Xi’s power on Bitcoin sees the rise of Alibaba’s new rival
China Roundup: Xi's power on bitcoin, the rise of Alibaba's new rival
It has dawned. The nemesis of the Alibaba rival is here to shake the ground and the whole of China’s internet landscape. This week saw e-commerce upstart Pinduoduo has displaced JD.com as it rages to be the fourth most valuable internet company in the country. With a market capitalization of $47.6 billion on Friday putting it just a few steps behind the country’s e-commerce leader Alibaba, social networking behemoth Tencent as well as food delivery titan Meituan in China. The search equivalent of Google in China, Baidu has fallen from the top three clubs, ending a decade of unshakable dominance of Baidu, Alibaba, and Tencent on the Chinese internet.
With growing internet penetration and the rise of social commerce, it starts the story of Pinduoduo. It is known for selling products that are ultra-cheap to residents popular with price-sensitive from small towns and rural regions that are underserved by online pioneers Alibaba and JD.com. By targeting more urban consumers, Pinduoduo is heavily subsidizing big-ticket items such as iPhones.
The messaging app owned by Pinduoduo investor Tencent is seamlessly integrated with WeChat contributing to adaptability among the less tech-savvy population. With easy access, WeChat users via the messenger Pinduoduo’s built-in lite app skips app downloads, get deals from group-buying pointing to the name Pinduoduo, meaning ‘shop more together’ in Chinese.
Colin Huang, a 39-year old former Google ENGINEER, gave a 45-minute speech at the company’s anniversary announcing that Pinduoduo has surpassed JD.com in gross merchandise volume, or total dollar value of goods sold. But it is still unclear as to whether the companies use the same set of metrics or GMV for instance, with figures includes refunded items.
Pinduoduo’s competition against Alibaba is more blatant while the rivalry with JD.com is nuanced as both the companies are backed by Tencent. Huang acknowledged Pinduoduo stands on a giants’ shoulder hinting the sheer size of Alibaba in his missive to staff. During the upcoming Single’s Day Shopping Festival, there comes fighting an impending battle whereas the founder sounded poised. Pinduoduo isn’t pressurized but our peer should be stated, Huang.
Put the facts straight
The statistics say it all, 82% of Chinese adults used digital payment, up by about 5%, amongst the rural, 72% made transactions via online banking, telephone banking, point of sale system, ATM or other digital channels, according to a new report released by People’s Bank of China. This includes the push for rural areas to go cash-free that’s giving rise to such flourishing e-commerce businesses as Pinduoduo.
Few things move Bitcoin market like President Xi Jinping’s endorsement of blockchain. In his politburo meeting, he called for China to take the blockchain technology as an important breakthrough thereby achieving independence of core technologies. As the Bitcoin price has soared more than 10% in response, industry experts cautioned that China, which had banned crypto exchanges earlier speaking of blockchain means the encrypted technology not only undergirds cryptocurrencies but can revolutionize a whole range of sectors like finance, agriculture, and manufacturing. This leads us to expect all corners of Chinese society to capitalize on the blockchain concept with greater force.
A prominent venture investor popular in China closed $352 million for the first fund of his new financial vehicle. JP Gan is a former managing partner at Qiming Venture Partners, who recently started Ince Capital Partners with the internet veteran and venture investor Steven Hu. Gan comes with sound knowledge in the industry with backing noted companies like Xiaomi, Meituan, Ctrip, Musical.ly and continually funding early to growth-stage startups in China’s internet, consumer and artificial intelligence sectors.
Hiring leading voice recognition expert, the Smartphone maker Xiaomi has taken a step ahead with Daniel Povey. He was part of the team which developed the widely used open-source speech recognition toolkit Kaldi while announcing his next move on Twitter. Earlier, Povey declined an offer from Facebook after being fired by John Hopkins University for attempting to break up a student sit-in. Talking to Baltimore Sun, he intended to join a Chinese company as they don’t have American style social justice warriors and feeling more relaxed among the Chinese. According to him, many Chinese companies have R&D operations in the US including Xiaomi that setup the US R&D center in 2017, deepening the collaboration with the chip-making giant Qualcomm.
The e-learning unit of NetEase, Youdao traded at $13.50 per ADS in the US amidst increased regulatory scrutiny on Chinese IPOs. It operates a suite of popular online educational products from dictionaries to MOOC-style courses with over 100 million monthly active users. NetEase founder Din Lei, once China’s richest man added momentum to his 22-year-old company. Nowadays, NetEase makes the bulk of its revenue from video games and ranks only behind Tencent in the booming gaming sector in China. It has sold its hopeful cross- border e-commerce business Kaola to Alibaba for $2 billion.