CAIXINMEDIA

The Internet In China, A Very Different Kind Of Opportunity

Chinese Internet giant Tencent's HQ in Shenzhen, China
Chinese Internet giant Tencent's HQ in Shenzhen, China
Wu Xiaobo

BEIJING â€" If one were to think of the Internet as a person with flesh, blood and a soul, then what would be the source of its soul? The answer will be a very different one depending on which country's Internet we are talking about.

In the United States, a Time magazine article explored the idea that what shaped today’s personal computer and the Internet is the spirit of the hippies of the 1960s. The American generation born after World War II, bored with their rich but mediocre lifestyle, occupied universities and advocated sexual liberation, with rock music as its soundtrack. Though the movement was bound to end with the arrival of the oil embargo in 1973, the hippy spirit lingered on in music, films and art. And inevitably, the engineers who'd smoked marijuana carried it into the information revolution. They aspired to break the mechanical kingdom with an innovative technology culture that is freer than the one built by the likes of Henry Ford.

From Apple to Tencent

From Steve Jobs and Jerry Yang to Jeff Bezos and Mark Zuckerberg, whether they are native Americans or children of immigrants, all have hippy blood flowing in them â€" dropouts, revolutionary, liberal, never evil. Or at least that's what they've always said, and what Americans came to believe.

Totally distinct from the United States, when the Internet was introduced into China, the Chinese society was at the point of transforming into an extremely secular commercial version of the past. After the idealism and passion that accompanied social changes in the 1980s, the arrival of the Internet meant that all such faith in freedom was quickly extinguished. Young people stopped paying attention to politics. The vast majority of China’s elite pursued business opportunities. Money became the only criterion to measure success and social value. In such a context, the wizard-like arrival of the Internet was regarded solely as a handy tool for the pursuit of wealth and commercial development.

Venture capital, as well as the Nasdaq stock market, intensified the commercial nature of China’s online world. Internet companies were the first Chinese enterprises to be accredited by the international capital markets. From the day they were born, companies such as Sina, the largest Chinese-language web portal, and Sohu, a search engine, were the darlings of venture capital, soon to be publicly traded on the stock market.

Two young digital startup mavens were quickly ranked among China’s wealthiest persons: William Ding at 32 years old, founder and CEO of NetEase, a leading Chinese Internet content provider; and Chen Tianqiao, at 31, known for his keen flair for online games. While real estate was where the largest number of China’s richest came from, it was often suspect, while money made from the Internet enjoyed a far more positive image of being “wealth under the light of day.”

China’s technology world is regarded by many as simply following in the footsteps of the Silicon Valley â€" and indeed, so many Chinese Internet firms are clones of American prototypes.

Nevertheless, the ones that succeed eventually almost all find completely different survival and profit models from their models. Such has been the case with QQ, a clone of ICQ, the first popular instant messaging computer program, and WeChat, an instant messaging application for mobile devices and a clone of Kik Messenger. Whereas hardly anybody hears about Kik anymore, Tencent’s success today has largely been thanks to WeChat, which has become China’s most popular mobile app.

Consumer behavior

Thus, in the end, China has found its own way on the Internet, bound to best understand Chinese consumers’ behavior. The case of Tencent is a perfect example of the differences in terms of buying habits. For instance, Americans are willing to pay for a song for their own personal enjoyment, whereas Chinese people are more likely to buy it for their friends to listen to. Already in 2011, a study showed that Chinese had surpassed Americans in the volume of use of social media: more eager to share, more willing to buy virtual goods, and overall more enthusiastic about making online purchases. As of 2014, China’s online shopping business was already 4% bigger â€" in total retail sales of consumer goods â€" than America's.

Perhaps even more important, the closed dealings of China’s financial sector forced Internet companies to reach their break-even point more quickly. Taken together, all this means that both in terms of the absolute number of Internet users and in institutional innovation, China has become a more exciting business market than America. Today, the achievements of Chinese Internet companies are beginning to surpass that of their U.S. counterparts.

If the Americans are always thinking about how to change the world, the Chinese tend to think about how to adapt to the changing world â€" and about how to change their lives. This is a concept driven by business value. More broadly speaking, therein lies a fundamental difference of life philosophy and business approach between the Chinese and the Americans.

China has so far remained an atypical modern state. The government controls almost unlimited resources while the huge state-owned capital groups hover upstream of industries and participate in policy formulation. Internet companies are a rare and sunny exception. Due to the new technology's rapid evolution and the uncertainty of resources, the government and the state-owned enterprises have so far failed to effectively take control of it.

The Internet has brought China unexpected commercial progress and surprising space for freedom. But at the same time, it carries with it new sources for confusion and ever trickier regulation that could stymie innovation. This is obviously just the beginning, and it's anybody's guess how it will play out.

China’s Internet is a market independent from the rest of the world. Google, which refused to be tamed, was expelled. Despite his efforts at speaking Chinese, Zuckerberg’s Facebook is still shut out. Meanwhile, Ma Huateng of Tencent and Jack Ma of Alibaba have become world-class entrepreneurs. The public responsibilities that come with this particular kind of success is a whole new code for them to learn.

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Queen Elizabeth II with UK PM Boris Johnson at a reception at Windsor Castle yesterday

Anne-Sophie Goninet, Jane Herbelin and Bertrand Hauger

👋 Hej!*

Welcome to Wednesday, where chaos hits Syria, Brazilian president Jair Bolsonaro is accused of crimes against humanity and a social media giant plans to rebrand itself. For Spanish daily La Razon, reporter Paco Rodríguez takes us to the devastated town of Belchite, where visitors are reporting paranormal phenomenons.

[*Danish]

🌎  7 THINGS TO KNOW RIGHT NOW

• Syrian violence erupts: Army shelling on residential areas of the rebel-held region of northwestern Syria killed 13 people, with school children among the victims. The attack occurred shortly after a bombing killed at least 14 military personnel in Damascus. In central Syria, a blast inside an ammunition depot kills five soldiers.

• Renewed Ethiopia air raids on capital of embattled Tigray region: Ethiopian federal government forces have launched its second air strike this week on the capital of the northern Tigray. The air raids mark a sharp escalation in the near-year-old conflict between the government forces and the Tigrayan People's Liberation Front (TPLF) that killed thousands and displaced over 2 million people.

• Bolsonaro accused of crimes against humanity: A leaked draft government report concludes that Brazilian President Jair Bolsonaro should be charged with crimes against humanity, forging documents and incitement to crime, following his handling of the country's COVID-19 pandemic. The report blames Bolsonaro's administration for more than half of Brazil's 600,000 coronavirus deaths.

• Kidnappers in Haiti demand $17 million to free a missionary group: A Haitian gang that kidnapped 17 members of a Christian aid group, including five children, demanded $1million ransom per person. Most of those being held are Americans; one is Canadian.

• Putin bows out of COP26 in Glasgow: Russian President Vladimir Putin will not fly to Glasgow to attend the COP26 climate summit. A setback for host Britain's hopes of getting support from major powers for a more radical plan to tackle climate change.

• Queen Elizabeth II cancels trip over health concerns: The 95-year-old British monarch has cancelled a visit to Northern Ireland after she was advised by her doctors to rest for the next few days. Buckingham Palace assured the queen, who attended public events yesterday, was "in good spirits."

• A new name for Facebook? According to a report by The Verge website, Mark Zuckerberg's social media giant is planning on changing the company's name next week, to reflect its focus on building the "metaverse," a virtual reality version of the internet.

🗞️  FRONT PAGE

"Oil price rise causes earthquake," titles Portuguese daily Jornal I as surging demand coupled with supply shortage have driven oil prices to seven-year highs at more than $80 per barrel.

#️⃣  BY THE NUMBERS

98

For the first time women judges have been appointed to Egypt's State Council, one of the country's main judicial bodies. The council's chief judge, Mohammed Hossam el-Din, welcomed the 98 new judges in a celebratory event in Cairo. Since its inception in 1946, the State Council has been exclusively male and until now actively rejected female applicants.

📰  STORY OF THE DAY

Spanish civil war town now a paranormal attraction

Ghosts from Spain's murderous 1930s civil war are said to roam the ruins of Belchite outside Zaragoza. Tourists are intrigued and can book a special visit to the town, reports Paco Rodríguez in Madrid-based daily La Razon.

🏚️ Between August 24 and September 6, 1937, during the Spanish Civil War, more than 5,000 people died in 14 days of intense fighting in Belchite in north-eastern Spain, and the town was flattened. The fighting began on the outskirts and ended in house-to-house fighting. Almost half the town's 3,100 residents died in the struggle. The war annihilated centuries of village history. The town was never rebuilt, though a Pueblo Nuevo (or new town) was built by the old one.

😱 Belchite became an open-air museum of the horror of the civil war of 1936-39, which left 300,000 dead and wounds that have yet to heal or, for some today, mustn't. For many locals, the battle of Belchite has yet to end, judging by reports of paranormal incidents. Some insist they have heard the screams of falling soldiers, while others say the Count of Belchite wanders the streets, unable to find a resting place after his corpse was exhumed.

🎟️ Ordinary visitors have encountered unusual situations. Currently, you can only visit Belchite at set times every day, with prior booking. More daring visitors can also visit at 10 p.m. on weekends. Your ticket does not include a guaranteed paranormal experience, but many visitors insist strange things have happened to them. These include sudden changes of temperature or the strange feeling of being observed from a street corner or a window. Furthermore, such phenomena increase as evening falls, as if night brought the devastated town to life.

➡️ Read more on Worldcrunch.com

📣 VERBATIM

We still cling to the past because back then we had security, which is the main thing that's missing in Libya today.

— Fethi al-Ahmar, an engineer living in the Libyan desert town Bani Walid, told AFP, as the country today marks the 10-year anniversary of the death of dictator Muammar Gaddafi. The leader who had reigned for 42 years over Libya was toppled in a revolt inspired by the Arab Spring uprisings and later killed by rebels. Some hope the presidential elections set in December can help the country turn the page on a decade of chaos and instability.

🇮🇷🎓  IN OTHER NEWS

Iran to offer Master's and PhD in morality enforcement

Iran will create new "master's and doctorate" programs to train state morality agents checking on people's public conduct and attire, according to several Persian-language news sources.

Mehran Samadi, a senior official of the Headquarters to Enjoin Virtues and Proscribe Vices (Amr-e be ma'ruf va nahy az monkar) said "anyone who wants to enjoin virtues must have the knowledge," the London-based broadcaster Iran International reported, citing reports from Iran.

The morality patrols, in force since the 1979 revolution, tend to focus mostly on young people and women, particularly the public appearance for the latter. Loose headscarves will send women straight to a police station, often in humiliating conditions. Five years ago, the regime announced a new force of some 7,000 additional agents checking on women's hijabs and other standards of dress and behavior.

Last week, for example, Tehran police revealed that they had "disciplined" agents who had been filmed forcefully shoving a girl into a van. Such incidents may increase under the new, conservative president, Ibrahim Raisi.

Speaking about the new academic discipline, Samadi said morals go "much further than headscarves and modesty," and those earning graduate degrees would teach agents "what the priorities are."

Iran's Islamic regime, under the guidance of Shia jurists, continuously fine tunes notions of "proper" conduct — and calibrates its own, interventionist authority. More recently the traffic police chief said women were not allowed to ride motorbikes, and "would be stopped," Prague-based Radio Farda reported.

Days before, a cleric in the holy city of Qom in central Iran insisted that people must be vaccinated by a medic of the same sex "as often as possible," and if not, there should be no pictures of mixed-sex vaccinations.

✍️ Newsletter by Anne-Sophie Goninet, Jane Herbelin and Bertrand Hauger

Thoughts on Facebook's new name? Zuckerverse? Tell us how the news look in your corner of the world: Drop us a note at info@worldcrunch.com!

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Sign up to our expressly international daily newsletter!
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