, Ma, who has been representing the National People’s Congress since 2013, called for tighter regulation of the Internet business and provided a high level of support for current government campaigns.

The company handles numerous requests from various government departments for censorship and oversight on messaging platforms.

In January 2000, WeChat censored hundreds of new keyboards related to. Covid Government Treatment.. It passes the information has led to the arrest and punishment – especially Xi Jinping President “steamed bread” and he called the men was sentenced to imprisonment by.

To increase surveillance, Tencent has developed an algorithm that better censors images. “Government needs WeChat — they depend on each other,” said one employee.

Tencent also provided cloud computing services to the government as part of driving the development of China’s “smart city,” whose engineers worked on apps to help Covid-19 respond.

As other Chinese tech executives move away from day-to-day management, Zhang Yiming of ByteDance and Colin Huang of e-commerce group Pinduoduo, who own the video platform TikTok, are in their 23rd year at the top of Tencent.

According to a certified book on Tencent’s history by journalist Wu Xiaobo, he was born into a middle-class family on the southern island of Hainan, began writing code at college, and soon became a “master of computer virus making.” I did.

“I’m a typical computer programmer,” Ma told the Chinese media. “Even my parents didn’t expect a geek like me to start a company.”

According to his own explanation, he is “not very sociable” and “not good at speaking”. He rarely interviews, speaks, publishes or posts on social media.

However, under his leadership, Tencent has increased its earnings 24 times over the last decade, funding 160 start-ups last year and becoming the most active investor in China. The initial public offering investment alone at the end of March was RMB14 trillion ($ 216 billion), more than a quarter of the market capitalization.

It has invested in Chinese startups such as food delivery group Meituan and e-commerce giant Pinduoduo, and has acquired shares in up-and-coming overseas technology and gaming companies such as Snap, Riot Games and Epic Games.

Tencent has also invested in a venture capital group Son started Of China’s top financial officials while receiving investment from the group for Tencent Music.

The prolific deal has also been in conflict with antitrust regulators who have fined the company several times in recent months for not seeking approval for past acquisitions. “We are actively working with regulators,” Ma said. .. .. Includes organizing some of these past investments. “

Elsewhere, Ma has kept Tencent away from pushing the boundaries of technology and finance. While Jack Ma’s Ant Group has grown to become China’s largest consumer lender, Tencent has fallen behind. And a few months before Ant Group’s IPO was cancelled, Pony Ma submitted his resignation on behalf of Tencent’s mobile payments platform Tenpay.

“Financial core beliefs are stability and health. Who lives longer, not who runs faster in the short term,” said Pony during a 2017 session when regulators scrutinized financial risks. Ma said. Ant is currently facing a “correction” campaign set up to shrink its business while Tencent is testing consumer loan products like credit cards.

The company’s biggest public relations challenge to date came four years ago, after parents and state media began complaining that Tencent’s gaming business was causing addiction to children. The campaign has suspended the government for almost a year with new game licenses.

Within a day of People’s Daily’s first critical editorial on Tencent’s gaming business, the company announced that it would set a time limit for children’s use, more than two years before the government’s edict arrived. Became the first group in China. Force them to follow the rest of the sector.

Since then, Ma has been “very focused and detailed” in addressing this issue, sending emails to the child protection team at least twice early in the morning to give advice and encouragement, team members said. Told.

Report by Nian Liu, Yuan Yang, Ryan McMorrow, Sun Yu

Tencent quietly overcomes China’s technological turmoil

Source link Tencent quietly overcomes China’s technological turmoil

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