China forbidding anonymous online posts

China’s crackdown on Internet freedom is getting even more intense. Last Friday, the country’s top Internet censor announced a new set of regulations meant to eliminate posts by anonymous users on Internet forums and other platforms. The Cyberspace Administration of China will start enforcing those rules on Oct. 1.

According to the new regulations, Internet companies and service providers are responsible for requesting and verifying real names from users when they register and must immediately report illegal content to the authorities. Tech firms, including Baidu, Alibaba and Tencent, are under more pressure to serve as the government’s gatekeepers as China prepares for the 19th National Congress of the Communist Party this fall, which is expected to place new people in several key leadership positions.

Furthermore, a new cybersecurity law that went into effect at the beginning of June requires tech companies to store important data on servers within China. While this is supposedly meant to protect sensitive information, it can also make it easier for the government to track and persecute Internet users.

Along with announcing its new regulations about anonymous posts on Friday, the CAC also specified what content is forbidden from being published online (link and translation via Google Translate), citing a passage from a bill that was passed in 2000 to regulate Internet information services in China. The list is so broad that it can cover almost anything:

Article 15 of the Measures for the Administration of Internet Information Services stipulates that Internet information service providers shall not make, reproduce, publish or disseminate information containing the following: (1) opposing the basic principles as defined in the Constitution; (2) endangering national security (3) to damage national honor and interests; (4) to incite national hatred, ethnic discrimination and undermine national unity; (v) to undermine national religious policies and to promote cults and (6) spreading rumors, disrupting social order and destroying social stability; (7) spreading pornography, pornography, gambling, violence, murder, terror or abetting a crime; (8) insulting or slandering others and infringing upon others (9) Any other content that is prohibited by laws and administrative regulations.

While China has issued various rules requiring online real-name registration for years, the CAC’s new regulations are another sign that the government is becoming increasingly stringent about censorship. For example, using VPNs to access blocked sites like Facebook and Twitter was relatively easy until earlier this year when the government began a crackdown that many observers believe is much more serious than previous attempts to enforce the ban.

As The Diplomat notes, China is taking a multi-pronged approach as it doubles down on censorship, placing more pressure on international publishers as well.

Source: TechCrunch

Alibaba leads $1.1B investment in Indonesia-based e-commerce firm Tokopedia

Alibaba has continued its push into Southeast Asia after it led a $1.1 billion investment in Tokopedia, an e-commerce firm based in Indonesia.

A valuation for the deal was not announced, but the companies did say that Alibaba has become a minority shareholder.

Tokopedia, which was founded in 2009, operates a marketplace that allows small retailers and large brands to sell to consumers in Indonesia, which is Southeast Asia’s largest economy. The company previously raised $100 million from SoftBank and Sequoia in 2014, and it counts East Ventures, CyberAgent and Beenos Partners among its early backers. Tokopedia said a number of undisclosed existing investors also took part in this newest round.

“The partnership with Alibaba will enhance the scale and quality of Tokopedia’s offerings to its customers and make it easier for merchants and partners to do business across the archipelago and beyond,” the companies said in an announcement.

“We have always thought of Alibaba as our teacher and role model,” Tokopedia CEO and co-founder William Tanuwijaya said in a statement. “Today, we are excited to welcome them as a shareholder and we believe that our partnership will further accelerate Tokopedia’s mission, to democratize commerce through technology.”

There’s plenty at stake in Southeast Asia. A recent report co-authored by Google predicted that annual e-commerce spend in the region will jump from $5.5 billion in 2015 to $88 billion in 2025. It estimated that half of that revenue will come from Indonesia, which is the world’s fourth largest country.

Tokopedia had been heavily linked with an investment from China lately, with sources telling TechCrunch last month that it had held talks with both Alibaba and, a rival company backed by Tencent.

Alibaba announced another blockbuster quarter of business today, which included impressive growth from its overseas commerce businesses. The firm credit Lazada, the Southeast Asia-based marketplace it invested $2 billion in, for growing its international commerce revenue by 136 percent to 2.6 billion RMB ($389 million). While that is only a small portion of its total revenue of 50.2 billion CNY ($7.4 billion), Alibaba is clearly bullish on Southeast Asia and this Tokopedia investment reaffirms that.

The deal marks the second major investment in a startup from Indonesia in the past month. Expedia put $350 million into booking platform Traveloka in a deal that valued the startup at more than $1 billion. Earlier this year, Go-Jek agreed to a new $1.2 billion round led by Tencent. That deal hasn’t been announced but TechCrunch understands that it will be made official soon.

Source: TechCrunch

Xiaomi is world’s top wearable maker for first time as Fitbit sales slide

Xiaomi’s good run has continued after a research firm found that the Chinese firm has ranked top for sales of wearable devices worldwide for the first. Sales of Fitbit devices, meanwhile, plunged by 40 percent

Coming off the back of Xiaomi’s reentry into the world’s top five smartphone sellers, a new Strategy Analytics report found that it leapfrogged Apple and Fitbit to become the top seller of wearables in Q2 2017 with 3.7 million units shipped. Fitbit logged 3.4 million shipments during the quarter with Apple coming in at 2.8 million — the U.S. firm actually posted higher sales growth than Xiaomi. The rest of the field was responsible for a further 11.7 million units, or 54 percent of all wearables shipped during the quarter.

Xiaomi and Apple both grew their marketshare year-on-year (from 15 percent to 17 percent, and nine percent to 13 percent, respectively), but Fitbit’s share cratered from 29 percent to 16 percent.

Both Xiaomi and Apple take very different approaches to wearables. Xiaomi has a wide range of products that are priced competitively and feature heart-rate monitors and alerts — the Mi Band is priced as low as $14.99 in the U.S. — while the Apple Watch, at upwards of $269, is a more premium approach that’s packed with a fuller set of features. While they both stand for something at different ends of the market, Fitbit’s position is less certain.

“Fitbit is at risk of being trapped in a pincer movement between the low-end fitness bands sold by Xiaomi and the fitness-led, high-end smartwatches sold by Apple,” Strategy Analytics’ Neil Mawston said in a statement.

As for the other two, Strategy Analytics said reports that the next Apple Watch may include extended health tracking capabilities could help Apple reclaim the top spot. But for now its lack of health band options is what the firm believes is keeping Xiaomi ahead, the firm concluded.

Xiaomi has had a resurgent 2017 so far, bouncing back from two disappointing years in which it struggled to maintain once-explosive growth and missed sales targets. A push into offline retail in China and progress in India, where the company cracked $1 billion in revenue last year, have contributed to a more optimistic outlook this year, with CEO Lei Jun claiming it has reached “a major inflection point in its growth.”

The company said its phone sales were up 70 percent quarter-on-quarter in Q2 with 23 million sold in Q2. Now it is pushing on with its offline retail strategy and furthering its global expansion plan thanks to a $1 billion loan that was secured last month.

Source: TechCrunch

China’s Great Firewall – VPN crackdown

China says VPN crackdown aimed at ‘cleaning’ the internet

FILE PHOTO: A computer network cable is seen above a Chinese flag in this July 12, 2017 illustration photo.
REUTERS/Thomas White/Illustration/File Photo

Scaling China’s Great Firewall is getting a whole lot harder.

Beijing said in January it would restrict virtual private networks, or VPNs, and this month reportedly told the three big telecoms companies to block individuals’ access to them by early next year.

China’s regulator defended the crackdown on Tuesday, saying recent measures were part of an ongoing campaign aimed at “cleaning and standardizing” access to the internet.

“Our restrictions target service providers without licenses or operating illegally,” said Zhang Feng, spokesman for the Ministry of Industry and Information Technology, at a press conference.

“Law-abiding individuals and businesses won’t be affected,” he said.

China’s internet is tightly controlled by censors, who block access to services such as Google, Facebook and even the New York Times. To get around the firewall, many people use VPNs, which use encryption to disguise internet traffic.

Authorities are cracking down on local Chinese companies offering VPN services without registering properly with the authorities, said Charlie Smith of, a group that monitors internet censorship in the country.

“These companies largely offer cheap access to VPNs, so in that regard, Chinese are losing an affordable way to access internet freedom,” Smith said.

The ministry’s comments followed widespread reports of dozens of popular China-based VPNs being shut down, and the country’s largest internet provider telling corporate customers that VPNs can only be used to connect to a company’s overseas headquarters.

The moves mean it will become increasingly difficult to find a working VPN. Soon, only technically savvy people will be able to get around China’s Great Firewall, says Maya Wang, senior researcher with Human Rights Watch.

“All this means the difficulty of getting access to an uncensored, unmonitored internet is ever increasing,” she said.

Beijing acknowledges, however, that China can’t completely get rid of VPNs — certainly not for businesses.

“We have noticed the need for direct international connections by foreign trade companies and international businesses. They can apply for such services with approved providers,” Zhang said.

“This is one of the rare instances when the authorities admit to the necessity of VPNs,” said Smith.

The U.S. views China’s censorship as a barrier to trade, arguing in an annual report that China’s “extensive blocking of legitimate websites” imposes significant costs on suppliers and users of services and products.

“U.S. industry research has calculated that up to 3,000 sites in total are blocked, affecting billions of dollars in business, including communications, networking, news and other sites,” according to the report published by the Office of the United States Trade Representative.

China has tightened internet censorship across the board ahead of the Communist Party’s 19th Congress this fall, where a major senior leadership reshuffle is expected. A new cybersecurity law that took effect in June is expected to make it harder for foreign firms to operate in China.

— CNN’s Steven Jiang contributed to this report.

Source: CNNMoney (Hong Kong)

Amazon founder Jeff Bezos – briefly – becomes world’s richest man

The founder of Amazon, Jeff Bezos briefly overtook Microsoft’s Bill Gates to become the world’s richest person.

Bezos leapfrogged Gates, who has been the richest man on the planet since 2013, after a rise in the share price of Amazon ahead of its latest results due Thursday night.

According to a real-time billionaires index compiled by Forbes, the rise pushed the value of Bezos’s fortune to $91bn (£69bn) – compared with Gates’ wealth of $90bn. Their riches are calculated on the share prices of their respective companies and at the current values Bezos’s stake is twice as big as carmaker Ford.

But the Amazon share price fell back leaving Gates on top, but with less than $1bn separating them.

Bezos – born in Albuquerque, New Mexico, in 1964 – keeps a relatively low profile, but has used some of the wealth he has amassed to buy the Washington Post and invest in space travel through Blue Origin, a company he founded in 2000.

He began Amazon in 1994 when he sold books from his garage in Seattle before expanding into a huge range of other products and capturing the global rush to online shopping.

Amazon now accounts for 43% of everything sold online in the US and 64 million people have signed up for its Prime service – which gives access to free deliveries and video streaming. Amazon shares have soared this year – making the company worth more than $500bn.

At the start of 2017, Bezos was ranked fourth-richest in the world, behind Gates, the investor Warren Buffett and Amancio Ortega, who founded Inditex, the company behind retailer Zara.

The share price rally comes despite accusations by Donald Trump, during the US election campaign, that Amazon was “getting away with murder, tax-wise”. He said Bezos was using the Washington Post for “political influence”.

In January, Bezos pledged the full legal resources of his company to fight the travel ban instituted by the new US president against seven Muslim-majority nations.

Amazon floated on the stock market in 1997. Every year Bezos reprints the letter he sent to shareholders that year, insisting it is only Day 1 for the company and pledging to focus on the long-term and be the market leader.

He has not joined the club of billionaires who pledge to hand over the majority of fortunes to charity – started by Gates and his wife, along with Buffett – but recently tweeted to ask for philanthropic ideas to help in the short term, which he said was in contrast to his long-term approach to running the business.

“I want much of my philanthropic activity to be helping people in the here and now – short term – at the intersection of urgent need and lasting impact.”

Forbes started tracking billionaires in 1987 and Bezos is the seventh person to hold the title of the world’s richest person. In a report on his rise to the top of the rankings, Forbes said Bezos would not be at the top if Gates had not given so much of his wealth away and has calculated that Gates has been the richest person in the world for more than half the 30 years it had been watching the wealth of billionaires.

The closing share price of Amazon and Microsoft on Thursday will determine whether Bezos cements his position at the top of the league. Microsoft’s shares were down on Thursday.

Technology stocks have been outpacing the rest of the US stock market, but wobbled last month amid concerns that the sector might run of steam. Amazon and others then started to rally again. It remains to be seen whether Bezos is able to permanently claim the top slot.

Amazon has now expanded beyond retailing. It now sells cloud computing services to thousands of businesses ranging from Netflix to the UK’s ministry of justice. It also makes TV shows and the Echo smart speaker, which allows users to speak to Alexa, an electronic personal assistant.
Source: The Guardian

Alibaba and Tencent are carving up Southeast Asia’s startup ecosystem

Two global tech forces are putting their mark — and money — into Southeast Asia’s nascent startup ecosystem, but they may not be the Western names that you expect.

Rather than Google, Facebook or Microsoft, increasingly Chinese duo Alibaba and Tencent are the driving forces behind the importing of large sums of capital and vast business experience into Southeast Asia’s most promising startups.

Both companies, sworn enemies in China, appear to have realized the potential in the region and are now acting on it. That means battles, drama and probably more — welcome to Southeast Asia’s tech Game Of Thrones.

A market with promise

Southeast Asia has long been an area of interest for business for its neighbors. Tech aside, Southeast Asia is home to more than 600 million consumers, with six primary markets — Singapore, Indonesia, Thailand, Vietnam, Malaysia and the Philippines — standing out for growing economies and rising middle-classes of consumers.

In today’s digital era, smartphones have been a key catalyst. Like India, Southeast Asia’s internet users are primarily on mobile, with most having skipped the PC altogether and jumping straight to phones and tablets.

A much-cited report co-authored by Google last year showed that Southeast Asia has 260 million internet users with 3.8 million more going online per month. That’s tipped to grow the internet population to 480 million people by 2020. Sure, that isn’t China level yet — the country has 731 million internet users, half of which are mobile — but it does mean that, alongside India, Southeast Asia is a region of serious tech development potential.

That same Google report forecasted that the region’s ‘internet economy’ — i.e. all business generated from the web — will be worth $200 billion by 2025. That’s up from 6.5-fold from 2015, when it was estimated to be worth $31 billion. E-commerce alone is tipped to rise from $5.5 billion in 2015 to $88 billion in 2025, of which half will originate from Indonesia, the world’s fourth largest country, according to the report.

From interested to invested

Over the past year, it seems that Chinese companies have gone from scouting the region to actively owning chunks of it.

The first step was Alibaba’s $1 billion investment in Lazada, an Amazon-like e-commerce company serving six countries in Southeast Asia, in April 2016. The deal represented the first major investment into the region from a Chinese company.

Alibaba has since firmed up its shareholding, paying another $1 billion in June to take its ownership to 83 percent, while, under its tutelage, Lazada expanded its business into groceries with the acquisition of Singapore-based Redmart while it launched an Amazon Prime-style offering in partnership with Netflix and Uber. Amazon is expected to enter Southeast Asia this year, with sources telling TechCrunch an original goal of launching Q1 proved to be too ambitious.

Lazada CEO Max Bittner told TechCrunch last month that his company plans to extend both services, which are currently only available in Singapore, to different markets. Arguably, this is where Alibaba’s capital and experience is really coming into play for Lazada.

“We’re found the right balance between us having the freedom [for our business] and falling back on Alibaba as our big brother willing to help us when we need it,” Bittner said of the relationship in an interview.

Alibaba hasn’t stood still there, however. It has embarked on a series of fintech investments in Southeast Asia through Ant Financial, its financial services affiliate.

Ant Financial’s global investment spree has included a $1.2 billion deal for U.S.-headquartered Moneygram and Korea’s Kakao Pay, but in Southeast Asia it has done deals with Thailand-based Ascend Money, Mynt in the Philippines, Emtek in Indonesia, and Singapore’s M-Daq.

Then, earlier this month, Alibaba itself opened the coffers again to invest in a $50 million round for online insurance site Compare Asia Group.

Tencent, meanwhile, has a long-standing investment in Thailand-based media company Sanook, while it invested $19 million in a joint media venture with Ookbee, another Thai company. On the product-side, it has aggressively pushed its free-to-play music service Joox in Southeast Asia as a rival to Spotify, while it recently invested in U.S. karaoke app Smule which has strong traction in the region and plans to expand in Asia.

“Through their investments and acquisitions, it’s very clear that Alibaba and Tencent are interested in Southeast Asia. They share our vision, that this region is ripe for opportunities in the e-commerce, payments, and marketplaces space,” Vinnie Lauria, founding partner at Singapore-based VC firm Golden Gate Ventures, told TechCrunch in a statement.

Alibaba chairman Jack Ma has led his company to expand into India and Southeast Asia for growth opportunities

Pick a side

That collection of deals is just those that have been reported or made official. There are plenty more either lurking in a press pipeline waiting to be announced, or subject to negotiations.

Through discussions with founders, TechCrunch understands that Tencent and Alibaba have held discussions with at least a dozen startups that operate in Southeast Asia’s e-commerce or fintech space. In almost every instance, it seemed that both Chinese giants had been in touch with a near-identical set of companies to make investment offers, or to register interest for when the startup in question is ready to raise new funds.

To borrow a phrase from a prominent tech investor, who spoke to TechCrunch on the condition of anonymity to avoid offending either company, Tencent and Alibaba are “carving up” Southeast Asia’s startup ecosystem.

The dogfight has spilled into the ride-sharing space, for one.

Alibaba is expected to be part of a group of investors behind a new funding round for Uber rival Grab which could reach $2 billion and is expected to close soon, a source told TechCrunch. But Alibaba is also rumored to have held talks with Go-Jek, a rival to Grab and Uber which is widely acknowledged as the market leader in Indonesia. However, in a twist, Go-Jek ended up agreeing to take investment from Tencent as part of an as-yet-unannounced $1.2 billion round that would value the company at $3 billion, as we reported in May.

In e-commerce, Tencent’s strategic ally — which includes Tencent among its investor base — has been strongly linked with an investment in Indonesia-based company Tokopedia, which previously raised money from SoftBank. However, a source told TechCrunch that Alibaba is also talking to the company with a view to making an investment. Alibaba’s long-standing relationship with SoftBank, which included an early investment in Alibaba, could prove to be a clincher in this case.

The decision of Alibaba or Tencent is tough one because essentially companies are being asked to join one of two rival sides.

It’s akin to a Game Of Thrones-style allegiance. There are few examples in China of companies that share both Tencent and Alibaba as investors — both firms own stock in Didi by virtue of a merger between their respective investees, Didi Kuaidi and Didi Dache — so the decision of which to go with has real long-term implications on future relationships and investors.

“They are clearly drawing lines in the sand with their checkbooks, and we can see a war of these two titans playing out across Singapore, Indonesia, and Thailand,” Lauria, whose firm invested in Redmart, said.

First of many movers

While Alibaba and Tencent are among the first (and heaviest) movers, many are predicting that others from China and beyond will follow the same steps if they haven’t already.

“Singapore, serving as the hub for the Southeast Asia ecosystem, continues to attract major investment interest from Chinese companies and Chinese VCs,” Michael Smith, an operating partner with early-stage VC firm SeedPlus, told TechCrunch.

“Obviously Tencent and Alibaba are some of the biggest companies looking for growth in areas like e-commerce, fintech and logistics but is also investing and looking for further opportunities in the region,” he said.

Smith also pointed out that bike-sharing companies Mobike and Ofo both selected Singapore for their first overseas expansion, while, outside of the startup space, China-backed consortium Nesta is bidding to buy Singapore’s Global Logistic Properties for around $11 billion.

“We continue to believe that Singapore and the companies created here will rise in their attraction to not only Chinese but European and American companies looking for Asian expansion,” Smith said.

Uber rival Grab is close to taking investment from Alibaba, according to sources.

U.S. tech firms have increased their presence in Southeast Asia, with Google and Facebook in particular operating local offices in multiple countries, but their presence has centered around product localization, sales and marketing rather than investments.

Google acquired a chat messenger app to staff its ‘Next Billion’ team tasked with tweaking existing services and creating new ones for emerging markets like India, Southeast Asia and Africa. (It recently did the same in India, too.)

Facebook and Twitter are among those that have long conducted deep market research projects to learn more about how users in frontier markets use the internet. Facebook even trialled a social payment feature in Thailand to explore the potential of social media commerce.

The results of these exercises have helped shape products like Facebook Lite, the social network’s fastest-growing app, and Twitter’s new mobile web app, but for now none of the Western tech giants have dived into the ecosystem with quite the impact of their peers from China — and we’re just getting started.

Source: TechCrunch