Major Chinese phone maker Oppo will treat Oppo and OnePlus as “dual-primary” brands, it was announced at an event to mark the 9th anniversary of OnePlus on Dec. 17. Oppo will invest RMB 10 billion ($1.43 billion) in OnePlus in the next three years as part of the new strategy, according to Liu Zuohu (Pete Lau), founder of OnePlus and chief product officer of Oppo.
Why it matters: Since the two firms merged in 2021, OnePlus’ positioning has become somewhat unclear – it offers a less premium experience compared to Oppo and has lost some of its unique features. The new strategy and investment seem intended as a strong push to make OnePlus stand out again.
Details: In addition to the $1.43 billion investment, Oppo will also share more resources in terms of technology, retail channels, and after-sales services with OnePlus.
Context: Liu founded OnePlus in 2013 after working at Oppo for 15 years. The two companies belong to BBK Electronics, with OnePlus manufacturing their phones in Oppo’s factories.
An intrinsic part of most people’s daily lives, the fashion industry also consumes a huge amount of resources. The industry is the second highest polluting industry, after petroleum. One cotton shirt usually requires 700 gallons of water to be produced, an amount sufficient for one person to drink for 3.5 years, according to Joann Cheng, Chairman and CEO of luxury fashion firm Lanvin Group.
To improve sustainability in the industry, efforts are needed at all levels – from supply chains to sale channels – and the importance of new business models can also help the transition.
Representatives from Lanvin Group, Fashion for Good, and Feiliu Tech shared insights on sustainability in the fashion industry and the approaches required to improve it at the BEYOND Expo 2022 sustainability conference, held online in the BEYOND Metaverse.
The text below features some of the highlights of the discussion and has been condensed and edited for clarity.
Joann Cheng, chairman and CEO of Lanvin Group
Sustainability is not just about fabric or some technology but about the supply chain.
When we talk about the supply chain, everybody talks about how to minimize costs to improve efficiency. But sustainability is not about reducing the cost. The key is to protect our environment and to get long-term protection. So we must think about new business models and challenge the old way of saving dollars by including more fashion pieces.
I think we have to change our current business model from the supply chain to the sales channel to get sustainability to the next level.
We challenge ourselves in an innovative way in how we sell. For example, there are a lot of platforms in the market now focusing on resales, repairs, or rentals. And some fashion pieces can be recycled. There are a lot of brands, like Allbirds, using a very sustainable fabric as a fundamental of the product. However, this is definitely a trade-off of profitability versus sustainability because getting there costs more money.
We also linked the design and the product to the sustainability concept. For example, Wolford is a brand in our group. It is the first to achieve the gold level of accreditation from Cradle to Cradle in this industry. This means our products are 100% disposable.
And we have designed a special capsule: Aurora uses a fabric that is totally not polluting to the environment and really 100% disposable. By pushing them to the market customers, we can really contribute our efforts to sustainability.
There still is a long road to go, but we have a long-term vision on ESG and sustainability and will take action going forward.
Priyanka Khanna, Asia Expansion Head, Fashion for Good
In my opinion, the industry dynamics need to change quite a lot. This buyer-seller relationship exists in the industry between the brand and the supplier. That dynamic needs to be changed into [something] more co-developed and co-created. And literally bringing on board with these suppliers and brands the technologies that would make this change happen.
We foresee that to transform this industry, to make it more circular and sustainable, you have to infuse technology into it. We are hoping to find these technologies, assessing whether they can actually work with a larger industry or industry as a whole, and we then support these technologies to scale with the existing players and hopefully with industry-wide integration in the future.
It’s multiple industries in the one fashion industry. It’s so large and so complicated in each supply chain step, from raw materials to processing, to actual manufacturing, and all the way to the end of use. There are multiple technology intervention areas that can potentially transform the industry’s footprint, reducing the usage of natural resources like water and overall carbon emissions, the pollution of water, etcetera.
To make that happen, we work with multiple [parties]. I think one of the most important is the manufacturers. They have to be brought on board and educated on everything happening because they are usually the final people to work with the innovations. Now we’ve looked at about 3,000 technologies, and we’re working with about 157 across the supply chain. We have brands supporting this initiative, partnering to assess which technologies can work and then supporting scaling them.
Kate Liu, Ph.D. Co-Founder and CPO of Feiliu Tech
In our opinion, most of the fashion industry’s impact is not only at the ground level but also at the production level at the supply chain side. It’s about the raw materials and the whole production process.
We are trying to bring a new concept of sustainable fashion into this very traditional area, especially the manufacturing side. When we talk about the supply chain issue, we talk about the factories and the workers in the [production] lines. They do a lot of work, such as sewing and cutting, for the process. And they usually need some technology to help them improve efficiency while doing all the processes.
Big orders with large quantities usually give you enough time to get familiar with procedures to make their work more effective. But for small companies and orders with a very short delivery time, you need a delicate plan to make a dynamic production process.
On the supply chain side, with AI’s help, the factory can have a brain to make decisions, so it’s not only on the technical person, the plant owner, or the team leader. It can also have all the data and collect the digitalization process from each station and each worker. Then AI can also analyze to make the workers more effective.
In this way, people can take small orders in small quantities. This flexible work can avoid overproduction and waste in the fashion industry, making the whole thing more sustainable.
]]>Chinese phone maker Oppo launched two new foldable phones – Find N2 and Find N2 Flip – for the Chinese market at a release event on Thursday. Available in three colors, the Find N2 has a price range of RMB 7,999 – RMB 8,999 ($1,147 – $1,290). The Find N2 Flip also comes in three colors and is priced from RMB 5,999 to RMB 6,999 ($860 – $1,004). The two models will initially be available only in China, with shipping starting on Dec. 23 for Find N2 and Dec. 30 for Find N2 Flip. Oppo confirmed to TechNode that the latter model would be introduced to overseas markets soon.
Why it matters: Oppo released its first foldable phone, Find N, last year, giving the brand a 4.6% market share (in Chinese) in the Chinese foldable market in the third quarter of 2022. This year, the firm focused on slimming down the weight of its next iteration. The new tablet-like Find N2 is even lighter than some regular phones, such as the iPhone 14 Pro Max.
Find N2: The Oppo Find N2 uses Qualcomm’s high-end processor Snapdragon 8+ Gen 1, which was introduced earlier this year but has now been superseded by the Gen 2.
Find N2 Flip: Oppo’s first flip-style foldable phone has a 3.26-inch rounded rectangular screen that the firm claims is the largest external screen of any phone in its class.
Context: The foldable phone market has seen strong growth both in China and overseas in the last year. Counterpoint Research projected that global foldable phone shipments will increase 77.8% yearly to 16 million units in 2022, and hit 26 million in 2023.
Chinese phone maker Oppo on Wednesday released its first smart health device, called OHealth H1. A small oval-shaped device that can take six key health measurements, OHealth H1 is targeted at family healthcare scenarios and daily monitoring use.
Why it matters: Oppo has been expanding its investment in digital health devices in recent years, hoping to diversify its offering and “use technological innovation to meet evolving healthcare needs,” according to a spokesperson.
Details: The OHealth H1 features six health data monitoring functions: blood oxygen, electrocardiogram, heart and lung auscultation, heart rate, body temperature, and sleep tracking.
Chinese phone maker Xiaomi unveiled its new Xiaomi 13 Series at a release event on Dec. 11, with camera systems from Leica and nine colors for the standard version and four for the Pro version. The new addition to the brand’s annually-updated flagship offering, the Xiaomi 13 series has a price range of RMB 3,999 to RMB 6,299 ($572.97 to $902.51).
Why it matters: Xiaomi’s flagship is a key indicator of the firm’s intention to appeal to a more premium market segment, with top-of-the-range specs and relatively affordable prices.
Details: The Xiaomi 13 series come with top specs in major areas, including a Qualcomm Snapdragon 8 Gen 2 chipset, a high-brightness display, and cameras with a large sensor.
Context: Xiaomi is the third-largest phone vendor globally by shipments in the third quarter, accounting for 14% of the market, according to hardware insight firm Canalys.
Chinese smartphone maker Vivo’s sub-brand iQOO announced its new flagship phone the iQOO 11 on Thursday. The phone, which will be available in certain markets across Southeast Asia for the first time, adopts Qualcomm’s latest high-end chipset Snapdragon 8 Gen 2.
Why it matters: The iQOO 11 introduces an innovative update to the adaptive refresh rate, supporting partial refresh to increase power efficiency.
Details: In addition to the Qualcomm chipset, the iQOO 11 offers high-spec storage and memory chips. The phone also adopts a new cooling system to maintain peak hardware performance when running games.
Context: Founded in 2019, iQOO focuses on gaming phones for the Chinese and Southeast Asian markets.
Phantom, a sub-brand of Chinese smartphone maker Tecno, released the X2, an update to its premium phone series, on Wednesday at a release event held in Dubai, United Arab Emirates. Tecno operates and serves in over 70 global markets. Transsion, Tecno’s parent firm, accounted for 48% of the African smartphone market in the second quarter of 2022, according to IDC, with Tecno alone taking 9.81% of the African smartphone market as of November.
Last year, Tecno relaunched its Phantom brand with a focus on the premium smartphone market amid an ambitious global expansion plan. The annual flagship, Phantom X2 5G, is the second generation of this brand and priced at 2,699 in South African Rands ($718) for all the first batches of available regions, including India, Nigeria, Kenya, Saudi Arabia, Colombia, Turkey, and the Philippines.
The phone has a decent body design and operating system, as well as long battery life. The device’s occasional inconsistent camera performance might undermine its ambition to compete with rivals’ high-spec flagship models.
The Phantom X2 5G adopts a dual-curved body design. The rounded edges and glass back make it a comfortable device to hold. The “Stardust Grey” color – a lightly shiny graphite shade – gives it a smart, low-key business look.
The frame on top has a mirror-like surface, while other parts are dull-polished to match the back case. The 6.8-inch punch-hole display looks frameless and is easy to control with one hand, considering its narrow width. And for a phone of this size, the X2 5 G’s weight is also acceptable – at 210.3 grams, slightly heavier than an iPhone 14 Pro.
The display performs well most of the time but can struggle when outdoors. Its peak brightness of 700 nits is not enough to see content in bright sunlight. There is an option in the settings that offer higher display brightness, but it consumes more power, and the phone might experience overheating.
The phone comes with the Android 12-based HiOS. The system runs smoothly and exceeds regular Android OS with rich built-in features and redesigned user interface.
The interface has a friendly color scheme and feels intuitive and accessible. The system provides a guide to help new users get familiar with the core features and system navigations.
There are also some well-designed widgets like Weather and To-dos. The negative home screen is replaced with a collection of widgets.
Another highlight is one can access Tecno’s purpose-built sidebar using the “back” swipe. It’s useful for accessing common functions and apps quickly, even if the default trigger is a bit too sensitive at times.
Built with MediaTek’s 2021-launched flagship chipset Dimensity 9000, the phone can cope easily with daily use and is well-equipped for most heavy workloads. We tested it with top gaming titles from Google Play, such as Apex Mobile, Asphalt 9, and Genshin Impact. Apex Mobile and Asphalt ran smoothly, but when we pushed it further by running demanding games like Genshin Impact, the phone experienced frame drops and overheating.
The phone offers only 8GB RAM, but what surprised us is that, even while playing games, the system manages to keep previously-opened apps running in the background.
For battery life and charging speed, the Phantom X2 5G is equipped with a large 5,160 mAh battery, meaning it can last all day with normal usage. But its 45-wattage charging speed falls well short of its premium market rivals, with other brands offering at least 60 W or even 200 W charging. With the charger coming in the box, it takes 90 minutes to fully charge from 20%. The phone also appears to use a private charging protocol, so when we connect it with a Power Delivery (PD) charger, the charging wattage is even lower.
The under-screen fingerprint recognition solution is appealing and easy to use, but it doesn’t always respond as quickly as expected, frustrating at times.
The Phantom X2 5G has a mixed camera performance. In some shooting scenarios, especially portrait mode, the results are stunning; yet the camera underperforms in full resolution mode, night mode, and can have some issues in color rendering.
The device has a triple camera system, with the main lens supporting a resolution of 64 million pixels. In regular mode, it can capture nice shots, but the full resolution – 64MP mode – is less ideal and pictures shot with this option can come out worse than ones taken in regular mode. The images do look larger than the low-resolution versions, but they would lack details.
The AI camera can recognize different scenarios most of the time, optimizing the images automatically. It can also combine different modes, for example, portraits with night or street view and HDR (high-dynamic range).
The night mode is a bit disappointing, with a long wait (around six seconds) and often a worse image result than the normal mode.
The camera also occasionally captures images with some color issues. Highlights and shadows sometimes come with color aberration. The issue saw a slight improvement after a system update.
The Phantom X2 5G is pricier than other mid-end phones. The nice design in the back case and frameless display make a great first impression. Its front camera, system UI, system optimization, and battery life all perform well, but its back cameras and charging speed could use some improvements.
Here are our major takeaways on the Phantom X2 5G:
Xiaomi sees slowing sales across all its main offerings, from smartphones, AIoT, and internet service, its third-quarter earnings report shows. The smartphone and electronics maker reported quarterly revenue of RMB 70.5 billion ($9.9 billion), a 9.7% yearly decline.
Why it matters: As electronics makers around the world navigate a market downturn, Xiaomi, the world’s third-largest phone maker, can provide investors and rivals some clues for the bumpy ride ahead.
Smartphone: Among the three sectors mentioned above, the smartphone business saw the largest yearly drop of 11.1%, shipping 8.8% fewer units in the third quarter, according to Counterpoint Research. Selling prices also saw a 2.2% quarterly decrease, averaging RMB 1,058 per unit.
IoT and lifestyle: Xiaomi’s IoT and lifestyle business had a 9% yearly revenue decrease and a 4% quarterly fall due to “weak consumer sentiment.” However, the firm posted a 39.5% increase in connected IoT devices year on year, reaching 558.3 million as of Sept. 30.
Internet services: Xiaomi’s internet service also performed flat, with a 3.7% yearly decrease but a slight 1.4% increase from the last quarter.
Context: Despite market pressure, the firm is committed to investing in research and development: Spending in this sector saw a 25.1% yearly increase in the third quarter of 2022. One successful example of such an investment is the development of the innovative 1-inch camera CMOS, co-worked with Sony. Xiaomi covered half of the $15 billion developing expense, according to Xiaomi CEO Lei Jun’s post on Weibo.
Plastics play a central role in numerous industries. The material has become firmly embedded in our lives, but increasingly that’s a statement that can be taken literally – microplastics were found in human blood for the first time in March of this year, adding to concerns about the environmental impacts of white pollution.
The race is now on to find ways to reduce such pollution and develop alternative materials, especially in plastics-heavy areas such as product packaging.
Representatives from Unilever, Finnish consumer packaging company Huhtamaki and biomaterial company Bluepha discussed alternatives to plastics and the different approaches that these firms are adopting at the BEYOND Expo 2022 sustainability conference, held online in the BEYOND Metaverse.
The text below features some of the highlights of the discussion and has been condensed and edited for clarity.
Thong Yinsheng, Senior Vice President, Asia Pacific, Fiber Foodservice, Huhtamaki
Only 5% of the carbon emissions in the food system are attributed to packaging in general. We know that the purpose of food plastic and as well as plastic control is to prevent environmental pollution. Since food packaging is essential, from an environmental perspective, we face several main challenges. Number one: making the positive choice in selecting the material for a fit of purpose. In terms of packaging and alternatives, we will look for solutions equal to or even better than the current plastic ones.
Another focus is increasing material recycling, especially at the end-of-life stage. It requires proper recycling technology as well as sufficient infrastructure. These are very critical.
Fiber will play a very important role. 70% of our product portfolio is made of fiber, either virgin fiber or recycled fiber. Virgin fiber is used primarily with food contact. And that’s where we ensure that the food safety and hygiene regulations are being met. While for recycled fiber, typically we use it for a trace, for example, where the shell itself is already a natural barrier to prevent direct food contact.
To meet this growing demand for plastic-free alternatives, Huhtamaki’s site in Alf, Germany is switching its focus from plastics to smooth molded fiber (SMF) products. That’s where we are able to have a significant impact. It’s the first such large-scale production capability in Europe. Now, when it comes to plastic, we are also focusing on how we can create new innovations in this. And now we have next-generation model materials that help minimize the number of layers being used.
Weiwei Kou, sustainability director North Asia, Unilever
We have a strong targets and commitments on plastics. There are four targets. The first one is regarding virgin plastic. We target to reduce original plastic by 50% by 2025, which means there will be 100,000 tons of absolute reduction.
Under the virgin plastics reduction, what we’re doing is driving investment in innovation in reuse business models. Particularly in our laundry product line, we have concentrated washing liquid. Instead of two-liter big bottles, you have the 15 milligrams [eggs], but with the same washing effects. It is also recyclable, like non-virgin plastic.
The second target is to help collapse and process more plastic packaging than what we sell. Collecting in China is very expensive so we invest in partners to improve waste management infrastructure like collecting, sorting, and processing. Right now, we’re looking for partners here in China to work on the collection model, because we don’t have a collection capacity at this time.
The third target is 100% of our plastic packaging will be reusable, recyclable, and compostable. The fourth target is 20% of our plastic packaging will come from post-consumer resin (PCR), a recycled plastic. PCR is on average 20% to 30% more expensive than virgin plastics. That puts a lot of cost on us every year across all our product lines, particularly for our home care and personal care, and product lines that use more plastics.
Bai Yuanbin, co-founder and VP Marketing, Bluepha
If using one sentence to describe our product, I’d like to say Bluepha is a 100% bio-based and marine-degradable biopolymer. It has four key features. First, it’s a natural polymer produced by microorganisms. The production method is different. It makes the product different – not only different from traditional plastic, but it is also different from other kinds of biopolymer. It’s the only biopolymer produced by a fermentation process rather than a petrochemical process.
Second, we use sustainable biomass at the feedstock to produce our Bluepha product. This biomass can be blonde or starch. Even [for] carbon dioxide, we have a unique technology named a biohybrid. That means we can use carbon dioxide and traditional biomass as feedstock.
Third, Bluepha has remarkable degradability in various natural environments and artificial environments, including marine freshwater, soil, industrial compost, at-home compost landfill, anaerobic digestion, and different kinds of environments.
And fourth, PHA (Polyhydroxyalkanoate) has versatile properties for multiple uses. By adjusting molecular structures, we can influence its all-around performance. We have developed different grades of Bluepha PHA to apply to rigid packaging, soft packaging, coated paper, fibers, coffee capsule, and other applications.
]]>Major Chinese phone vendor Vivo launched its flagship series X90 on Tuesday for the home market, partnering with optical giant Zeiss for camera sensor and lenses.
Why it matters: The phone came with a 1-inch camera sensor, the latest phone vendor to do so since Sony introduced the new 1-inch CMOS camera sensor. Sharp and Xiaomi also adopted the large camera sensor in their high-end phones earlier this year. Phone makers are embracing this new trend of beefing up camera functions, indirectly replacing entry-level compact cameras.
Details: The X90 series contains three models: X90 Pro+ with Qualcomm’s flagship processor Snapdragon 8 Gen 2; X90 and X90 Pro with MediaTek’s high-end processor Dimensity 9200. Available in three colors, the series is priced between RMB 3,699 to RMB 6,999 ($517 to $979).
Context: Vivo took 9% of the global smartphone market in the second quarter of 2022 ranking fifth after Oppo, according to Counterpoint Research.
Chinese tech giant Baidu recently showed off its AI capabilities with the unveiling of a newly “completed” ink painting by Chinese painter Lu Xiaoman (1903 – 1965), which was finished by the firm’s deep learning-based art generation platform.
As part of the presentation of the artwork, Baidu held a roundtable discussion with local auction house Duo Yun Xuan on Nov. 16 in Shanghai. The two partnered on the completion of Lu’s work, which the beloved 20th-century cultural figure had left unfinished.
This discussion presented two attempts to complete Lu’s original unfinished work: one is from famous Chinese artist Le Zhenwen, and the other is from Baidu Wenxin Yige, an art generation platform developed on Baidu’s deep-learning framework PaddlePaddle. The intention is to offer a comparison between the AI interpretation of the work and that of a human artist.
According to Baidu, its version of the work went through four phases: AI learning, AI painting, AI coloring, and theme poem composition. During the process, Baidu partnered with Duo Yun Xuan to collect public ink paintings to train models and reach a better outcome.
The twin artworks will be sold on Dec. 8 at Duo Yun Xuan’s 30th-anniversary auction event.
Below are comments on the project from Xiao Xinyan, chief architect of Baidu Wenxin Yige. His words have been translated, edited, and condensed for clarity.
In short, AI will shuffle and compose the concepts and datasets it has learned previously, which is somewhat of a knowledge presentation.
From a technical point of view, AI learns before it paints, just as human beings do. It is trained from a vast amount of data in image-text matches. Every painting has a text description. Al can learn the association between languages and images, as well as multiple corresponding concepts related to the images.
For instance, the concept of mountains could have a wide variety of image styles. So then how do people use AI to paint? They need to provide it with a text description, such as “a pine tree on a mountain.” AI will call on its learned experience and knowledge to generate a vague initial version randomly and then modify and perfect it continuously. There could be hundreds of rounds in the modification process, with the overall outline becoming clearer and clearer during the process, enriching the details. The work will be finally completed when it meets people’s esthetic requirements.
We [Baidu] adopt self-developed technology. There are two main points to our AI painting tech. Firstly, the image quality is high and looks delicate. We utilize a powerful diffusion model, which is a major technical innovation. Via multimodality of text and image, we can [give AI] a deep understanding, enabling it to create delicate artworks.
Also, we have a better understanding of Chinese culture, and we will build a relevant dataset to feed it for generations in such a style. For the training datasets, we also developed algorithms to evaluate the aesthetics to ensure they meet the criteria.
And considering users’ descriptions can be inaccurate, we enhanced the inputs system via a knowledge graph to provide related keywords for a better user experience.
So far, the feedback from users is quite positive; the platform has greatly improved their efficiency. For most casual users, they find the AI generator quite helpful. Looking ahead, we plan to explore a wider range of usage scenarios, for example using AI to assist children to practice painting.
The human being is of great importance in AI-driven paintings. In my opinion, human is the mentor of AI. We need to develop the neural network of the AI painting model: there are different models with various effects [and we need to choose ideal ones from them].
The human also has to feed AI some material to learn and determine how the AI should be trained. For example, Baidu Wenxin Yige was fed with traditional Chinese elements and cultural data to have a better understanding of this genre.
[The platform] can generate an image within minutes. On the first version of the piece drafted by Lu Xiaoman, the Baidu team consulted artist Le for advice. He then provided more training samples for a better outcome.
At the very beginning, AI needs people to teach it to generate the image: what content should appear in the picture and what styles should be presented.
Humans are also the ones to make a final decision despite the machine having an automatic algorithm to tell if the generated work is good enough because AI is not as accurate as human beings in this case.
]]>The UK government required the semiconductor firm Nexperia BV to sell most of its acquired Welsh wafer fab due to “risk to national security” on Wednesday. Nexperia BV is a Dutch subsidiary of China’s Wingtech technology.
The Welsh wafer fab, named Nexperia Newport Limited (formerly Newport Wafer Fab), is the largest fab in the UK, according to CNBC’s reporting. It has been fully acquired by Wingtech since last year.
Why it matters: This is a stronger move to stop China from acquiring critical semiconductor tech from the UK. Previously, the UK government just declined such acquisitions as it did in the case of a Chinese company trying to acquire electronic design automation (EDA) firm Pulsic.
Details: The acquisition began in 2018, when Wingtech obtained 79.97% of Nexperia’s shares, becoming its largest shareholder. Wingtech then bought the rest of Nexperia’s shares in 2020. During the previous year, Nexperia also invested in Nexperia Newport Limited (then Newport Wafer Fab) and became the company’s second-largest shareholder.
Context: Wingtech is a Shanghai-listed firm focusing on integrated device manufacturing, imaging module, and communication product integration, according to its official website.
Chinese tech giant Tencent posted its results for the third quarter of 2022 on Wednesday, reporting RMB 140.1 billion ($19.7 billion) in revenue, a 2% year-on-year decline. The figure missed analysts’ average estimation of RMB 141.6 billion, according to Reuters. Profit attributable to equity holders of Tencent for the quarter was RMB 39.9 billion, a 1% year-on-year increase and a significant achievement considering the company saw a more than 50% yearly fall in that figure for the first and second quarters of 2022.
The data follows a number of “adjustments” that Tencent has made to its multiple businesses, and also reveals that its gaming sector, which accounted for 31% of the company’s overall revenue in the third quarter, recorded consistent growth overseas.
Why it matters: Even as one of China’s most influential technology giants, Tencent is still struggling to fight against the macro downturn. As with other Chinese tech firms, it’s gaming arm has been increasingly looking overseas for growth, investing in international assets and working with partners to develop more titles for global publication. The return on this strategy is now evident in the company’s financial results.
Details: According to Tencent’s financial results, revenue from domestic games continues to fall this year, but international games have consistently contributed to revenue growth. In the past two years, Tencent’s domestic gaming business peaked at RMB 33.6 billion in revenue for the third quarter of 2021. Since then, it has dropped each quarter, mainly due to China’s gaming regulations aimed at minor protection, which include time limits for those under 18 and took effect in Sept 2021.
Context: Tencent is the largest video gaming firm in China and the second largest in the world by market cap. The tech giant also built a social network empire with QQ and WeChat (Weixin in China).
The China International Import Expo (CIIE) 2022 was held in Shanghai from Nov. 5-10, with primary chip manufacturing tool makers such as ASML, Lam Research, Canon, and Nikon among those in attendance.
The presence of the latter two was especially significant this year. ASML, a vendor for the most critical chipmaking equipment photolithography, has stopped serving Chinese clients due to American engineers being unable to work for advanced Chinese chip houses without a license under the US’s new chip export control measures released on Oct. 7. Although ASML dominates the photolithography market with a 90% share, according to Reuters, traditional Japanese optical giants Canon and Nikon are increasingly fighting for a foothold in the sector – and now have an opportunity to make in-roads in the Chinese market.
Canon entered China in the semiconductor manufacturing tools business in the 1980s, shipping photolithography and other chipmaking tools to local clients. Today, Canon provides equipment to major Chinese firms including SMIC, YMTC, and BOE, according to the firm’s brochure at CIIE.
In a group interview at the expo on Nov. 7, Akira Makino, chairman and president of Canon Optical Industrial Equipment (Shanghai) Inc., talked about the company’s lithography equipment and his views on the Chinese market. He also spoke of his optimism despite the recent downturn in consumer markets.
Below are selected highlights from the interview relevant to the Chinese market. The text has been translated, condensed, and edited for clarity.
The most advanced equipment we have built in mass volume is krypton fluoride (KrF) lithography, the wavelength of which is 248nm. The minimum linewidth it can cope with is 90nm.
Chipmaking can require multiple layers and the process is quite long, but not all layers need the most dedicated equipment. For these “rough layers,” our KrF photolithography could handle the work. We are also working on some new equipment, thought this is not yet ready for mass production.
From the technique perspective, our product is fundamentally different to our major rivals in pattern making. Nanoimprint lithography (NIL), the technology we contribute to, is expected to reduce production costs as extreme ultraviolet lithography (EUV) costs are presently quite high. If we manage to get the equipment ready for mass production, it will be revolutionary, largely reducing the spending on advanced chipmaking.
Secondly, our equipment is overwhelmingly more power efficient compared to EUV, another big cost advantage.
Finally, nano-printed patterns are printed once for each layer, unlike traditional lithography, which uses complex processes such as self-aligned double patterning and self-aligned quadruple patterning (SADP/SAQP), with which a single layer of patterns may require more than two exposures, so we think there can also be a productivity advantage.
Specific sales numbers and the unit amount that our clients possess are classified. But according to the publicly available data, the Chinese market became Canon’s largest market in 2020. Of course, this is not only the case Canon; for many semiconductor manufacturers, China is likely to be their biggest market.
Relatively speaking, our flat panel display (FPD) lithography and display panel manufacturing industries are concentrated in Asia. In this region, China’s share is the highest: China has contributed the largest share of Canon FPD business in FPD lithography equipment and OLED display manufacturing equipment.
For Canon, relationships with our customers and partners are of great importance to us. I have been in charge of the lithography business in China for 17 or 18 years. During this period, I have built good partnerships with customers in China. Some of them are domestic firms and others are from regions like Korea, Europe, and the US.
Of course, there are many factors that may not be controlled by enterprises or individuals. But for Canon and I personally, we have always adhered to the policy of “the relationship with clients is the most important.” We will continue to provide quality products and services to our clients and contribute to their growth in the future.
I believe that the [Chinese] market will definitely grow in the next five years, no matter whether it’s in semiconductors or fields related to displays. The display panel market has seen a downturn as smartphone sales are less promising, but such declines are relative to an over-performance last year. And generally speaking, I don’t think the growth trend is going to change.
There is a characteristic of the semiconductor market – customers hear more information about its application in CPU and storage cards, but semiconductors actually have broad applications, for example in sensors, power control, and telecom devices. And new applications keep emerging. The variety of semiconductors and broad range of applications is a potential growth point.
Another point is that China has its own potential. China has a large population, which makes it a large market and it is still in a developing phase, so the consumption capability is growing – people can afford mid- and high-end products.
So there are two aspects: first, China has a lot of potential in its own equipment manufacturing; second, there is a strong consumption capacity in the market. For us, our perception is that this market will keep growing. As for recent trends, we believe they are just some adjustments along the way.
]]>Chinese gaming giant Tencent held a special event on Nov. 12 to celebrate the seventh anniversary of its hugely popular TiMi Studio-developed title Honor of Kings. At the event, the firm provided new details about expanding a “universe” of productions related to the hit game.
Honor of Kings became China’s most profitable mobile title in January 2022, taking the crown from another mobile title developed by Tencent, PUBG Mobile. The game generated $190 million in September alone, according to US data firm Sensor Tower. Launched in 2015 in China, Honor of Kings recorded 50 million daily active users in 2016 and then hit 100 million in 2020, according to official data. Tencent brought the game to overseas markets for the first time this year.
The game’s success has spurred Tencent to pursue a similar strategy used successfully with League of Legends: building and expanding the game’s universe by adding related titles and spin-off products for greater revenue growth.
While the titles shown at the event did not come with specific launch dates, the update was still a positive sign that the projects remain in progress despite the recent challenging regulatory environment for the Chinese games industry.
The event showcased new developments on three gaming titles – Honor of Kings Chess, Honor of Kings: World, and Code: Breaking Dawn – and one animation entitled Brothers Baili (all names are our translations). We’ve outlined the details (that we know of so far) for each below.
At the release event, Tencent announced a new chess title based on Honor of Kings. Judging by the computer graphics preview, Honor of Kings Chess is either an auto chess or auto battle gaming title, with gameplay similar to League of Legends’ Golden Shovel (our translation). Players use strategies on the cards dealt to them or chess combos to fight with other players. The title was developed by a unit from the main Honor of Kings title, according to ITHome (in Chinese).
First revealed in October 2021, Honor of Kings: World is an open-world RPG title. At the event, Tencent released a new demo video of the gameplay, presenting more details about character skills and the gaming world. Based on this, the title features a stylish art design similar to The Legend of Zelda: Breath of the Wild, with stunning visual effects during combat scenes. The general gaming scenes are also of high graphic quality and look close to an AAA-level title. Some details, such as clothes and grass, display surprisingly realistic physical effects.
The title will be published globally on multiple platforms, according to the description of a previous video released through Tencent’s official Bilibili account.
Code: Breaking Dawn is a fighting game that was first announced in 2020. The game title brings major “kings” from Honor of Kings to a stage for Street Fighter-style player-versus-player battles. At the event, Tencent released a new teaser trailer, demonstrating the skills of some of the characters, including Sun Wukong, Diaochan, and Kai.
However, the title is still in development, and no specific launch date has been set.
In addition to the aforementioned gaming titles, Tencent also provided an update on its Honor of Kings feature film series. The first movie, named Brothers Baili, will focus on the stories of the two popular characters Baili Shouyue and Baili Xuance. The movie will dive into the brothers’ childhood, building out the characters’ backstories.
Based on the trailer, the animation could be presented in a 3D style. According to the description, the trailer involved Huang Chengxi, a notable director and animation artist who worked on 2017’s Boruto: Naruto Next Generations.
]]>Foxconn’s facilities in the Chinese city of Zhengzhou have made headlines around the world in recent weeks, as Covid outbreaks and control policies have hit the world’s largest iPhone assembly line. The city recorded 1,043 new Covid-19 cases on Tuesday, according to public data revealed by the local government, and at the time of writing, much of Foxconn’s operations in the city remain under strict control. The disruption has led many to predict stock shortages and longer delivery times for iPhone models in the near future.
Foxconn is Apple’s biggest iPhone assembler, accounting for 70% of global iPhone shipments. iPhone production accounts for 45% of Foxconn’s revenue, according to analysts from Fubon Research.
The affected Foxconn plant has 200,000 workers, and more than 10% of global iPhone production capacity is currently impacted by the Zhengzhou Covid outbreak, according to Ming-Chi Kuo, an analyst for TF International Securities.
The incident could be the catalyst that pushes Apple to move more production from mainland China to other regions such as India to reduce uncertainty and supply line dependency. According to Kuo, Foxconn will speed up its expansion of production capacity in India for the iPhone in the wake of the Zhengzhou Foxconn lockdown. He predicted that India-produced iPhones will increase more than 150% yearly in 2023 and that the share of global iPhone production in the country will increase sharply, from 2%-4% to 40%-45% in the next few years.
Below, TechNode summarizes the primary moments surrounding the Zhengzhou Foxconn lockdown since late October.
Oct. 26 – Covid cases detected at Zhengzhou Foxconn
Oct. 28 – Closed-loop policy enacted as workers flee
Oct. 30 – Local government responds; analyst projects decline in iPhone production
Nov. 1 – Foxconn increases salaries to steady production
Nov. 3 – Zhengzhou government forms unit to help Foxconn workers
Nov. 6 – Apple warns of iPhone production decline
Nov. 7 – Foxconn hires hourly paid workers
Leading Chinese cloud service provider Alibaba Cloud held its annual developer and tech event Apsara Conference on Nov. 3, revealing a series of products and services powered by its cloud services.
Three notable products were revealed during the conference, each demonstrating Alibaba Cloud’s move to develop open-source tech in AI and chip design. The firm also displayed its ambition to extend its cloud services to power more consumer devices such as laptops and desktops.
Established in 2009, Alibaba Cloud is the cloud arm of the e-commerce giant Alibaba. It has been a top three public cloud infrastructure as a service (laaS) service provider since 2018, according to IDC.
Alibaba Cloud revealed a series of new products based on Wuying desktop-as-a-service (DaaS) architecture. One of the highlights was the Wuying Cloudbook, an ultra-thin laptop that can run multiple operating systems, including Linux, Windows, and Android. The laptop features a 14-inch touchscreen and weighs 1.29 kilograms, a similar setup to the new 14-inch MacBook Air. The display has a 2k resolution with a 16:10 ratio.
All apps on the laptop are deployed remotely on the cloud, lowering the requirements for the device itself and saving battery life.
Alibaba claims the Cloudbook can last up to 20 hours when handling lightweight work and 12 hours when rendering heavy work or playing high-quality videos.
For performance, it can obtain up to 512-core virtual CPUs from Alibaba Cloud, with a Cinebench mark of 120,000. Theoretically, the laptop can acquire unlimited storage volume. It also comes with the support of 4G LTE and Wi-Fi 6. It is equipped with an HDMI video port and two USB Type-A and Type-C ports, separately.
T-Head Semiconductor, Alibaba’s chip-design arm, released a new processor called Xuantie C908 during the conference. The chip enriches the Xuantie family with a focus on power efficiency.
The new processor is based on open-source architecture RISC-V and is targeting the mid-end market, hoping to plug the gap between the C910 and C906.
The Xuantie C908 adopts the RISC-V Vector 1.0 standard and adds support that optimizes AI computation. The computation capacity is about 50% better than older models in AI application scenarios like image classification and keyword spotting, according to data provided by Alibaba.
The new chip can run at up to 2 GHz frequency, thanks to the efficient pipeline design. Built with TSMC 12nm process, the processor’s dynamic power consumption can be 52.8 mW per GHz for each core. The energy efficiency ratio of XuanTie C908 in typical scenarios can be improved by over 20% compared with that of XuanTie C906 under the same frequency and process constraints.
For applications such as intelligent interaction, AR, and VR, the processor also has an AI acceleration engine.
Founded in 2018, T-Head Semiconductor is a wholly-owned semiconductor chip business entity of Alibaba Group, according to their official website. The firm focuses on products including AI chips and CPU Processor IP, covering end-to-end chip design processes.
ModelScope, an open-source AI modeling platform, was also launched by Alibaba DAMO Academy, the firm’s research and AI arm.
Over 300 “ready-to-deploy” AI models will land on the platform, covering all fields, from computer vision to natural language processing. The platform already has over 150 well-recognized models. Alibaba also offers some of its own pre-trained AI models, such as Tongyi, which can generate images from text prompts.
Profitability is not the platform’s first priority, according to Alibaba. Instead, the tech giant intends to make AI models more accessible and effective through the open-source platform and community.
On ModelScope, developers and researchers can test models online, customize them, and deploy them on Alibaba Cloud, in a local environment, or on other platforms.
With the support of multiple mainstream AI frameworks, the platform will stay neutral and open to all developers, Alibaba has stated. Users can decide how to train and develop these models.
Correction: An earlier version of this article misfiled Xuantie C908 as Xuantie C098.
]]>Chinese telecom giant Huawei introduced the Pocket S, a budget flip-style foldable phone, on Wednesday in China. The phone has a lower price range compared to other foldable phones, priced between RMB 5,988 and RMB 7,488 ($819 to $1,025).
Why it matters: Huawei has so far dominated the foldable phone market in China. The new Pocket S further lowers the entry price for a foldable phone, making it a strong rival to the Samsung Z Flip series.
Details: The Huawei Pocket S is a cheaper version of the Pocket P50, sharing a similar core experience but compromising on key specs like the processor and cameras.
Context: Foldable phone shipments in China saw a sharp yearly increase of 246% in the third quarter of 2022 to 1 million units. Huawei is the top foldable phone vendor in China, and shipped 44.9% (in Chinese) of the units in the country in the third quarter of 2022, according to IDC.
HHOGene, a new consumer electronics brand founded by the former CEO of Alibaba’s DingTalk Chen Hang, launched its first product GPods, an earbud that can beam lights, and have raised more than $120,000 on an Indiegogo campaign earlier this year.
The GPods come with innovative light effects that are customizable, a unique selling point. It also has a comfortable wearing experience and decent sound quality in its price range. With a flashy light feature, the product targets fashion followers and music lovers that prefer something different.
HHOGene GPods will be first available from Nov. 1 in the US, priced at $169. The brand offers four extra earbud casings to allow users to customize its light textures.
The body design of the earbuds looks plain, but when you turn it on, its eye-catching light effects set it apart from other true wireless stereos (TWS).
The whole outer side of the “handle” parts of both earbuds can glow. The casing on the lights is well-processed to create a foggy effect, making the light look soft and elegant. HHOGene also offers detachable casings to help users switch from different textures.
The light effects are customizable via a paired app, which has a neat and user-friendly UI and offers a variety of color pattern presets to choose from. Users can also generate customized patterns from photos. There’s even an option to make the earbuds glow with a color that matches one’s clothes.
The earbuds can also glow in sync with the rhythm of the song being played over them, with four modes for users to choose from – Ripple, Pulse, Bright, and Breath.
One can adjust brightness. However, the maximum brightness is still not enough, meaning the effect can be lost in bright daylight.
HHOGene has done a good job in comfort. It’s less noticeable in the ears, thanks to its lightweight design (5.7 g per earbud) and comfortable tips. It remained a comfortable and snug fit after hours of wearing. However, the actual experience could naturally vary due to people’s different ear shapes.
The earbuds also offer controls on the handles. One can set different functions, such as skipping songs, pausing play, and answering phone calls, for gestures including single, double, or triple taps, and long presses for each side separately.
GPods surprised us with its sound quality. The buds offers a clear and balanced tone and do a good job of capturing the details of music: high frequency is bright; the bass is solid and strong but not overwhelming. It don’t offer an intense, sometimes tiring listening experience as some of the other mainstream options in the market.
A special point lies in its presentation of the human voice, which feels especially close to our ears.
For the hardware specs, HHOGene GPods adopt a processor named BES2500 from Chinese firm Bestechnic, which is also used in Oppo and Huawei’s TWS products. They feature a mainstream Bluetooth 5.2 version, with AAC and SBC supports.
The potential of the earbuds’ sound quality is limited by its audio codec. It’s particularly telling when connecting to an Android device, as most of them have aptX codec, delivering higher-quality sound than the AAC codec, which GPods use. iPhone users don’t have such concerns as the devices only support AAC.
HHOGene Pods support active noise cancellation (ANC) and have a transparent mode like rival TWS in a similar price range. However, the feature is lackluster.
One can tell the difference when turning the ANC feature on, but it’s far from satisfying. Another drawback is the background noise. One can hear weak white noise, like current pulses, when listening at certain low volumes. For people who prioritize ANC features in earbuds, there are better options in the market.
Given the issues with this feature, it might be a better idea to simply turn it off and save an extra hour of battery life. The buds offer up to five hours with one charge, and 20 hours with the case.
Users can see the battery percentage of both earbuds and the charging case from their app. The app has also been optimized for Apple devices so that you can view the earbuds’ battery status on iOS’s widgets.
The earbuds have a relatively larger charging case in terms of body size. With the largest side facing up, the HHOGene Pods case is almost twice the size of that the Apple Airpods Pro in thickness. For people who are used to putting charging cases in their pockets, this may feel chunky.
In summary, the HHOGene Pods is an impressive design. There are numerous TWS products that have hit the market in recent years but we rarely see something that introduces new designs while also offering a reasonable price and good sound quality.
Here are our main takeaways:
Correction: An earlier version of this article mistakenly said the brightness of the earbuds is unadjustable.
]]>Singles Day, China’s biggest year-end shopping event, kicked off its pre-sale period across platforms on Monday. Sales data from e-commerce giant JD, a platform known for consumer electronic offerings, showed sizable growth in consumer electronic sales.
Why it matters: Although JD’s sales data showed growth, the data still suggests some cause for cautious optimism as the platform only revealed the percentage change in sales – not the exact number of units sold. This year’s Singles Day comes amid a backdrop of a global slowdown in consumer electronics due to weak demand, especially for smartphones and PCs. Brands are hoping that the mega e-commerce event can offset some of the losses in recent months.
Details: Within the first second of Monday’s shopping event, smartphone sales from Apple, Xiaomi, Honor, and iQOO hit RMB 100 million ($13.76 million) cumulatively on JD, according to data from the platform. Oppo, Vivo, Samsung, OnePlus, Motorola, and Meizu saw 100% growth in sales in the first ten minutes compared with the same period last year. Foldable phones also had a 400% yearly growth in sales within the first ten minutes of the promotion. High-end gaming laptops equipped with a display with over 2k resolution and ultra-light laptops saw smaller 70% yearly growth in sales within the first ten minutes.
Context: Major e-commerce giants Alibaba and JD have started their yearly Singles Day shopping event with a major promotion of RMB 50 discounts for every RMB 300 spent.
South Korean memory chip maker SK Hynix reported less promising than expected quarterly results on Oct. 25, with net profits dropping 67% year-on-year in the third quarter of 2022. Comments from a senior executive during a subsequent earnings call demonstrated concern for the firm’s business in China.
Why it matters: US authorities issued new export controls on Oct. 7, aiming to limit China’s semiconductor industry, measures that have had a ripple effect on international firms like SK Hynix operating plants in mainland China.
Details: On a Tuesday earnings call, Kevin Noh, chief marketing officer at SK Hynix, expressed concern over the firm’s plants in China and said the company could “face difficulties” in operating fabrication plants in the country when the one-year exemption from US restrictions authorized by the American Department of Commerce comes to an end.
Context: China is an important market for SK Hynix. It had invested more than $20.3 billion in Wuxi by the end of 2020, and the firm has four factories and seven offices in China, according to Caixin.
Chip manufacturer TSMC sees a declining utilization in 6nm and 7nm processes as people buy fewer smartphones and PCs amid a global economic slowdown. It expects to cut utilization of certain chips in the next three quarters.
Why it matters: The market downturn will not see a recovery in the next six to nine months due to the “gloomy economic outlook,” according to market analysis firm Canalys. Chip contractors like TSMC, which had a high capacity utilization rate, now face vacancies in certain tech nodes.
Details: TSMC released its financial results for the third quarter of this year on Oct. 13 and gave conservative guidance of 0.4% quarterly revenue growth for the next quarter. The company also said its 6nm and 7nm production could remain affected until next year.
Context: TSMC is a top chipmaker worldwide, dominating 56% of the market by revenue in the second quarter of this year, according to Counterpoint. The chipmaker generated a revenue of $20.23 billion for the third quarter this year, a yearly growth rate of 35.9%.
As AI technology becomes a ubiquitous invisible force in our daily life, traditional fields such as medical research and development have embraced the technology to speed up processes and change the industry.
Wen Shuhao, the founder of AI-powered drug developer XTalPi, said, “the door for the digitalized drug industry, intelligent automation, and AI-driven drug development has opened.”
Wen shared his views on how AI works in the process of drug research and development and discussed what startup they would invest in a fireside chat at the BEYOND Expo 2022, held online at BEYOND Metaverse on Sept. 23.
First, we need to know what AI is before we figure out what AI drug discovery is. From our perspective, AI is all about collecting, connecting, computing capacity, and sharing data worldwide.
In terms of AI drug discovery, it’s all about using AI algorithms to help us understand drug structures such as AlphaGo 2.
Compared to traditional chemistry, looking at hundreds of millions of molecules, we can do many properties predictions and then form a feedback system, which is what AI can help us with.
That’s our interpretation of the essence of AI drug discoveries. This is a new paradigm instead of relying on humans for drug discovery. We can use huge computing power and algorithms for more effective drug discovery and development.
[We] hold great expectations in artificial intelligence for drug research and development. AI in the drug industry is an inevitable trend. The door for the digitalized drug industry, intelligent automation, and AI-driven drug development has opened. It does not happen overnight but is a process.
XTalPi is pretty lucky. Most of the leading companies in this industry started in 2015. In the past couple of years, we raised about $100 million. The top 20 pharmaceutical companies have established collaborative relationships with my company.
AI drug development is about building the most efficient feedback system, not just the algorithm. Whether the score your AI or algorithm produces can be fed back to the AI in the most efficient experimental way matters too.
We want to lower the barrier to drug development. So we want to be able to help more biological and farming companies so that they can develop more drugs and benefit the entire industry.
And to do that, we were able to develop and incubate many ecosystem partners so that we can also give feedback to the industry and get returns from this.
And there are a lot of unmet needs in the industry. For example, we helped two companies — one work on self-immunity and another on stomach cancer — [on fundraising.] Both are small startups with huge market value and facing difficulties accessing early rounds of funding. Within a year, we help them to get funding. I think they are doing great things, and their founders also have great expertise and much experience in medical practice and have published five or six articles in Nature.
And they are also the first top-ranking researchers in their specialized fields, so we can help them scale. And also another company is doing AI medicine to develop a delivery system. So within three years, they gained several rounds of funding, and they could grow 50 times or 100 times faster than before. And we’re able to develop and help to grow these companies.
]]>From transportation to defense to smartphones, graphene, the lightweight and ultra-strong material, can be used in various fields and has the potential to become a ubiquitous engineering material.
Jiaxing Huang, chair professor of materials at Westlake University, shared his views on graphene and talked about why the material is important for modern industry and what China has been doing in the field at a fireside chat at the BEYOND Expo 2022, held online at BEYOND Metaverse on Sept. 21.
The text below has been condensed and edited for clarity.
Let’s look at the material science of graphene’s structure. The basic structure of the whole graphene family is single atomic layers of carbon. It’s carbon formed of single atoms – and that’s the fundamental structural characteristic of graphene.
So based on this structural characteristic, what exciting properties does it have?
The first is hardness. Graphene is single atomic in type and has a free-standing structure, making it an incredibly strong material.
The second is its thinness. The material is made of a single atomic layer, unlike other kinds of material like paper, which can be made to different levels of thinness. So it will only have one atom thickness. And its electrical properties lead to a strong ability to absorb light.
Graphene also has other properties, such as conducting electricity, producing heat, and possessing stable chemical reactivity. It won’t change if you leave it in the air for an extended period, making it convenient for various usages.
Graphene could become a widely used engineering material like aluminum alloy, which is so ubiquitous that you don’t even know it’s there.
I think the application of graphene won’t happen in one major eruption, but a more incremental and transformative process. The material may end up being used in your phone, in your computer or even in your clothes, like a graphene coat or a suit of armor.
It has the potential to be everywhere in every corner of your life. And if you want to use a material for heat management in fields such as outer space and deep sea exploration, graphene, as a non-metallic material, has lighter weight and better radiation resistance. That’s why I say it will become a fundamental engineering material.
Smartphones already adopt graphene for cooling. The material is lighter than copper and performs better in heat conduction. Although not exactly a killer[-level] application. Using graphene in smartphones is a great preparation for future killer[-level] applications.
In China, we now have a notable production capability of graphene in a single layer and a few layers. Thicker layers are made of folded single layers, and China can be said to be the best in this area. China also leads in the number of graphite powder manufacturers worldwide. There are fibrous, foam-shaped and a variety of other forms, too, where Chinese firms have done pretty well.
However, this industry has a high technological barrier. There are a lot of startups and American entities [doing similar things]. But they will soon meet a bottleneck in that the conductivity of [produced graphene] is two orders of magnitude worse than copper. Yet it’s ten times more difficult when you try to advance and close that gap. However, I have seen research results and applications of graphene in China [close to copper’s performance], which is really extraordinary.
]]>Apple has paused its plans to use storage chips from Chinese supplier Yangtze Memory Technologies (YMTC) due to mounting geopolitical pressure and criticism from US policymakers, sources told Nikkei Asia on Monday.
Why it matters: Apple’s reported move comes a week after the US announced sweeping export controls on China’s semiconductor industry, largely cutting the country off from accessing advanced chips and parts to make them. Apple’s decision to put the brakes on its deal with YMTC is a major blow to China’s most promising chip maker in NAND flash memory, as well as to Apple itself, which favored YMTC’s offering as it was 20% cheaper than that of its rivals.
READ MORE: Chinese semiconductor firms bear heavy fallout of US chip sanctions
Details: Apple initially planned to use YMTC’s storage chips as early as this year and had already completed the process to verify the supplier’s 128-layer 3D NAND flash memory to use for iPhones, supply chain executives told Nikkei Asia.
Context: Founded in 2016, YMTC is a leading Chinese semiconductor firm focusing on storage chips with self-developed Xtacking architecture. Storage chips are a critical component in devices such as smartphones and personal computers.
On Oct. 16, top leaders of the Chinese Communist Party gathered in Beijing to meet for the 20th Party Congress. The week-long meeting, held every five years, attracts 2,340 delegates from the party to discuss high-level changes and topics, including the nation’s tech developments and strategy.
Chinese President Xi Jinping’s two-hour-long report formed the most significant part of the meeting. He reminded delegates that the next five years will be crucial for China to make breakthroughs in “high-quality economic development, achieve greater self-reliance and strength in science and technology, and make major progress in creating a new pattern of development.”
China has set out a long-term development goal of realizing socialist modernization before 2035. To get there, the party believes that the country needs to develop its tech sector further and bring tech innovation into traditional sectors.
In his speech, Xi said China needs to build a modernized industrial system that serves the “real” economy, set up a national strategy that helps drive innovation, and ensure new developments are eco-friendly and sustainable.
Xi emphasized that a modernized industrial system would be key for the country to achieve “high-quality development” and increasing domestic demands.
He stated that China needs to advance new industrialization and become stronger in manufacturing, aerospace, transportation, cyberspace, and digital development. His speech also emphasized that China should develop integrated clusters of new growth tech areas, such as next-generation information technology, artificial intelligence, biotech, new energy, new materials, high-end equipment, and green industry. The country also needs to improve its ability to secure the supply of strategic resources, Xi said.
China needs to find ways to make such developments serve the real economy, like integrating modern services with advanced manufacturing and modern agriculture and integrating the digital economy with the real economy, according to Xi. “We must continue to focus on economic development of the real economy when pursuing economic growth and promoting a new type of industrialization,” he said.
Xi acknowledged that China has recorded major achievements in several core tech sectors and growth in cutting-edge areas such as human spaceflight, supercomputers, deep sea exploration, satellite navigation, quantum information, nuclear power technology, large aircraft manufacturing, and biomedicine. Yet China’s tech industry still lacks technological innovation, he said.
He emphasized that China needs to improve its technology innovation system, creating an open innovation system with global competitiveness. He also declared the establishment of a new innovation-driven development strategy, including conducting original, industry-leading scientific research and making China an attractive country for technological innovation as well as a talent center.
The country plans to implement a number of national major scientific and technological projects to enhance the capacity for independent innovation, with hopes of becoming a global innovation leader by 2035. It will also create a “positive environment” conducive to the growth of tech-based small and medium-sized enterprises, Xi said.
According to Xi, innovation is at the “core” of China’s modernization.
Xi said the country needs to find a development model that also protects the environment, pursuing economic growth while cutting carbon emissions, reducing pollution, expanding green development, protecting ecology, and conserving resources.
Other major efforts under Beijing’s climate initiative include carefully promoting hydropower facilities given their large environmental impact, actively developing nuclear power safely and orderly, improving the official CO2 emissions calculation tool, and establishing a national carbon trading scheme. In addition, China continues to head toward carbon neutrality by shifting toward green energy vehicles. Xi vowed to promote a low-carbon lifestyle and step up the green revolution in the transportation sector.
In 2021, China’s ambition to become a leader in global climate actions faced major setbacks as operations of heavy industries such as steelmaking experienced a widespread power crunch. At this year’s congress, the central government addressed concerns around economic stability and strength, with Xi saying that China will steadily reach peak carbon and carbon neutrality, implementing control measures “in a planned and step-by-step manner.”
Xi said that the country would continue to speed up the establishment of a clean energy revolution while enhancing the “clean and efficient use of coal,” given its natural resource restraints. The strategy is meant to see a gradual reduction of total emissions as well as carbon intensity, which refers to the amount of energy consumed per unit of economic growth.
The commitment comes months after the central authorities in February extended the deadline for domestic steelmakers to reach peak carbon emissions by five years to 2030 and pledged to correct any “campaign-style” carbon reduction moves by local governments in August. Only a third of China’s provinces and municipalities met their carbon reduction goals during the first half of 2021, leaving as many as 18 regional governments enforcing power rationing and idling operations of energy-consuming industries later in the year.
]]>Since the US issued one of the broadest export controls on semiconductor technology to China in a decade last Friday, China’s semiconductor industry has seen its market value tumble for days in a row. At least 13 China-listed semiconductor firms saw market value decline more than 10% since Monday, and five saw a more than 20% decline.
Issued by the US commerce department, the comprehensive restriction bars companies from shipping advanced chips and chipmaking tools to China unless they obtain a special license. More specifically, the restrictions aim to cut off China’s access to and ability to make advanced chips under 16nm or 14nm, DRAM memory chips of 18nm or more advanced, and NAND flash memory chips of 128 layers or more. Those technologies are essential to supercomputing and artificial intelligence.
The Biden Administration cites China’s advances in military systems as part of the reasons for the measure. In mid-September, US National Security Advisor Jake Sullivan emphasized the importance of “preserving our edge in science and technology” at a speech and said the US must “maintain as large of a lead as possible” on certain technologies like “advanced logic and memory chips.”
A day after the US issued the restriction, China’s foreign ministry spokesperson Mao Ning said the measure “runs counter to the principle of fair competition and international trade rules” and “deal a blow to global industrial and supply chains and world economic recovery” at a press conference. China Semiconductor Industry Association (CSIA) made an announcement on Thursday, saying they are “troubled with applying the concept of national security and foreign policy interest to each action of the discriminating trade policy.”
To assess the immediate damage of the US’s measure, TechNode selected five Chinese semiconductor firms that took a major hit, including three chipmakers, a chip gear vendor, and a server provider.
READ MORE: The US’s moves to contain China’s semiconductor industry: a timeline from July
Companies have been exploring different gaming and social experiences in the Web3 spaces as they continue to build out the next generation of 3D internet experiences. Ownership and community have been essential to these new experiments, as well as new web infrastructure like blockchain.
Saro Mckenna, co-founder of AlienWorlds, and Mable Jiang, chief revenue officer at STEPN, shared their views on SocialFi and GameFi, and what could be different in from our current internet experience. The panel discussion was a part of the BEYOND Expo 2022 Web3 Summit, held online at BEYOND Metaverse on Sept. 26.
The text below has been condensed and edited for clarity.
We think that a blockchain construction is really required to be called a metaverse, because only with a blockchain construction can you have people really coming together, peer to peer, who are not simply there because of a centralized platform owner.
The first thing that we’re doing inside of the metaverse at scale is gaming. But there are many other aspects of our lives that happen within the metaverse, including education, work of other kinds, and certainly, social interaction is in the metaverse, which we’re already seeing through gaming.
There has been a lot of content creation and especially novel content creation. People are pushing the boundaries of what technology can do. What I love to see is the way that people come together. People are just so ingenious, and we’ll find a way to add value to any system and to create things. In AlienWorlds, there have been whole companies that have been created servicing the AlienWorlds’ metaverse. Some of them have created leaderboards and competitions that have even been built out a little bit, technically.
For the social-fi elements, if something’s adding value to a system, I think the question is more about who’s capturing that value – the person themselves or the platform owner. And that’s the real distinction between Web 2.0 and Web3.
So I’m not sure if I would necessarily emphasize the Fi (decentralized finance, DeFi) so much if the person is only involved in the system because they want to earn money. I think that’s potentially the connotation when you put the Fi suffix onto something. It’s more about empowerment and just the next iteration of property rights, and that gets extended into a metaverse environment under blockchain construction. And then everything that results from that, all the potential and creativity, get unleashed when you acknowledge the sovereignty of people’s capturing into the platform itself.
I think one of the things that’s kind of interesting is what we see on social media. People have been pushing the boundaries of that for themselves as influencers, right? So these are people who are like super sharers on social media. And they do manage to monetize a bit of a position for themselves through a lot of hard work. But they’re sort of working against the boundaries of what’s been created. It’s only if they happen to be a breakout success can they earn something like a living wage.
Whereas what we’ve done in Web3, the starting point is that people just own the fruits of what they’re doing beyond that and love how they transfer that value around. So that doesn’t mean that there aren’t paid services or that everything’s free. There are plenty of commercial services that get offered in the metaverse. But people themselves will choose to engage in them. And I think that creates far more creativity [in the system].
I would be actually very straightforward about SocialFi, I actually never liked adding the word Fi after everything. I think that’s a very mimetic way of doing things. When we talked about our product, we just mentioned that there’s like social element instead of SocialFi.
Within the whole metaverse, and regardless of how you define metaverse, not everything needs to be powered by blockchain, that are valuable, and needs to be actually stored and have instant finality will require blocking settlement within what we are seeing today.
There are a few things that actually could be monetized, influence is one of them, such as social graphs. That’s something that could actually be recorded by the blockchain. Also, there are a lot of actual activities that people will try to do to accumulate their social relationships. But those activities, those proof of work, do not really have to be recorded every single step on chain, but rather just a result of it.
There are a lot of interesting potential things that people could explore around, like anything related to social, and could also be captured by tokenizing the specific names or specific results of that social behavior. But I think the process of it probably will still likely to happen in a Web 2.5 stage.
I do think game-fi or like extra to earn has their own merit to it in a certain historical period of time because it has bootstrapped a lot of users within a short period of time. However, I think if you do want to keep these people within your ecosystem, you do need to think about the question of externality. So then you know it’s about maybe working with external brands, or maybe with like some other lifestyle applications to really give the users who you use the extra to earn kind of models, other things to do, or actually to do something that’s like creating values, or at least like creating values for themselves.
One thing that we were trying was opening our merch store (merchandise), but it’s not just a simple shop on our website. It’s actually going to be rendered by a partner within their actual virtual merch store. And people just go in, and they can buy, and they will have the ownership of that. The NFT is for people to get physical merch. That’s an example of the hybrid model. So I think there are many things that we can obviously leverage and go around with it.
]]>Major Chinese EV makers – Nio, Xpeng, and Li Auto – are all making moves in producing their own chips for vehicles, as the former two focus on AI chips for autonomous driving and the latter works on more basic semiconductor components, according to Chinese media outlet LatePost.
Why it matters: The move reflects a growing trend among Chinese EV automakers to bring some chip production in-house, as an ongoing global semiconductor shortage continues to hinder vehicle production.
Nio looks to autonomous driving and lidar chips:
Xpeng develops NPUs for autonomous driving chips:
Li Auto focuses on power semiconductor devices:
Context: Multiple Chinese automakers have been looking to move into chip manufacturing, having been hit by the ongoing chip shortage amid growing uncertainty caused by multiple supply challenges, including the US chip export ban to China.
On Friday, the US announced a new set of semiconductor export restrictions aiming at cutting China off from accessing certain high-end chips and further limiting the country’s ability to try to make advanced chips themselves.
The Department of Commerce’s Bureau of Industry and Security of the US issued nine new rules, detailing that new rules aims to impose export controls on advanced chips, transactions for supercomputer centers, and transactions involving certain entities on the Entity List. In addition, the new rules also impose new controls on certain semiconductor manufacturing equipment and on transactions for certain integrated circuit end uses.
These rules will be less strict on firms “owned by multinationals,” according to the file. Twenty-eight Chinese entities on the US’s Entity List are affected by the expanded rules, most of which are supercomputer institutions and AI firms. Some new rules take effect immediately, with others effective before Oct. 21.
The US’s Bureau of Industry and Security adds 31 new Chinese entities to an “Unverified List,” including major Chinese memory chip maker YMTC. Firms that tend to export or transit products listed on the Commerce Control List to China now have to ask permission from the US. Entities listed on the Unverified List are one step away from being added to the Entity List if they do not meet the US’s requirements within 60 days.
These new rules follow a months-long effort of the US trying to contain China’s ability to obtain advanced chips and chipmaking tools. Since July, the Biden administration has barred Chinese chipmaking firms from acquiring tools for 14 nm and more advanced chips, focusing heavily on central logic chips like CPUs and GPUs. Since August, the US has also considered broader restorations in fields such as memory chips as major Chinese chipmakers YMTC and SMIC continue to develop their own chips.
Below, TechNode summarizes the key moments from the US’s attempts to hobble China’s semiconductor industry since July.
July 6 – Lithography machinery
July 30 – Tools to make 14 nm chips
August 2 – Memory chips
August 12 – EDA software
August 31 – High-performance GPU chips
September 21 – Nvidia looked to bypass US ban, providing alternative GPU to China
The “metaverse” has quickly found its way into mainstream vocabulary since last year, with an array of tech majors eager to stake their claim within it. But how should we really define the metaverse and how can we ensure it’s built in a way that works for everyone? Moreover, where do its boundaries with reality lie and what impact will it have upon our more tangible world?
Harry Shum, founding chairman of the International Digital Economy Academy (IDEA) and a former executive vice president of Microsoft, explored these topics and shared his vision for the future of this field as part of a keynote speech delivered on Sept. 26 at the Beyond Expo 2022 tech conference, held online at BEYOND Metaverse.
The following transcript has been condensed and edited for clarity:
People initially became excited about the metaverse because of the publicity from Facebook’s name change to Meta and the excitement around Roblox’s successful IPO.
To understand the metaverse, I’d like to define metaverse technology in four layers: application, interaction, entity, and protocol.
Application is where human beings experience the metaverse and participate in activities to accomplish certain purposes. Interaction is the physical process where human beings connect with the metaverse, receive the metaverse, experience the metaverse, and have fun through interactions with others.
What kind of entities will exist in the metaverse? How will entities in the physical world get reflected in the metaverse? What about AIS [Association for Information Systems] in the metaverse? How do we define and create entities in the metaverse and specify the rules for the activities that take place there?
And just like the physical universe where time and space are defined, the metaverse needs its own protocols to define how everything is connected and how information gets exchanged.
Many important problems need to be addressed. For instance, how do we define the ownership of any entity? A good way to understand these technological layers is to compare them with counterparts in the physical world and the internet.
In fact, many people view the metaverse as a significant extension of the internet as we further move into the virtual world.
1. Application
In the physical world, for instance, a market is an application where people come to sell and buy goods on the internet. People can stay at home and buy goods with e-commerce applications. In the metaverse, people can try and experience goods in immersive ways before ordering them.
2. Interaction
In the physical world, people use pen, paper, speech, and language to exchange information. With the internet, people use computers and smartphones, interacting via apps like WeChat on a 2D flat screen. With high-quality AR and VR equipment, people can immerse themselves in the metaverse and have much richer multimodal information exchanges. We have come a long way with AR and VR technology. Yet great challenges remain in building powerful and lightweight AR glasses. It’s great to see exciting brain-computer interface research lately, although it’s far away from being practical.
3. Entity
Entities in the physical world can be persons, companies, organizations, and all sorts of objects. Interestingly, entities are not clearly called out on the internet. Rather, entities are mechanically incorporated into independent web apps on the internet, which has led to them being defined by powerful apps. By introducing entities back into the metaverse, we make sure that entities are not defined by apps, but belong to the entire society or metaverse.
4. Protocols
The physical world can be accurately defined in space-time coordinates. For instance, distance and relationship. With protocols like HTTP and HTML, the internet has its own definition of relationship and distance. With the help of blockchain, we have records of activities and relationships between human beings, AI beings, and objects in the metaverse.
We should have metaverse equivalence protocols like HDEP and HTML and definitely need to have a browser for the metaverse so that we can keep exploring the metaverse. Let me show you an example of AI beings in the metaverse.
This a newly-released app called Xiao Ice Island [Xiao Bing Dao, in Chinese] is where human beings, AI beings, and objects interact in a metaverse. When you start the app and get on your Xiao Ice Island, you get to meet 10 AIs with various capabilities like seeing and chatting.
Xiao Ice Island is the first AI social network in the metaverse. Like it or not, we are entering the metaverse as we spend more and more time in the digital world.
Here at the BEYOND Expo, many exciting metaverse technologies, applications, and systems are on display. I’m looking forward to sessions that cover a variety of topics in the metaverse from smart cities to branding, from entertainment to hardware.
We are at the beginning of a long journey into the metaverse. The best way to predict the future is by creating it. There is so much to be invented in the metaverse from technology to product to business models. Let’s do it together. Thank you very much.
]]>Chinese phone maker Oppo released its new generation of smartwatches, the Watch 3 series, in August with a price tag of RMB 1,599 – RMB 2,099 ($228 – $300). The company first entered the watch market in 2020 and updated it annually.
The latest series has a new look and offer more premium features such as long battery life, and always-on feature supported by LTPO OLED display.
The version we tested, the Watch 3 Pro, is currently only available in mainland China and Oppo has yet to reveal any plans regarding overseas markets, but there is an expectation that it will eventually be sold internationally.
The first thing that impressed us about Oppo’s new Watch 3 Pro is the massive 48.5 mm curved display. It offers more space to display content than most of its Android rivals. Apple’s newly released Apple Watch Ultra comes with a 49 mm display but is more than doubled the price of Oppo’s offering.
The larger display enables the watch to showcase more information and users can track more metrics at the same time. An innovative change is the watch’s curved display, which fits better with one’s wrist and offers a clearer view when checking the watch from different angles.
Another good touch of the watch is the mechanical rotating crown on the side. It offers another tangible way to interact with the watch, considering slides on the touch screen may sometimes block the display of other content. The crown also stimulates realistic mechanical vibration feedback when spinning.
The watch’s large size leads to a heavier weight of 37.5 g (without bands), – a thing to adjust for those who are used to a more lightweight watch.
The black model we reviewed came with a classic-looking black rubber strap. The band is fastened through steps rather than being completely adjustable, which leaves it open to the possibility of being either too loose or too tight if your wrist doesn’t match up with the fixed steps.
The rubber material is waterproof (potentially making it a good companion for swimmers) and is also easy to clean. But for all-day use, we would recommend getting a nylon or Milanese strap, which fits more wrist sizes and has better breathability. If you want a more stylish look, the silver version with a leather strap could also be a better choice.
The system interface has a decent design, with good readability and accessibility. The font size and weight are well chosen, while essential information is marked with vivid colors. The transitional animation is quick and clean.
With a swipe of the home screen, the watch can access all essential secondary interfaces, like essential health metrics, widgets, quick setting toggles, and notifications, similar to a phone’s swipe-up feature.
The watch we reviewed was installed with ColorOS, and given its marketing to the Chinese market, it did not support Google Play or any other WearOS features. It provided over 80 apps through the built-in app store, covering the most common Chinese apps such as WeChat and Alipay. This means that if you enable the e-SIM feature, you can leave your phone at home and have access to the most essential software.
And just like other smartwatches, you can receive notifications and calls, monitor sleep stages, and conduct a quick electrocardiogram (ECG) test. However, the ECG app, for now, says “coming soon.”
When doing intense workouts, the weight of the watch and its slightly rigid watch band take some getting used to.
Despite that, the Watch 3 Pro has the potential to be a great exercise companion tool. Oppo sets four goals for users to hit, displaying these as four loops: steps, calories, workout, and activity. We found it a little harder to achieve the default goals, but one can adjust them to meet your needs.
The device can auto-detect six kinds of workout, including running, walking, cycling, swimming, elliptical machine work, and rowing machine activity. We tested walking and cycling and it had no problem detecting the former, but somehow missed the latter so we had to manually record the workout from the health app instead.
When it comes to manually recording, the watch offers dozens of types of workouts to choose from, with some featuring detailed subcategories. Dance, for example, has ten different styles, including waltz, street, and jazz. While this enables fitness enthusiasts to track their niche interests, it can feel daunting to new dancers. It also lacks a more general choice to record less common or freestyle workouts.
The recorded workout generally offers information about GPS mapping, duration, burnt calories, heart rate, etc. It even highlights different heart rate zones, helping users understand how close to their maximum heart rate a certain activity is getting them; for example, zone one is “warmup” and zone two is “fat burn.”
The Oppo Watch 3 Pro’s battery life is impressive. Qualcomm’s new Snapdragon W5+ Gen 1 processor provides higher performance and halves the amount of power consumption compared with the last generation. It has a large 550 mAh battery, even bigger than Apple Watch Ultra’s battery volume, according to iFixit.
We turned almost all features on, including the always-on-display, all-day heart rate and blood oxygen monitoring, and workout auto-detect, to drain its power as soon as possible. We also paired it with a phone that was installed with dozens of news and social media apps, sending a plethora of notifications to ensure that the watch display has a longer illuminated period. Despite all this, the watch managed to last three days without charging. For regular usage, the battery should last a few more days.
With its charging stand, the watch can be fully charged in around an hour.
What surprised us is that Oppo adopted a universal design for its charging stand: you can plug in any USB Type-C cable and supported charger to power it. Helping travelers to carry one less cable.
Another neat feature is that the stand uses magnets to connect with the watch, charging through contactors. Compared with wireless charging, it can reduce overheating issues, but the contact points could also age from oxidation and corrosion.
The Oppo Watch 3 Pro has a classic design, a large display, long battery life, and a solid core experience. There is room for improvement, such as a more comfortable strap and weight reduction, but overall it is a reasonably priced high-end Android smartwatch.
The upcoming overseas version should come with the full suite of Google offerings. We would recommend this watch to Android users with a larger wrist size, especially those who own an Oppo phone and can therefore unlock features across devices. For Apple users, it can still provide core smartwatch features and comes with a cheaper price tag than an Apple Watch.
Here is our summary:
In recent years there has been a concerted push within the field of consumer electronics toward smart devices and digital services, with the emergence and growth of sectors such as smart home, digital health metrics, and online shopping tech. But how has the pandemic impacted such trends?
Becky Center, CEO of Indiegogo, Alex Yang, co-founder and COO of Tuya Smart, and Romeo Luo, General Manager of Asia Pacific and Europe at Anker discussed these major global tech movements, Covid-19’s impact, and future trends at a panel discussion on Sept. 26 at the Beyond Expo 2022 tech conference, held online at BEYOND Metaverse.
The text below has been condensed and edited for clarity.
From a global perspective, the developing trend of smart home products and smart home services is unstoppable. From an Asian perspective, clear trends can be seen in smart cleaners, smart storage for toys, smart child care, and other add-ons related to in-house scenarios.
I’m the kind of person who wants to buy cleaning products because I want the cleaning robot to help me clean my home while I’m asleep. Smart homes and smart security products have been on the rising trend for a while.
Another [rising] area is dining. There are all kinds of small home appliances for manufacturing food in Asia. The speed of development here has been very fast and during the Covid outbreak, sales of such products got even better. Even areas like generators and batteries for family use saw sales growth. Consumers are paying more and more attention to such products. And it is easy to understand why sales of such products are rising during the pandemic.
The biggest pusher of technological progress is that people are getting lazier, and they are starting to care about their health. Also, people increasingly rely on their smartphones to control everything, like their facilities and devices at home. They even want to put their health data into phones, and I think that’s a habit that will drive technology forward, helping people to live healthier life.
People usually don’t like to work out, so they need to have some power to force them to exercise, such as seeing more data. They need data from apps to tell if they have a good workout and encourage them to continue. If they missed three days’ attendance, they would want to get back on track to continue exercising. And this is a very popular trend in our view.
People need to know how many calories they are burning and how much energy they are using in their homes, and more consumers are using data to drive their behavior. Those tools have been high in demand.
When we talk about changes in [buying] behavior, we have to start with the changes in sales behavior. Many brick-and-mortar stores have opened their own online stores, and major supermarket suppliers have set up online platforms. For companies like Walmart, selling online or offline is the same because they have integrated the two channels.
We also have livestreaming channels on Taobao, which makes it not only an online e-commerce platform. Sellers can interact with consumers in real time, which is a great change. It can better enhance interaction, recording the traffic trend and direction. And we are basically following this trend, tracking consumers’ consumption habits and needs, hoping they can find products in the most accessible channels. For example, we know that Austin Li returned a few days ago. He is the king of livestream e-commerce. In the livestreaming room, he can bring waves of sales just by interacting with the audience.
Therefore, we can see the combination of offline products, online sales channels, and communication channels. It would have taken us a decade or two to get there if the pandemic didn’t force us, or it would have taken us a long time globally to get there.
]]>TikTok owner ByteDance launched its Pico 4 VR headset in China on Tuesday, following its unveiling to the overseas market on Sept. 23, offering more exercise content and incorporating a number of entertainment deals with local partners. The Pico 4 has a price range in China of RMB 2,499 – RMB 3,799 ($352.76 – $536.27), based on different storage options (128 GB – 512 GB).
Why it matters: VR and AR devices are increasingly popular in consumer markets, but affordable, high-spec options in China remain scarce.
Details: Pico will work with Chinese content providers to offer a range of services, including virtual concerts, exercise courses, and interactive narrative work.
Context: Pico has been working with partners in the content industry to enrich the experience of its devices. The firm launched Pico Video in March with an in-depth partnership with over 30 VR video-creating firms and major Chinese streaming platforms.
SenseTime’s co-founder Xu Li shared his vision and insights on digital natives of the metaverse and how their habits can redefine business models in the immersive virtual world. This keynote speech took place on Sept. 21 at the Beyond Expo 2022 tech conference, held online at BEYOND Metaverse.
The text below has been condensed and edited for clarity.
In 2020, Travis Scott’s virtual concert on Fortnite attracted 100 million views from 23 million audiences, generating $20 million in revenue. The show is completely virtual. Why did it attract so many consumers?
We have to talk about it from the perspective of the metaverse natives. From their views, the barrier between the real world and the virtual one is thin. The difference between both worlds can be torn down fairly easily.
In the traditional internet era, the distinction between the virtual online world and the offline world has always been clear. There is a very clear boundary when people surf online. I remember when we, the first generation [of netizens,] surfed online, we had to dial via modem to get connected, a ritualistic process. But today, in the mobile internet era, we are connected all the time, with all devices.
And that’s why we’re suddenly talking about the word – metaverse – today. The old internet world wasn’t that real. In many cases, it’s not exactly like the real world. So you won’t think of it as a universe. But now, the virtual world is reaching a new level in digitization, vividness, and interactivity, further blurring the boundary between the digital world and the physical world.
And that leads to a new generation of digital natives who do not experience difference [between the two worlds].
Metaverse natives identify themselves with virtual goods. They are not just buying the things, but an icon, an identity for themselves.
For example, when we play games in virtual scenes, we may need to enter with an avatar, creating our own digital image.
Since everyone would want a unique identity, even in the virtual world, we want to create our own characteristics. Many of the purchases in the metaverse are driven by people wanting to express their personalities to the outside world.
Many people would ask whether the metaverse has big commercial potential. I foresee new disruptions to the core business models in the internet age as long as productivity tools and interactive experiences keep improving.
We can think about what a platform company can do for today’s internet: social networking, searching, e-commerce, and traditional games. In the metaverse, all the current business models on the internet can be redefined. If we think about new business opportunities from the viewpoint of metaverse native, we will get to wilder imaginations.
]]>Chinese phone vendor Vivo launched its second generation foldable phone, the X Fold+, in China at a release event on Monday night, with a price tag of RMB 9,999 – RMB 10,999 ($1,396 – $1,536).
Why it matters: Vivo’s new foldable phone uses a new high-end processor the Snapdragon 8+ Gen 1, following its rivals like Motorola, Xiaomi, Samsung, and Huawei. The phone maker’s market campaign focused on attracting consumers who prefer a stronger camera system and dual-fingerprint recognition (on both internal and external displays).
Details: The Vivo X Fold+, compared to its predecessor, has similar specs in terms of body size, case design, weight, display, and cameras. But the new generation is equipped with a new processor, better charging speed, and an improved battery.
Context: Vivo has so far focused on selling foldable phones in China, it has yet to launch any foldable phones overseas, nor has it revealed any plans to do so.
TikTok owner ByteDance bolstered its lineup of VR headsets on Thursday by unveiling the new Pico 4 and 4 Pro as strong alternatives to the Meta Oculus, with prices starting from 429 euros ($421.79).
Why it matters: The Chinese tech giant is clearly eyeing the VR market, and this is its first VR product since acquiring the Beijing-based firm Pico last year for RMB 9 billion ($1.27 billion).
Details: The Pico 4 will be available in Japan, South Korea, and 13 European countries, including the UK, France, Germany, and Spain, shipping from October 18. And it will come to China, Singapore, and Malaysia later this year. A US release has not been announced.
Context: Founded in March 2015, Pico is a major VR hardware and services vendor. In addition to its products for the consumer market, it also provides services for enterprise clients in the fields of education and healthcare.
Top GPU maker Nvidia told Caixin (in Chinese) on Wednesday that they will provide alternative GPU products to Chinese clients as many of them face imminent supply issues after the US government recently announced export bans on cutting-edge chips.
Why it matters: The export ban from the US was aimed at limiting China’s expansion in AI and other tech fields that need high-performance GPU chips.
Details: Jensen Huang, CEO of Nvidia, told Caixin and other media outlets that the alternative GPU chips will be built with their new Hopper architecture for Chinese clients, which enables them to sell the hardware without violating the export ban.
Context: The mainland Chinese market accounted for 26% – or $7.11 billion – of Nvidia’s global revenue during its 2022 financial year, which ended on Jan. 30, 2022.
In his speech during Wednesday’s virtual event, Allan Gabor, president of Merck China and executive vice president of Merck Electronics, shared his insights on the AI and biomedicine industry and further explained how the firm uses AI to accelerate the biotech industry in healthcare, life sciences, and electronics.
On Wednesday, the BEYOND Expo 2022 opens online at BEYOND Metaverse. As Asia’s largest and most influential tech event, the Expo will have more than 40 talks and panel discussions where leaders and experts across sectors dive deep into the topics of consumer tech, health tech, global investments, sustainability, and Web3.
Please find below the transcript of the opening day speech from Allan Gabor, president of Merck China, and executive vice president of Merck Electronics. The following transcript has been edited for clarity:
Hello, my name is Al Gabor. I am the President of Merck China. I am also leading our Electronics business here in China. Thank you for inviting me to the BEYOND MetaExpo. Pleased to meet you all on this innovative new platform BEYOND.
I am delighted to share with you some insights on artificial intelligence and the biomedicine industry and hopefully also share some of the excitement that we at Merck China feel about this new frontier in healthcare. As a global leading science and technology company, Merck embraces Artificial Intelligence both in our daily operations and in our R&D efforts.
This comes natural to us, because with our three business sectors – healthcare, life sciences, and electronics – we have a broad portfolio that is ideally suited to identify and use synergies. Merck is very interested in learning from nature and AI is helping us to achieve this better than ever before. Biology is converging with engineering sciences like chemistry, artificial intelligence, and material science. Having expertise in all of these fields, Merck is ready to connect the dots and be a reliable partner for your business.
AI has the potential to accelerate the discovery of the next generation of drugs and therapies. This is exciting because it holds the promise of more personal and targeted therapies, which can make them more effective and more accessible for patients.
For Merck, our scientists see AI´s capability to analyze pre-clinical data and literature for drug discovery and biomarker identification. We regard the application of AI as a key digital strategy to unlock great benefits for our medicinal R&D, especially for compound optimization, molecule & compound testing, and processing.
And we are not only harnessing the power of AI in our own research – Merck´s Life Science business also empowers the research & production partners. We support new biomedicine research with innovative materials, equipment, and new AI-powered technical solutions.
Merck is applying the advancements in AI to the compound screening of hundreds of millions of drug candidates. With the support of AI learning and data, we help our customers and partners to save time and optimize their own drug discovery and manufacturing.
In our electronics business, a fast-growing part of the Merck business matrix, we are actively involved in further innovating existing computer architectures. And with our innovative materials, we enable the new semiconductors and future technologies that are needed for this AI revolution in healthcare.
We are proud to provide critical materials for Neuromorphic chips and quantum computing. They are among the more than 150 products we provide to around 100 chip makers across China, covering their entire wafer fabrication and packaging processes.
Merck China is more than doubling its investment in our Electronics business, with at least another RMB 1 billion ($140 million) before 2025, with a focus on the chip manufacturing industry. Globally, our Merck Group will invest more than 3 billion euros ($2.98 billion) by 2025 in this same area.
At Merck, we are already using AI in many fields and deploying it to an increasingly greater extent. We’ve formed a partnership in the field of AI-based active ingredient research with Iktos of France to accelerate drug discovery by automatically designing virtual novel molecules with the desired activity to treat a certain disease.
Here in China, Merck was a launch partner of Insilico’s AI-platform Chemistry 42. It is ground-breaking, as small molecule discovery becomes much faster.
In collaboration with major industrial companies, renowned research institutes and universities, Merck has established an innovation platform called KEEN. Under KEEN, specific applications have been developed that are applying AI. For example, self-optimizing production units.
We also invest in smart AI technologies in our own production. We currently have a pilot project running in collaboration with Siemens.
As you know well, Biomedical Sciences has a very broad range and deals with various disciplines of medical research such as genetics epidemiology, clinical epidemiology, clinical virology, and medical microbiology.
Natural and engineering sciences are converging at a fast pace in our quest to better understand human health and diseases – like the fields of anatomy, cell biology, biochemistry, microbiology, genetics, molecular biology, immunology, mathematics, statistics, and bioinformatics.
All this interdisciplinarity results in the creation of huge data sets, and that makes AI so immensely helpful for biomedical science and for the development of the new treatment technologies that are currently emerging.
One example: our scientists are actively experimenting with Organs-on-a-Chip solutions. While research is moving from in-vivo to in-vitro, complex algorithms help to process the huge amount of data generated.
While scientists and human know-how continue to be needed, AI has the fascinating capability to estimate lots of results without direct human interaction. It can help with text mining, patient-centric information retrieval, biomedical text evaluation, diagnostic assistance, clinical event forecasting, and many other tasks.
At Merck, we believe that artificial intelligence is poised to broadly reshape medicine and improve the experiences of both clinicians and especially patients. Still, tremendous challenges remain for all of us actively starting to use AI. The biggest one is to create the necessary user trust in AI systems and how the training data sets are composed.
That is why Merck is also actively involved in developing the proper management systems to use data responsibly and equitably, including ethnic monitoring. At Merck, we have confidence in the power of artificial intelligence and we believe that it will contribute to a brilliant future.
]]>On the opening day of BEYOND Expo 2022 on Wednesday, Zheng Xuexuan, chairman and president of China State Construction Engineering Corporation, shared his ideas on the approaches to high-quality innovative development, contributing to China’s carbon neutral goals, and how his firm has demonstrated the benefits of rapid construction in the building of Covid-19 facilities across the country.
The BEYOND Expo 2022 opened online at BEYOND Metaverse on Wednesday. The Expo will have more than 40 talks and panel discussions where leaders and experts across sectors dive deep into the topics of consumer tech, health tech, global investments, sustainability, and Web3.
Please find below the transcript of the opening day keynote speech from Zheng Xuexuan, Chairman and President of China State Construction Engineering Corporation. The following transcript has been edited for clarity:
Hello, everyone!
BEYOND is one of the largest and most influential international technology fairs in Asia, and it is a great honor for me to be invited to participate in this technology event.
First of all, on behalf of China State Construction Engineering Corporation (CSCEC), I would like to extend warm congratulations on the opening of this expo!
I would like to take this important opportunity to express my sincere appreciation to all the friends from all sectors of society who have cared for, supported, and helped CSCEC for a long time.
Innovation is the primary driving force for development.
Since the 18th CPC National Congress, General Secretary Xi Jinping has placed innovation at the core of China’s overall development, attached great importance to scientific and technological innovation, and put forward a series of new ideas, new judgments, and new requirements.
CSCEC insists on following the important discussion of scientific and technological innovation put forward by Xi. We have fully implemented the new development concept, thoroughly implemented the strategy of innovation-driven development, accelerated technological innovation in construction, and worked hard to promote high-quality development.
Engineering construction is an important activity for human beings to make use of nature, transform nature, and create life.
We always regard advanced construction technology as the foundation of our existence and our business. Persisting in meeting the urgent and long-term needs of the industry, we will push forward key and core technologies and strive to build the strong core competitiveness of enterprises.
We have mastered the world’s leading construction technologies such as single building translation, large roof sliding, and complex steel structure production and construction. We have successfully developed major construction equipment such as aerial building machines, vertical shield machines and 10,000-ton press, and have taken the lead in breaking through kilometer-level super high-rise construction technology. The domestic three-dimensional engineering image software independently developed by us has been promoted in the market, and the carbon fiber thousand-ton anchor cable system has been successfully applied in bridge engineering construction.
Thanks to these accumulations, we have invested in more than half of the world’s super tall buildings over 500 meters, more than 90% of the world’s super tall buildings over 300 meters, three-quarters of key airports and satellite launch bases, one-half of nuclear power plants, and one-third of urban integrated management corridors, ranking the top of ENR global contractors for seven consecutive years.
Construction industrialization is an important trend in the development of the construction industry, which is of great significance to the improvement of construction efficiency and construction quality.
We have taken construction industrialization as an important development direction, planned layout in advance, gathered superior resources, and given full play to the leading and exemplary role of central construction enterprises.
We have pursued a new generation of industrial construction technology, including a series of building industrialization technology systems and product systems and Modular Integrated Construction (MiC). The total production capacity of prefabricated building design exceeds 5 million cubic meters per year, and more than 90% of processes can be integrated into factories, truly realizing “building houses like cars”.
Prefabricated buildings and rapid construction technology have played a key role in the national fight against the Covid-19 epidemic.
We built the 1,000-bed Huoshenshan Hospital in 10 days and the 1,600-bed Leishenshan Hospital in 12 days and completed the construction task of the Hong Kong Infection Control Center project of North Lantau Hospital, assisted by the Central government in four months, according to permanent construction standards. This year, we have completed the construction of 10 anti-Covid-19 projects in Hong Kong at the fastest pace. For three years in all parts of the country, we accumulated construction of more than 700 anti-epidemic facilities.
At the General Debate of the 75th session of the United Nations General Assembly, General Secretary Xi Jinping announced China’s goal of achieving a carbon peak by 2030 and carbon neutrality by 2060.
Urban and rural construction is one of the main areas of carbon emissions, and effectively reducing the carbon emissions of the whole industrial chain in the construction field is an important link to achieving the “double carbon” goal.
We adhere to the concept of “ecological priority and green development”, which is deeply integrated into the whole process of investment, planning, design, construction and operation.
We have led the formulation of more than 10 national and industrial green construction standards, participated in the formulation of a number of policy documents, and developed a series of innovative products such as ultra-low energy consumption and zero-carbon buildings. It has promoted more than 100 green construction technologies in the industry, vigorously promoted the emission reduction and resource utilization of construction wastes, and basically formed a technology research system covering the whole construction process and the application service capability of the whole industrial chain.
In recent years, we have invested in the construction of green and low-carbon buildings represented by Xiongan Citizen Service Center and an ecological new city represented by Xi ‘an Happiness Forest Belt. Overseas, in the construction of the Brunei Tamburong Cross-sea Bridge project, the “non-landing” construction process was created to solve the problem of environmental protection of local primitive forests, swamps and wetlands.
With the continuous penetration and wide application of a new generation of information technology, the competition rules of the construction industry may change dramatically, and traditional construction enterprises must accelerate on the road to digital.
We adhere to the transformation and development of digital empowerment, strive to build the Internet of the construction industry, and deeply explore the integration and innovation of big data, artificial intelligence, 3D printing and other technologies in the field of construction. We have realized the practical application of building information model (BIM), smart factory MES system and smart site platform, and built the world’s first digital production line for building curtain walls and the first intelligent manufacturing production line of heavy steel structure.
We have vigorously promoted industrial digitalization, laid out construction industrial robots, smart parking, smart venues and other fields, and cultivated and built an e-commerce platform called “Cloud-building-network” with an annual transaction volume of over one trillion yuan, ranking first in the centralized procurement business of similar central enterprises.
Science and technology lead the era, and innovation builds the future.
From this new starting point, we will earnestly learn and make good use of the important achievements of this Expo, focus on frontier areas, increase innovation efforts, strive to provide more high-quality construction products and services to society, strive to expand a broader space for happiness, and contribute to the wisdom of CSCEC for high-quality economic and social development.
To conclude, I wish the expo every success, and I wish you all good health and all the best!
Thank you very much.
]]>Huawei’s cloud services arm announced plans to expand into two new international regions on Monday. Indonesia and Ireland will soon be covered by Huawei Cloud, the unit’s CEO Zhang Ping’an announced at the company’s Connect 2022 event in Bangkok.
Why it matters: Huawei Cloud has grown to become the second largest cloud service provider in China in the second quarter of 2022 by spending, according to Canalys. As Huawei has encountered setbacks with its attempted expansion into the US and some European countries, exploring alternative overseas markets could be a major opportunity for new growth for the Chinese telecoms giant.
Details: Huawei Cloud launched its “Go Cloud, Go Global” plan on Monday, which will focus on Everything as a Service (XaaS) and look to expand Huawei’s international footprint.
Context: The Global Infrastructure as a Service (IaaS) market is currently dominated by Amazon and Microsoft, with the two controlling 60% of the market by revenue in 2021, according to Gartner, a US consultancy. Huawei ranked fifth according to the same data, with a 4.6% market share and $4.19 billion in revenue in 2021.
Chinese tech majors Tencent and ByteDance were the top-grossing publishers in global mobile app stores for the first half of 2022, according to a report by business insight firm Sensor Tower.
The global mobile app market is highly centralized, with 91% of revenue coming from the top 1% of publishers. Over the years, such centralization has been shrinking; the market share of the top 1% has hit its lowest point since 2019.
Why it matters: Tencent and ByteDance have dominated the global mobile markets for years with their trending game titles and the internationally phenomenal video app TikTok. The two majors have invested heavily outside of China, launching new services and acquiring studios in recent years.
Details: By analyzing 900,000 publishers on the Apple App Store and Google Play, Sensor Tower found that the top 1% of publishers accounted for 79% of all downloads and 91% of revenue on the two platforms in the first half of 2022. The remaining 99% shared 21% of the market.
Context: Revenue from mobile apps saw a 2.2% decrease semi-annually (in Chinese) in the first half of 2021, a total of $65 billion less than in the second half of 2021. It is the first fall in revenue since 2019, according to Sensor Tower.
Major Chinese phone vendor Vivo launched its new V25 Pro overseas last month, targeting mid-end markets. Launched in 2015 with the V1, the V series is a product line exclusive to overseas regions. The V25 series is priced from $310 to $550 and sell in more than 20 markets across Southeast Asia, South Asia, Latin America, the Middle East, and others.
The new phone has powerful cameras and a unique light-changing design on the body case. Its core performance specs are also enough for daily use. Yet there are notable shortcomings with its system user interface design and gaming performance. It’s a phone for people who prioritize good camera functions, but may not be ideal for an avid gamer on the same budget, which Xiaomi’s Redmi and Realme might have more competitive offers.
The V25 Pro’s back case has a shiny effect courtesy of its processed glass material. It reflects light in a “bling-bling” way. According to Vivo, the phone adopts a color-changing technique that alters its color after exposure to sunlight or ultraviolet (UV) rays for ten minutes. The function offers users a way to customize the back case by blocking the light with stickers. The parts exposed to light will present a deeper blue, while the rest remains in the original light blue like a watermark. The eye-catching effect is temporary and disappears within minutes depending on the lighting conditions. Vivo also didn’t provide stickers or other tools to help with such customization.
The phone’s camera area in the back is well-designed, with lenses less prominent than rivals. Also, the phone adopts the popular dual-curved design, which gives it a great visual impact and makes for a good holding experience.
The Vivo V25 Pro’s cameras are among its most impressive features. The phone is equipped with triple back cameras: a 64 million pixel ultra-sensing camera, an 8 million pixel super wide-angle camera, and a 2 million pixel macro camera. The ultra-wide and macro cameras have much lower resolutions than the main one.
The cameras can capture realistic tones and deliver a natural look without being too plain.
It doesn’t over-process pictures, like up saturation and contrast levels for a more vivid and digitally sharpened look. The phone’s algorithm shows a preference for restricting highlights to keep more detail, offering a well-balanced tone. This could be a differentiator for users wanting a more realistic rendering.
The cameras also perform well in low light, capturing pictures fast and preserving details, thanks to its algorithms and optical image stabilization tech. The phone also comes with rich features for vlogging, such as dual view and fast autofocus.
The phone comes with Funtouch 12, an Android-based system. But Vivo’s customization of this UI has a dated feel and is a bit disappointing.
Most phone brands design their own home widgets like clocks, weather, and calendar. The system’s icon designs lack contrast in color and pattern, making it hard to distinguish their functions, while the names lack shadows and darkening effects to stand out from the wallpaper sometimes.
Vivo’s theme store can upgrade the looks but will cost money.
Built with a mid-end processor, MediaTech Dimensity 1300, and 12 GB RAM (plus eight RAM more offered by software), the phone can handle most daily tasks with ease.
We attempt to open as many apps as possible from the Google Play store and find the phone can handle over 20 frequently used apps running in the background and can resume any of them in an instant. Due to its high-speed UFS 3.1 storage chip, the phone is also fast when opening new apps.
The phone can handle playing casual game titles that demand less performance, with no overheating or frame-dropping issues. But with a 6nm mid-end processor, don’t expect the phone to handle heavy work for extended periods.
When we played the demanding open-world game Genshin Impact with the highest setting, the CPU temperature reading from popular benchmark app Antutu shot up from 40 degrees Celsius to almost 80 degrees Celsius. The frame stability was fine, but the display emitted a lot of heat, which makes it uncomfortable to hold while playing.
Battery and charging performance is enough for daily use, too. The Vivo V25 Pro has a 4830 mAh battery with 66 W maximum charging wattage. We tested it with 20% battery life remaining, and within the first 10 minutes, it had charged to 47%. The phone took another 35 minutes to be fully charged, not as fast but still at an acceptable speed.
The battery can last reasonably long if you don’t push it too much. In the Genshin Impact testing, 50% of the battery life was gone in just two hours of gameplay. But left alone, with no heavy apps running, and the phone’s battery could last for more than two days.
The Vivo V25 Pro is a good budget choice as a primary phone for daily use. It has a large battery to support all-day use, considerable RAM for heavy multitasking, and good cameras that deliver realistic shots. And yes, it has a unique back case that can change color for a short period.
But it struggles to handle high-performance game titles, and some may find the system UI uninspiring. For people looking for higher performance within the same budget, the phone faces some serious competitors.
Here’s our main takeaways on the phone:
]]>READ MORE: Honor 70 review: a mid-end phone with style
Chinese video platform Bilibili reported on Thursday revenue of RMB 4.9 billion (US$732.9 million), a 9% yearly increase for the second quarter of 2022, continuing its trend of slowing growth. The firm’s net loss narrowed and saw an increase in monthly active users (MAUs).
Why it matters: Bilibili continued to operate on a loss since it went public on the Nasdaq in 2018. The pandemic resurgence and month-long lockdown in Shanghai, where Bilibili is based, have hit the company’s income. Slowing growth will make it harder for the company to achieve its goal of turning a profit in 2024.
Details: Bilibili has seen revenue growth slowing since the second quarter of 2021, even as its MAU numbers during the same period have stayed strong, with about 30% yearly growth each quarter.
Context: Bilibili has a strong user retention rate due to its heavy focus on catering to a community feeling. CEO Chen Rui said at a company anniversary event in June that 65% of the first batch of users registered in 2009, when the platform was launched, are still active on the platform.
Chinese telecom giant Huawei introduced its new high-end Mate 50 phone series at a Tuesday product release event. The series features camera and glass upgrades and supports satellite texting.
Why it matters: Huawei’s new lineup offers several surprising features, with a notable breakthrough in cameras and satellite communication.
Details: Huawei’s new Mate 50 lineup is priced from RMB 3,999 to RMB 12,999 ($573.53 to $1,864.3), covering a wide market range. The Mate 50 standard, Pro, and the luxury RS model (with a Porsche-inspired design) are built with the newest high-end processor, Qualcomm Snapdragon 8+ Gen 1 4G. The lowest-priced Mate 50E model comes with a mid-end processor, Qualcomm Snapdragon 778G 4G. The standard, Pro, and E models have 8 GB RAM, while the RS model has 12 GB RAM.
Context: Huawei is the fourth largest mobile vendor after Xiaomi, accounting for 6.03% of the global smartphone market as of August 2022, according to StatCounter, an analysis website started in 1999.
Chip manufacturer TSMC will use chip design software from US firms to produce 2nm chips and expect to reach volume production of 2nm chips in 2025. The chipmaker increased its revenue growth target from between 24% and 29% to between 34% and 36% this year due to high utilization of production capacity.
Why it matters: TSMC and Samsung have been racing to reach volume production of 3nm chips first. On Aug. 30, TSMC claimed the 3nm chip will be put into volume production this month, despite encountering difficulties. As a result, the 2nm node is becoming the next competitive point for top chip makers.
Details: TSMC said they would achieve volume production of 2nm chips in 2025 and will use electronic design automation (EDA) software from the US to produce 2nm chips, according to UDN.
Context: Last month, the US banned mainland China from accessing EDA software for advanced chipmaking. Meanwhile, the UK declined an acquisition of a local EDA firm by a Chinese company last month due to concerns about potential use by China’s military.
Update: We have updated TSMC CEO’s name from Wei Zhejia to C.C. Wei.
]]>Chinese phone maker Honor released the Honor 70 for the overseas market on Saturday at Internationale Funkausstellung Berlin (IFA) 2022, an industry exhibition in Germany. The model was first launched in China earlier this year and was the best seller in mid-priced phones during the 618 shopping holiday, according to Honor.
Honor 70 is a primary product line with a mid-range price tag and specs, compared to its high-end Magic series and lower-priced X series.
For the review, TechNode is testing the Honor 70 Crystal Silver with 8 GB RAM and a Qualcomm Snapdragon 778G Plus processor.
The phone is targeted at users who have a tight budget but a preference for stylish design. It offers solid performance in terms of core specs and surprised us a little in some aspects.
The phone adopts dual-curved edges on the display with a frame in the middle, which makes it feel frameless.
The crystal silver colorway we have has a crystal-like back case. The base color is mixed with sparkly “stardust” with a gradient from the top to the bottom. Using a faceted design usually seen in diamonds and other jewelry, the case reflects surrounding light while still giving a comfortable holding experience.
In keeping with the sleek design, the back cameras are contained within two circles: one with two cameras and the other with one camera and a flash. The black surface of the two circles also contrasts pleasingly with the silvery back of the phone.
We are pleasantly surprised by the phone’s stylish user interface. The wallpaper corresponds with the phone’s body color, the icons are well-designed, and the widgets (clock, calendar, weather, and search bar) are composed in a comfortable and appealing way.
The interface uses vivid but not overtly bright color while incorporating smooth and natural motion and transition animations. In some cases, such as shutting down background apps, the animations are even a little playful, like giving out a flipping motion. The phone’s high refresh rate of 120 HZ display works well with the system animation, leveling up the user experience compared to previous models.
From the look of the spec, Honor 70’s 8 GB RAM and a mid-end processor, the Qualcomm Snapdragon 778G Plus, the phone may not seem built to handle heavy work such as playing games that consume a lot of memories and put pressure on processors. But after trying it with a few different types of games, the phone responds relatively well.
We started by trying out casual games like Subway Surfers, an endless runner game. The phone runs quite well without dropping any frames and we barely feel any heat from the device.
We then push it further by running the demanding roleplaying game Genshin Impact. When it runs this title, the system kills almost all other background apps, with its 8 RAM creating a bottleneck. And with the highest graphic preset of 60 fps option on, it runs smoothly most of the time, but it does drop frames when loading complex scenes or if you move your character quickly around the game.
Meanwhile, playing Genshin Impact on the phone sees the CPU temperature rise from 30 to 47 degrees Celsius, according to a reading from Antutu, a popular Chinese phone benchmark app.
That temperature may seem acceptable, but we felt it was a bit too hot to hold when playing games in summer. For such memory-consuming game titles that may push the processor to its limits, you could consider lowering the graphic settings for a better experience.
The phone can handle ambitious tasks, but our advice is to not push it too hard. As for everyday apps, the specs are more than enough. The phone’s 8 GB RAM (plus 2 GB extra offered by an effective feature allowing storage to be added to RAM) can run more than 10 lightweight apps in the background at the same time.
The Honor 70 has a triple back camera module and single front camera, with rich and playful features for vlogging and shooting. Two of the back cameras support 50 million-plus pixel resolution.
We took it out for some shots and the camera did a good job, capturing some nice colors and proper exposure even in complex scenes with large shadows.
Lowlight scenarios are challenging for phone cameras due to the tiny size of the sensor which directly determines the image quality. We test the Honor 70 in a darkened art gallery and the phone does quite well, capturing detailed images, with a good balance of highlights and shadows; the white balance is accurate most of the time. The camera also has a night mode and a Macro feature.
Its Aperture Mode, which can create partially-blurred bokeh images, works well. Shots with this mode may not look as flawless as true optical bokeh driven by a larger sensor and aperture, but this mode nevertheless exceeds our expectations of what a phone camera can do.
A highlight feature is Multi-Videos, which offers a great filming experience for vloggers and e-commerce livestreamers when looking to demonstrate an item or experience. It allows you to use both the front and back cameras at the same time and display the image in a split screen. It can quickly catch and focus on the main subject with options to adjust the zoom and beautify the image.
The Honor 70 adopts a 6.67-inch punch-hold OLED display, with 2400 x 1080 resolution. The display works nicely when we test it with HDR video samples. This mode shows off the benefits of the phone’s OLED display which offers great contrast and definite black without lighting up the pixels.
The device tends to display colors in a cooler tone if you compare its display with that of other phones or juxtapose it with a white wall. You may get used to it after a long time using it, but it could make you feel slightly uncomfortable if you use multiple devices at the same time.
The model we tried had a 4,800 mAh battery, supporting 66 W charging with the charger that comes with the device. The battery life won’t be a concern if you don’t overburden it. The 66 W charging speed is another compromise, as many other similarly priced phones in China now offer 150 W or even 200 W high-speed charging speed.
However, for the average user, the 66 W charging speed should be plenty: it can still fully charge this phone up from 20% in less than 40 minutes.
The Honor 70 is a stylish choice for vloggers and fashionistas on a tight budget. Its core specs can support everyday apps quite well and even deliver in some demanding scenarios.
However, it does have certain compromises as a mid-end model, in particular with regards to its display, charging speed, and cameras.
Even so, we are still impressed by its rich camera features and elegant design, including both the body and the user interface. In short, here are our major takeaways:
Major Chinese phone vendor Oppo released ColorOS 13 in China, an operating system for phones made by Oppo and its sister brands OnePlus and Realme, at the 2022 Oppo Developer Conference (ODC) on Tuesday, following the announcement of the overseas version on August 18.
ColorOS 13 is based on Android 13, an open-source project led by Google. It inherits the original Android security pitches and bottom optimization but also introduces special features and localization through partnering with local firms. One particularly notable feature – Pantanal – allows for better collaboration between devices by offering a closer connection and reallocating resources.
Here are the key updates worth checking out.
A major update – with version numbers increasing in integers comparable to iOS 15 to 16 – generally means a fresh look in the new system’s user interface (UI). In the past year, Apple and Google haven’t introduced any major UI redesigns for Android 13 and iOS 16, so Oppo’s visual update makes it stand out among its rivals.
ColorOS 13 introduces a new UI design style called “Aquamorphic Design.” The update is inspired by the concept of water, aiming to create “a fluid, vibrant, and inclusive UI” from animation to component design. The colors and patterns are also based on the changing light between sunrise and sunset by the sea.
The new system has a card-style composition for increased accessibility, which looks cleaner and more friendly to use. Also contributing to the fresh feel, Oppo has launched a new font with a wider face that is easier to read. The new OS also introduces adaptive layouts optimized for devices in different size and statuses such as foldable phones and tablets.
Android’s background app running strategies left it a historical issue of how to allocate resources, including CPU time and RAM. Oppo is trying to further optimize system fluency by scheduling computing and RAM resources, prioritizing important tasks, and limiting greedy apps from running in the background via its algorithms to achieve a better balance between performance and power consumption.
It does this through its “Dynamic Computing Engine,” a system-level piece of technology formed from four computing engines that can increase battery life by 4.7% and performance by 10%, according to Oppo’s announcements at the event. The OS also aims to maintain more apps running in the background so that users can switch between them without a reboot or long wait.
As part of the new ColorOS, Oppo also revealed Pantanal, a cross-platform system which explores how to break the boundary between devices for better collaboration. The system can keep users in the loop of schedules on other devices via information from multiple devices such as enhanced Google Glance and Siri Advice. For example, it can remind users of a booked flight or the status of a coming taxi on multiple devices. Oppo has partnered with notable Chinese firms such as Li Auto, Tencent, Alipay, and Xiaohongshu for easier cross-device collaboration with Pantanal.
What really distinguishes Pantanal, however, is that the platform can not only handle data and information, but can also allocate computation and algorithm resources from multiple devices, including vehicles, phones, and tablets, to handle tasks like video creation.
It also extends connectivity to vehicles, offering more immersive in-car experiences such as using multiple car cameras to start video phone calls or running phone apps through the central vehicle console. Oppo has announced a partnership with Chinese automaker SAIC Motor as part of its moves into vehicle connectivity.
For privacy and safety, ColorOS 13 comes with a feature that can erase sensitive information on a screenshot from chat apps like WhatsApp and Messenger. It also has a function to prevent unsafe apps from running, like Google Play Protection, using algorithms assisted by real humans.
ColorOS also includes an animation emoji feature called Omoji, similar to Apple’s Memoji, with a style that echoes the new UI. Users can create their own avatars, which can then be used to present or livestream in certain apps.
The update also features a new Meeting Assistant function for online meetings. The assistant can prioritize wireless data packages to provide a more stable connection, and enables users to capture text from the screen to make notes. It can also convert forms from the screen to common files like Excel sheets or PPT slides.
ColorOS 13 is now accessible via a beta program and will officially roll out to over 40 models this year, including OnePlus phones in China.
The new OS is one of the major phone operating systems in China, competing with Xiaomi’s MiUI and Huawei’s Harmony OS. The system sees major updates every year that typically follow Google’s original Android version for its Pixel phones. According to Oppo, the system has reached 500 million monthly active users globally.
]]>Major Chinese chip maker SMIC announced on August 26 that it will invest $7.5 billion to build a new plant in Tianjin, the neighboring city of Beijing, to produce 12-inch silicon wafers at a rate of 100,000 pieces per month.
The new factory will focus on mature nodes, ranging from 28nm to 180nm, widely used in fields like electric vehicles.
Why it matters: As a major contract chip maker in China, SMIC could help northern Chinese regions develop in the semiconductor industry by building a new factory in the area. The eastern city of Shanghai and its adjacent Yangtze River Delta region traditionally have a strong advantage in semiconductor supply chain and talents.
Details: SMIC reached an agreement with Tianjin authorities to build the 12-inch wafer factory, a primary size for chipmaking.
Context: SMIC has three 12-inch wafer factories under construction in Shanghai, Beijing, and Shenzhen. The company also has four 12-inch fabrication facilities under construction in Tianjin, Shanghai, Beijing, and Shenzhen, according to the firm’s website.
Chinese gaming giant Tencent announced this year’s winning indie games from its Game Without Borders Game Awards (GWB) in mid-August. In its fourth year, the Award is organized by GWB, Tencent’s indie game incubator, and grants cash prizes (up to $72,982) and other benefits to promising Chinese indie game developers.
Developed by small teams, indie games tend to be less profit-oriented because some developers make them out of passion. Nonetheless, some Chinese indie games can become a hit, such as horror titles like Paper Dolls and Firework, which contain traditional Chinese horror story elements.
The Award selected 21 titles this year. TechNode highlights five notable games from the list. None of the five titles has an approved gaming license, but Chinese players still have a chance to play them via Steam on desktop.
Gold Award in card game
The title is an online deck-building game that allows players to become “ancient Chinese gods” as they progress in the game.
The game is designed with ancient Chinese styles and fictional characters. Previously, a famous Chinese card game called Legends of the Three Kingdoms became a big hit for referencing the Chinese historical novel Romance of the Three Kingdoms, a war period towards the end of the Han dynasty (A.D. 220 to 280). The Yi Xian game is a new attempt to explore different storylines from ancient China.
Players need to build a new deck from scratch in every game. Decks can be strengthened by changing cards, with the goal of building more powerful routines to defeat opponents and win. The gameplay looks like a combination of auto chess and traditional card games – while it is based on cards, it also includes strategic aspects similar to auto chess, like eliminating players through selection or competition to enhance the gaming experience in multiplayer.
Hangzhou-based Mo Ri Studio (our translation) developed the game, which also won the Award for games with the most business potential.
The game also has a notable publisher, GameraGame, which has introduced many well-known gaming titles that have previously excited the gaming community, including Firework and Dyson Sphere Program, two famous indie games. The title has closed its public testing. Tencent told TechNode that the game is coming to Steam in the fourth quarter of this year.
Silver Award in puzzle game
Murders on the Yangtze River is a detective game set at the end of the Qing dynasty (1912) and developed by OMEGames Studio. Players will find out the hidden truths by solving fictional cases.
The gameplay seems similar to its rivals. Players must find clues and solve riddles to figure out the whole picture of the story. The game art incorporated Chinese artistic style, with characters designed using ink painting.
OMEGames Studio is owned by a Beijing-based gaming firm, Beijing Unifly Culture Innovation, which was founded in 2012. The studio starts developing games in 2019. The title is the studio’s first piece, according to the studio’s page on multiple gaming platforms. The game title launched a demo in July, according to its Steam page. Tencent told TechNode that the title would launch in the first quarter of 2023.
Silver Award in roleplaying game
Nobody – The Turnaround is a roleplaying game that challenges players trying to survive in cut-throat city lives. Players will navigate the game as a newcomer to a metropolis, attempting to make a living.
According to its official introduction, the game is “set in a parallel world that echoes modern society.” It challenges players to manage resources and time in difficult situations. It also quantifies the main character’s health and emotion, with both requiring complex strategies to maintain good condition.
Developed by a lesser-known team at U.Ground Game Studio, founded in 2020 in Chengdu, the game is their first title and was announced in 2021. The game will also come to Steam in the autumn of this year, according to Tencent.
Bronze Award in puzzle game
Mercury Abbey is another puzzle-solving game. Its pixel art design and anthropomorphic animals might set it apart — a combination that is popular among people who like animation, comics, and games.
Players can roleplay two characters in the title to unravel the secrets behind the nursery by collecting clues and solving puzzles. The pixelated look offers a unique texture and feel. The game is also dialog-heavy, with much of the plot driven by the narrative.
Founded in 2020, the game’s developer YiTi Games was based in Chengdu. The developer launched a demo of this title in April and will officially introduce it sometime in 2023, according to Tencent. Mercury Abbey is also the developer’s first game listed on Steam. Like Yixian, it is also published by GameraGame.
Nomination in puzzle game
Five Dimensions is a puzzle-solving game with simple plots. The core gameplay is designed around the use of highlights and shadows to explore different dimensions on the screen. Players can manipulate the lighting and view angles to control the dimension changes and advance through the game.
The art style uses doodles and sketch looks, using a primarily monochromatic color scheme with a bright yellow accent.
The developing team comprises six members from top Chinese universities like Tsinghua University and the Central Academy of Fine Arts. The title is in a private testing phase and is estimated to launch on Steam in December of 2023, Tencent told TechNode.
]]>Read more: Chinese indie game developers recreate experiences of Alzheimer’s patients
Xiaomi launched the 12S Pro in China in early July. The phone is the mid-range offering in Xiaomi’s new 12S lineup (including the 12S, 12S Pro, and 12S Ultra), which updates annually and targets a broad range of mid-end to high-end users. The series is also the first Xiaomi phones to use Leica lenses. TechNode got a hold of the 12S Pro and spent a week using and testing it. Below are our thoughts on the phone.
The phone can be a solid choice as a primary daily device. The Leica-branded cameras can lure photography lovers, and the 12S Pro’s specs offer a quality entertainment experience. We would also recommend it to avid gamers and video watchers.
Xiaomi 12S Pro has curved edges from the back case to the front display, with a metal frame in the middle. The model has a higher width-to-height ratio, narrow enough to hold with one hand. The curved edges help reduce discomfort.
The back case is made of delicately frosted glasses, which, in combination with the white color, will be free from fingerprints.
The phone runs on Qualcomm’s latest flagship processor, Snapdragon 8 Gen 1+, and its power excels.
We played Genshin Impact, a detailed sandbox mobile game known for demanding high device specs, and it ran quite smoothly on the device under the highest graphic preset. After almost two hours of gameplay, it rarely dropped frames, and the phone temperature remained relatively consistent, with the back case feeling a little heated. Antutu, a popular Chinese benchmark app, reads around 36 degrees Celsius of CPU without workload and up to 50 degrees Celsius after two hours of Genshin Impact gameplay. The metal frame lets out more heat than the back case. We would describe it as “warm” rather than “burning.”
The phone has a 6.73-inch punch-hole display with 3200 x 1440 pixels. It also comes with a high 120 Hz refresh rate. A highlight we enjoy is the phone’s 20:9 display ratio. The phone offers a better experience for watching videos, considering most popular films display at around a 21:9 ratio.
The display can also achieve a 1,500-nit peak and a 1,000-nit general maximum brightness. A benefit lies in the outdoors experience with this phone, especially in bright, sunny environments. We tested it in such bright lighting conditions, and it offers decent display quality – the color looks normal, and the phone didn’t overheat when operating with the display set to maximum brightness.
The phone can also handle 4K HDR videos quite well in high-contrast scenes, showing details in both shadows and highlights. The dual speaker with Dolby Atom enhances the entertainment experience even further.
A key highlight of the phone is its Leica lens and software. The phone comes with various Leica color profiles. In Photo mode, there are two default options: Leica Authentic and Leica Vibrant. Both modes offer a sharp, vivid look. The colors are punchy yet not too overwhelming, keeping much of the detail in the dark and highlighted areas.
There are two additional monochromatic Leica profiles listed in the filters tab. The high contrast one – Leica HC – provides the distinctive black and white look that Leica is known for. If you are a fan of black and white photography and perhaps a fan of Japanese street photographer Daido Moriyama’s work, this would be a fun filter to explore.
When it comes to the portrait mode on the rear camera, however, Xiaomi 12S Pro’s algorithm-driven bokeh falls short. It couldn’t always recognize the edge of many subjects, including human hair and other complex scenes. Therefore, we recommend shooting at a lower aperture to improve this issue.
The phone has three rear cameras, offering a range from teleport to ultrawide with five times optical and 20 times digital zoom capacity. We shot in different zoom ranges from a single perspective to demo how it works.
We use the main rear camera to do a standard test of its optical performance in a 16:9 frame to put some extra pressure on the lenses. A notable takeaway is the slight chromatic aberration that appears in high contrast areas. But overall, the image is quite sharp from the center to the corners.
The front camera takes good quality shots most of the time and comes with a built-in beautification feature to offer choices, making you look better in pictures. However, the phone’s algorithm tends to overexpose when using the front camera, losing details in the highlights. After upgrading the system, the issue improved a little so it could be more of a preset preference issue rather than a bug.
The phone is equipped with a 4600 mAh large battery, with 120 W speed charge support. Battery life is not a concern for daily use, and we were surprised by the efficiency of the fast charging feature.
Furthermore, the phone’s battery holds up in demanding situations. For example, after two and a half hours of demanding gaming in the highest image quality, with 75% display brightness and Wi-Fi on, the battery went down 34%. Streaming a movie for two and a half hours using the same settings consumed 25% battery life.
Under these conditions, the phone should theoretically give you over seven hours of demanding gameplay and 10 hours of streaming video playback.
When it comes to charging, the 12S Pro took only 4 minutes to charge from 20% to 40%. From 20% to full, it only took 23 minutes using the 120 W charger that comes in the box, if you close all apps. The phone lets out surprisingly little heat during the charging process, which is impressive because such a high wattage charging speed will generally lead to overheating.
The phone’s large 12 GB RAM is a plus to the processor. We opened 20 apps, including news apps, social apps, and Chrome, and all work seamlessly in the background.
The phone system will automatically kill some inactive apps to save battery when you open power-intensive apps or games or lock the phone. But you can easily resume any previously opened app without much delay, thanks to its powerful processing and high-speed storage chips.
As a premium Android phone, Xiaomi 12S Pro has a low-key design and feels good in the hands. The performance, battery life, and charging capacity are more than enough for daily usage. You can play popular game titles like Diablo Immortal and Genshin Impact in the best image quality without experiencing frame drops. The new Leica camera system also performs well most of the time.
It should be a phone that fits the bill for most Android users for daily use. Below, TechNode summarized the main advantages and drawbacks of the Xiaomi 12S Pro.
Regional authorities in China’s central province of Sichuan said they will cut power supply to industrial factories for six days as the region suffers from heatwaves unseen in 60 years. The province saw a 25% surge in power consumption this year.
Why it matters: More than a dozen notable electronics and semiconductor manufacturing firms, including BOE, Foxconn, CATL, and Texas Instruments, have factories in Sichuan. The power cut will directly impact their production, affecting downstream firms like Apple, Tesla, and Nio.
Details: The power cut will go into effect from Monday to Saturday, with all factories in the 19 cities of Sichuan province asked to suspend production, including those listed on the so-called “protected whitelist.” But the level of impact seems to vary between companies.
Context: Sichuan is a top area for producing electronics in China’s midwestern region. It brought in RMB 1.5 trillion ($215.6 billion) in revenue in 2021, according to 21st Century Business Herald.
Chinese smartphone maker Xiaomi revealed a new foldable smartphone, the Xiaomi Mix Fold 2, at a product launch event on Thursday, boasting a folded thickness that is close to that of a regular phone, thanks to its new screen and hinge design.
Why it matters: The Mix Fold 2 is also intended as a challenge to foldable phone giant Samsung, which launched its new Galaxy Z Fold 4 this week. Xiaomi’s model is cheaper, has a larger battery and screen, and a much faster charging speed.
Details: With a price range of RMB 8,999 to RMB11,699 ($1,336 to $1,736), the phone adopts an inner folding design with a 6.56-inch outer display and an 8.02-inch inner screen. Both displays support 120 Hz refresh rate, 1,000 nits maximal brightness, and Dolby Vision.
Context: Xiaomi introduced its Mix Fold 1 in early 2021, with the model becoming the seventh highest-selling foldable phone in the world in 2021, just behind Huawei’s Mate X2, according to a report from Omdia.
Oppo-owned phone brand OnePlus introduced OnePlus Ace Pro on Tuesday, the latest device in its gaming lineup. The new phone is a local Chinese version of the OnePlus 10T announced on August 3 for sale in overseas markets.
Why it matters: Chinese smartphone makers are introducing high-performance phones at lower prices. The cheapest phone with Qualcomm’s newest high-end chip was the Realme GT2 Master Explorer Edition, released in July, and the OnePlus now provides a much larger RAM with the same starting price of RMB 3,499 ($520).
Details: Built with Qualcomm Snapdragon 8+ Gen 1 and unique cooling tech, the core performance can be promising for gamers, but the model also compromised other specs such as the display. Li Jie, president of OnePlus in China, said at the release event that the firm expects sales of its new Ace series to reach millions of units in China. For comparison, the brand’s number series sold 2.4 million units in China, 36Kr reported on Wednesday (in Chinese).
Context: The Ace series was a product line of Oppo. OnePlus took over this year and has since launched three models targeting gamers.
Chinese cross-border e-commerce platform Shein surpassed Amazon in app downloads on US mobile platforms for the first time in the second quarter of 2022, with 6.8 million downloads during the period, according to an August 7 Sensor Tower report.
Why it matters: While it still lags largely behind Amazon in monthly active users, Shein has gained popularity in the US with ultra-cheap pricing and a vast selection of fast fashion.
Details: Shein saw a 13% quarter-over-quarter growth in downloads while Amazon had a 7% fall compared to the first quarter this year, according to Sensor Tower.
Context: This is the third time that Shein has surpassed Amazon’s installations worldwide, but a first for the US market. Founded in 2008 in the eastern city of Nanjing, Shein began as a cross-border retail company and has slowly risen to the top of the field by focusing solely on overseas markets and offering extremely low-priced fast-fashion items.
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A hundred and forty-five Chinese companies made it to the 2022 Fortune Global 500 list released on Wednesday. The listed Chinese companies span a diverse set of industries, including energy, metals, technology, banking, and insurance. State Grid, China’s national energy provider, is the highest-ranked Chinese company on the list at number three, just behind Walmart and Amazon.
The revenue of these Chinese companies accounts for 31% of the 500 companies’ total revenue, surpassing the total revenue from US companies on the list (which is 30% of the total) for the first time.
However, Chinese companies’ profitability is still lacking compared to their counterparts. The average profit made by the Chinese companies on the list is $4.1 billion, much lower than the $6.2 billion average profit made by Fortune 500 companies.
Below, TechNode summarizes what you need to know about the five top-ranking Chinese tech firms from the list: Hon Hai Precision, JD.com, Alibaba, Huawei, and Tencent.
Ranking: #20
Founded in 1974, Hon Hai Precision is one of the world’s largest electronic assembling manufacturers and is best known for its Foxconn factories. Foxconn plays a vital part in Apple’s supply chains, assembling the brand’s Mac, iPhone, and iPad products. The company’s pivotal role was on show earlier this year, when China’s Covid lockdowns affected Foxconn factories and led to weeks of delays to some of Apple’s product shipments.
The firm started investing in mainland China in 1988 and has more than 40 plants in the region. The company’s imports and exports account for 3.5% and 4.1% of China’s total import and export volume respectively, according to its official website.
Hon Hai’s position on the Fortune list rose two places from 2021. It brought in $214.61 billion in revenue last year and saw 18% year-on-year growth.
Ranking: #46
JD.com was founded in 1998 and has grown into an e-commerce giant focusing on consumer electronics in China. JD’s revenue hit $147.53 billion last year, but the firm’s losses continue to expand. In 2021, JD.com lost $551.8 million, up 107.7% from the previous year.
In recent years, the company has accelerated its expansion in logistics infrastructure and made an overseas push. JD Logistics bought delivery rival Deppon for $1.4 billion in early 2022 and logistics infrastructure provider China Logistics Property Holdings last month. In January, JD also teamed up with Shopify to help international merchants sell in China on its platform.
The company is up by 13 places on this year’s Fortune list to the 46th.
Ranking: #55
A major Chinese e-commerce company, Alibaba has faced significant regulatory headwinds in China since late 2020. The group has also seen slower growth, partly thanks to more conservative consumer sentiment amid an economic downturn and China’s strict Covid control measures.
The company’s revenue in 2021’s fiscal year grew 25.6% to $132.94 billion, but its net profit saw a 56.4% decrease to $9.7 billion in the same period. Analysts also expect the firm to record its first-ever decline in quarterly revenue in the coming month.
Alibaba ranked 55th on Fortune’s list, eight places higher than last year.
Ranking: #96
Chinese telecom giant Huawei has fallen more than 50 places on Fortune’s international 500 list, dropping from 44th to 96th. The firm’s revenue also fell in 2021, with the figure down 23.6% on the previous year to $98.72 billion, but its profits grew 88.2% to $17.62 billion during the same period.
The US’s ban on Huawei’s access to 5G chips has stopped the firm’s rapid growth in smartphone sales and pushed it into pursuing a variety of a new projects including cloud services, IoT, and smartphone operation systems. It has also found a growth point in enterprise business, offering cloud and hardware solutions to companies. This sector accounted for 16.1% of its total revenue last year.
Ranking: #121
Tencent, owner of the ubiquitous messaging app WeChat and a global gaming giant, is also entering a slower growth period, thanks to China’s tighter regulations on gaming and monopolistic behavior.
Nevertheless, in 2021 Tencent earned $86.84 billion in revenue, up 24.3% year-on-year. Its profits increased 50.5% from last year to $34.85 billion.
Affected by China’s pause of gaming licenses and the country’s pandemic controls, Tencent has also been cutting down its workforce to control overheads. The firm turned to setting up studios like TiMi F1 for AAA-level title development and sought new profit growth in overseas markets in 2021. The firm’s overseas gaming business saw an impressive 31% yearly growth in 2021, according to its financial results.
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The US has stepped up its restriction on China’s access to chipmaking equipment, expanding it from tools that make chips of 10 nm to 14 nm process technology, effectively cutting China’s ability to produce advanced chips.
Why it matters: A further ban on the Chinese chips industry would disrupt the supply chains of semiconductor producers worldwide, as the country is an essential part of the global semiconductor industry, according to Peter Wennink, the CEO of semiconductor giant AMSL.
Details: On July 29, Bloomberg cited sources from two primary semiconductor suppliers, Lam Research and KLA Corporation, saying that the US Department of Commerce had informed them to stop supplying products to mainland China for making chips under 14 nm in the past two weeks.
Context: The US has been restricting the sale of equipment to Chinese firms to develop chips since 2020 and has sped up its effort in recent months. Last week, the two branches of the US congress passed the $280 billion Chips and Science Act. In addition, the bill will subsidize US semiconductor manufacturers and innovation and hope to strengthen its competitiveness in the crown jewel of modern technology.
Chinese telecom giant Huawei introduced the latest version of its HarmonyOS, a system for various smart devices, on Wednesday. The new HarmonyOS 3 system supports 12 different device types as the firm ambitiously looks to build its own closed-off ecosystem like Apple’s.
Why it matters: HarmonyOS, a Huawei-developed system originating from open-source projects, has amassed 300 million users since its launch in 2019. The third generation comes with more powerful features that connect different devices with one system while adding new local services such as a ride-hailing app.
Details: A key highlight of Huawei’s new operating system is a significant update of its cross-device integration feature called “Super Terminal.” HarmonyOS 3 is already open for public testing and will see a full rollout in September.
Context: In April, Huawei changed the name of its Consumer Business unit to Terminal Business, aiming to expand its focus from customer-facing business to enterprise and government businesses. The new HarmonyOS, along with new devices built with it, is part of this push to better serve customers with a variety of Huawei devices.
Major Chinese electronics manufacturer Anker introduced a new series of gallium nitride (GaN) chargers called GaNPrime at a release event on Tuesday. The new lineup offers fast-charging tech with higher charging wattage (up to 150 watts) and greater energy efficiency.
Why it matters: As a pioneer in charging tech, Anker managed to pack more power in smaller and lighter chargers. Its new 737 model, for example, supports 120W charging wattage, but the size is equal to most 60W chargers offered by Anker’s competitors.
Details: The new GaNPrime series includes six products for the overseas market, with charging wattage ranging from 65W to 150W and multiple ports for multi-device charging.
Context: Founded in 2011, Anker is a major Chinese electronics company best known for its charging products. As a pioneer in the GaN charger field, Anker became the top brand in this market with the most sales worldwide in 2021, according to a survey from Frost & Sullivan, which was cited by the company at the release event.
]]>Since last week, several major Chinese social media platforms, including the Twitter-like Weibo and TikTok sister app Douyin, began to test displaying the names of commercial agencies responsible for content production on influencer accounts’ profile pages.
Why it matters: The move comes three months after platforms began displaying users’ IP locations. It is part of Chinese authorities’ declared aim of building a “healthy online environment.”
Details: Douyin began displaying details of multi-channel network (MCN) on influencers’ profile pages on July 21. Weibo made the same move on Monday, showing the name of MCN responsible for commercial content. MCNs are third-party organizations that provide assistance and production services for online content creators and are a booming part of China’s digital economy.
Context: The MCN market in China recorded revenue of RMB 33.5 billion ($4.96 billion) in 2021 and is predicted to exceed RMB 54.5 billion in 2023, according to iiMedia Research.
Chinese tech giant Tencent is reportedly in the process of closing its digital collectible platform Huanhe after launching in August 2021, as Jiemian (in Chinese) reported, citing unnamed sources familiar with the matter.
Why it matters: Digital collectibles are China’s version of NFTs with some key differences, such as restrictions on the resale of these NFTs. Huanhe is supported by blockchains managed by Tencent and its partners. The end of Huanhe may also mean the end of collectibles bought on the platform, which has drawn buyer concerns.
Details: Chinese new platform Jiemian reported that Huanhe closed its external service earlier this month, citing an unnamed source.
Context: Since last year, major Chinese tech firms have launched NFT-related platforms. Apart from Tencent’s Huanhe, Ant Group launched a digital collectible platform called Topnod (JingTan in Chinese) on its AntChain in late 2021, while e-commerce giant JD launched an NFT platform called Lingxi last December.
]]>Chinese video platform Bilibili is restructuring its business units to boost profit growth, Chinese media outlet LatePost reported on Monday.
Why it matters: Despite strong growth in users and content offerings, Bilibili has been facing more pressure to turn a profit since it went public in New York in 2018. The extensive restructuring is aimed at helping the company become profitable by 2024, a goal first revealed by the company CEO Chen Rui at the fourth quarter earnings call in 2021.
Details: The overhaul mainly affects three core business units: commercialization, streaming, and content-related business. Six executives have either assumed new roles or left the company. In addition, Bilibili has also set up a new data center.
Context: Bilibili has continued to maintain user growth but is still a long way from turning a profit. In the first quarter, Bilibili had a 25% yearly growth in subscribers, while its net loss has widened 152% from last year to RMB 2.3 billion ($340 million). The firm is prioritizing commercialization as a critical task for this year, said its first-quarter earnings report.
A Chinese video creator on Bilibili recently built a 3D virtual museum of Chinese memes featuring popular Chinese internet memes from the past 20 years. The museum is accessible on VRChat with VR headsets or on PCs.
Siji, the museum founder, said he wanted to build the virtual institution to expose ordinary Chinese people to the metaverse concept and help them understand the next iteration of the internet. He decided to build the museum around memes due to their broad accessibility and existing popularity among Chinese internet users.
“The museum is not only for entertainment. It’s also an exploration of future online consumption trends, ” Siji wrote in the opening dedication for the museum.
The virtual museum took Siji, his friends, and volunteers three months to build.
The project has seven sections, arranged in chronological order to show 20 years of Chinese internet memes. They comprise the photo-heavy memes of the early 2000s, video-focused memes of the 2010s, and memes in a variety of formats from the last 10 years.
The collections on display take the form of pictures, text descriptions, and immersive 3D demonstrations that “restore” some famous memes.
One of the first items in the collection is a desktop computer from the 90s running on Microsoft Windows 95, a highly recognizable symbol to the first generation of Chinese internet users.
The museum also features some memes that originated in English language cultures and made their way to China, such as Rickrolling. The museum presents a localized version – “Gotcha” (“pian dao ni le” in Chinese) – by displaying an image that, in classic Rickrolling style, plays pop star Rick Astley’s hit “Never Gonna Give You Up” when a user clicks on it.
Another notable meme in the museum’s collection is “Are you ok?” This emerged from a phrase in a speech given by Xiaomi CEO Lei Jun in India in 2015. Lei spoke in English at the event, with his delivery leading to widespread amusement among Chinese internet users. Creators on Bilibili created a host of video memes based on Lei’s idiosyncratic phrasing. One of the main videos that helped spark the outpouring of Lei Jun memes now has over 41 million views (in Chinese) on Bilibili. Xiaomi ultimately embraced the meme, even using it as kind of slogan in the brand’s marketing (in Chinese).
Although the memes museum is built on VRChat, it first gained traction on China’s video platform Bilibili. An introduction video to the museum already has over 655,000 views on the video streaming site. The platform is popular with Chinese youth and has been a fertile breeding ground for internet memes due to its large fanbase of animation, comics, and gaming enthusiasts. Many of the memes from the museum originated from Bilibili and subsequently spread across the Chinese internet.
]]>On Wednesday, the Indian government accused Chinese smartphone maker Oppo of evading 43.9 billion rupees ($550 million) in import taxes.
Why it matters: The incident is the latest development in the Indian government’s investigations into Chinese tech firms with operations in the country, including Xiaomi and Vivo, which all faced tax scrutiny from the local authority earlier this year.
Details: India’s anti-smuggling agency, the Directorate of Revenue Intelligence (DRI), has launched an investigation, searching and questioning members of Oppo’s local offices, according to a press release from the Indian Finance Ministry on Wednesday.
Context: In late May, India started probing the local units of two notable Chinese phone makers, ZTE and Vivo, for alleged financial improprieties, according to Bloomberg.
Oppo sister brand Realme launched a new high-spec phone, the Realme GT2 Master Explorer Edition, on Tuesday, at a relatively low price.
Why it matters: Oppo’s Realme is known for making phones with high spec combinations at a low price, similar to Xiaomi’s sub-brand, Redmi. The GT2 features Qualcomm’s latest processor and new RAM technology.
Details: Realme GT2 Master Explorer Edition is now the cheapest phone fitted with Qualcomm’s new processor, the Snapdragon 8+ Gen 1, a chip that higher-end Android phones tend to use. The phone sells 12.5% cheaper than three other phones that have used the chip, based on a calculation from TechNode.
Context: Top Chinese phone brands Xiaomi, Oppo, and Vivo, have all established sub-brands like Redmi and Realme, and iQOO to better serve targeted groups that are more price sensitive.
Nubia, a brand owned by Chinese telecom firm ZTE, upgraded its gaming phone series with the new Red Magic 7S and 7S Pro on Monday. The new models introduce one of the fastest gaming frame rates and a virtual host for streaming as the brand looks to establish itself as a high-end gaming phone maker.
Why it matters: In an effort to differentiate itself from other gaming phone makers, the new Red Magic models come with special tech to increase gaming frames per second to offer a smoother experience.
Details: The Red Magic 7S series’ gaming features are powered by Qualcomm’s latest high-end processor, the Snapdragon 8+ Gen 1, and Nubia worked with a partner to develop the Red Core 1 chip for additional display features. The standard version has up to 16GB RAM and 512 GB storage, while the Pro has options for 18 GB RAM and 1 TB storage.
Context: Nubia introduced the gaming phone series Red Magic in 2018, six years after the brand was first established.
Taiwan-based personal computer vendor Asus has teamed up with Tencent to release two new gaming phones aimed at professional mobile gamers. The phones, which go by the name ROG 6 and ROG 6 Pro, were announced on Tuesday, with price ranging from RMB 3,999 to RMB 7,999 ($597 to $1194).
Why it matters: Asus has used its brand, ROG (Republic of Gamers), to build a suite of professional gaming devices, such as laptops, phones, and desktops. The latest phone from Asus, the ROG 6, is backed by Tencent and offers deals for the gaming giant’s titles.
Details: Designed specifically for gaming, the ROG 6 and ROG 6 Pro models have been built with oversized specs, including a maximum of 18GB RAM. The two models have also been built with special designs and features that optimize them for gameplay.
Context: Launched in 2006, Asus’ ROG focuses on various gaming hardware, from laptops to separate components like motherboards. The brand has become established in communities of spec geeks (people who prioritize high-level performance and metrics in devices) and gamers on its quality and iconic illumination effects.
On Monday, Xiaomi introduced a new series of high-end smartphones, 12S, using Sony imaging sensors and Leica lenses. The premium 12S series models are priced from RMB 3,999 to RMB 6,999 ($598 to $1046).
Why it matters: With the new series, Xiaomi has hoped to compete with rivals by offering high-end smartphones at a competitive price. The firm has focused the series on quality lenses and imaging capabilities.
Details: The three models – the Xiaomi 12S, 12S Pro, and 12S Ultra – share the same processor, coming with slight differences in other specs like charging speed, cameras, display specs, and cooling system. The three models will be available on Wednesday exclusively in China, coming in two colors for Ultra and four for the other two models, according to Android Authority.
Context: Chinese phone makers have often relied on partnerships with notable camera or lens makers to broaden their appeal. Huawei previously partnered with Leica for imaging systems in smartphones.
On June 29, TechNode CEO Lu Gang interviewed Shen Chengang, CEO and co-founder of Meetsocial Group, a cross-border marketing firm, about his insights on marketing Chinese firms to overseas audiences. This interview is part of an ongoing series by TechNode China focusing on Chinese companies doing business outside their home country.
Founded in 2013, Meetsocial Group has helped many notable Chinese companies with overseas digital marketing solutions. Its most notable clients include Chinese tech firms like Alibaba, Tencent, ByteDance, NetEase, Trip.com Group, Anker, Shein, and Xiaomi. The annual marketing budget under the firm’s management was estimated to exceed $4.5 billion in 2021, according to its official website. Since its inception, the company has provided digital marketing solutions, including software as a service (SaaS), for more than 8,000 companies.
Here are some highlights from the interview, which have been condensed and edited for clarity:
Companies need to do in-depth research on their target users to increase the probability of successful marketing overseas.
Makeup products, for instance, will find it challenging to compete in European and American markets because customers have different skin tones than in Asian markets. Thus, domestic makeup brands should prioritize entering Southeast Asian markets due to the similarities with their customer base.
For other products like apps and games, you need to find a suitable market based on your products’ features and content. Or make a new product to cater to your target market.
Compared to 10 years ago, our entire infrastructure for helping companies to go overseas has drastically improved, with better delivery, payment, and customer service systems, and those areas are still improving. This progress has made overseas markets more open to Chinese firms and pushed the construction of our infrastructure to the next step.
One key improvement is the development of China’s manufacturing industry, which has found ways to produce quality products at a competitive price. Chinese-made products have become known for their cost-effectiveness, which has helped to better incorporate Chinese companies into the global market.
Two typical cases are our clients, Shein and Anker. Shein is a cross-border platform for fast fashion, while Anker focuses on accessory products for computers and consumer electronics.
Consumer electronics products generally have more value than fashion products. Thanks to the advantage that Chinese brands have when it comes to manufacturing and high standardization in the industry, they are more cost-effective, and such products have an easier time entering overseas markets.
There are fewer opportunities for companies that focus on low-margin products, like Shein. On the contrary, brands that focus more on a specific area, like Anker, are still promising in overseas markets.
First, we pay attention to our clients’ needs and invest in related fields. We mainly focus on the e-commerce, gaming, and app sectors. In these industries, we pay attention to marketing needs, the needs of our target consumer base, and other factors.
We have also set up many local offices overseas to help companies to optimize. For example, our teams work closely with local media, learning and meeting the needs of different advertisers overseas.
We have local offices in Singapore, Japan, India, and Dubai, where our local colleagues can offer advice on local marketing strategies to better connect with the market in that region.
]]>On Monday, Tencent held its annual gaming conference Spark 2022, introducing 44 new gaming-related titles and projects. The event provides a useful outlook on gaming industry trends and the world-leading gaming company’s future plans.
Tencent is expanding its existing advantage in popular titles and mobile games while developing more expensive blockbuster projects and exploring new technologies.
As the largest gaming company in China and the second-largest in the world after Microsoft by market cap, Tencent’s domestic gaming business is plateauing while its overseas gaming business continues to grow.
Tencent’s financial results for the first quarter this year showed the firm’s game revenue in China decreased by 1% to RMB 33 billion ($4.9 billion) compared to the same period last year. In comparison, its international game revenue saw a 4% year-on-year growth to RMB 10.6 billion. Tencent attributed the results to an increase in revenues from games including Valorant and Clash of Clans, partly offsetting a decrease in revenues from PUBG Mobile as user spending normalized in the post-Covid period.
These factors are also influencing Tencent’s current thinking, as Spark demonstrated. Here are four major strategies in gaming that Tencent appears to be pursuing:
Bringing proven gaming titles to mobile
Ambitions in AAA games
Taking gaming tech into other fields
Building universes around its most popular titles
Chinese gaming giant Tencent announced on Monday that it is working on an ambitious new AAA-level title based on the work of Chinese wuxia martial arts literature titan, Jin Yong, during its annual game release event.
Why it matters: The news that Tencent will attempt to adapt Jin Yong’s work as a video game shows the firm’s ambition to create popular AAA titles with original work. A legendary writer, Jin Yong (also known as Louis Cha) and his vast literary creation in martial arts fantasies have often been compared to J.R.R Tolkien and The Lord of the Rings. Jin was one of the world’s bestselling authors and is hugely popular in the Chinese-speaking world.
Details: Code: To Jin Yong is the first video game adaptation of the works of Chinese wuxia writer Jin Yong. The video game is authorized by Ming Ho Publications, which owns the rights to Jin Yong’s work, and will be based on popular stories like The Legend of the Condor Heroes.
Context: The game may compete with Black Myth: Wukong, another promising upcoming new title based on ancient Chinese myths and characters and developed by Chinese game firm Game Science. The story is based on Sun Wukong (or The Monkey King), the protagonist in the Chinese classical novel Journey to the West.
Revenues at Taiwan-based chip foundry TSMC are expected to overtake those of semiconductor giant Intel in the second quarter, according to Yahoo Finance estimates. Such a development would make TSMC the second-largest firm in the semiconductor industry, just behind Samsung.
Why it matters: TSMC’s rise in some ways indicates the rise of the foundry business model compared to Intel’s integrated device manufacturer (IDM) model. IDMs design and fabricate chips, whereas foundries focus only on fabrication and leave design work to other companies.
Details: Since 2021, TSMC has quickly closed the revenue gap with Intel.
Context: As one of the world’s top foundries, TSMC plays an essential part in this industry. The firm’s production capacity broadly affects its upstream chip designers like Qualcomm and downstream device makers such as Apple and Xiaomi.
On Wednesday, China’s media regulators released a new regulation to tighten scrutiny on livestream hosts’ behaviors.
Why it matters: The rules require online streamers to adhere to a set of similar standards applied to the country’s tightly regulated traditional media hosts, a sign of further tightening the fast-growing and lucrative industry.
Details: The new rules are jointly released by China’s National Radio and Television Administration and the Ministry of Culture and Tourism. It consists of 18 guidelines for livestream hosts.
Context: Since earlier last year, China has been pushing to further regulate the livestream industry. In late last year, several top livestream hosts stopped their streams due to inappropriate or illegal behavior.
With one of the world’s largest LGBTQ populations, China has many social apps to meet the varying needs of the community. Homosexuality is legal in the country, but LGBTQ people have no access to many legal rights such as marriage and discrimination protection. However, those social apps often provide a much-needed space for the community.
This list is an update to TechNode’s similar compilation five years ago. We’ve seen considerable changes in China’s LGBTQ online social market in the past five years. Some apps have stopped operations; others paused for a while but managed to come back with new brandings.
Launched in 2012, Blued is a dating app primarily for gay users. The app is available in 13 languages with over 60 million registered users in 2020, according to its official website.
Similar to Grindr, Blued helps users find interesting matches nearby. In 2016, the app introduced a live streaming feature, and within two days of launching, the feature brought in over RMB 100,000 ($14,306) in income, Chinese media outlet 36Kr reported (in Chinese).
The app launched a “Community” feature in 2020, allowing users to build deeper connections through group chat functions.
Blued is owned by BlueCity, a Chinese tech firm that focuses on LGBTQ+ users. The firm went public on Nasdaq in 2020. However, the firm has a hard time turning a profit. Its net loss has expanded 39.5% year-on-year to RMB 309.6 million in 2021 due to local regulations and other factors, according to the company’s financial report. BlueCity is also in the process of going private, according to a company statement sent to TechNode.
Finka (formerly known as Aloha) is a Tinder-like dating app for gay users. Like Tinder, users can choose to like, dislike, or pass on algorithm-generated recommendations. Matched users can chat privately. Finka also offers live streaming features.
Compared to Blued, Finka focuses more on young users. The app has a youthful user interface, allowing users to upload more profile pictures than Blued.
The app is developed by Beijing Asphere Interactive Network Technology and acquired by BlueCity (in Chinese) in 2020 for RMB 240 million, 36Kr reported.
According to Qimai Data (in Chinese), the app began to trend upwards from the end of 2020, as its downloads grew threefold to 47,628 in December compared to numbers from November. In May of this year, the app had 90,948 downloads in App Store’s China mainland region.
Launched in 2012, the L (formerly known as Rela) is a social platform for lesbian and bisexual female users. Unlike traditional dating apps, the L offers an Instagram-like social platform. Users can post and react to other users’ posts in the app, offering a deeper social experience.
The app also features a public voice chatroom section, with users able to talk together about a variety of topics under labels like dating, gaming, and casual chatting, similar to the model used by social audio companies like Clubhouse.
Chinese startup Hangzhou Rilan Technology developed Rela, which was banned and pulled off from all app stores in June 2021 due to unknown reasons. Seven months later, the app came back online with new branding.
LesPark is another dating app used by lesbians in China. It uses a model similar to Tinder and Finka. According to its official website, the app has over 12 million users globally.
The app generally has a lot of the common dating app features, like speed matching, group chat, voice chat, live streaming, and an open platform for posts. One of the standout components of LesPark is the ability for users to start a random chat with strangers.
Qingyuan Park Culture of Media, a Guangdong-based company established in 2017, owns the app. It also owns another reading app called Ji Hua Le Du featuring mostly lesbian-themed writings.
As one of China’s most respected book and movie review platforms, people usually don’t think of Douban as a dating platform. But over the years, the site has quietly become a go-to place for many LGBTQ+ members, especially lesbians, to find friends, thanks to Douban’s openness and friendly attitude towards the community.
The app combines book, film, and music reviews with a Reddit-like community, offering group functions for all kinds of interests and social activities. Many Douban users often post their profiles and seek dates and friends on LGBTQ+ groups.
For example, the largest lesbian group on Douban has 69,151 members. Douban also has a diverse range of lesbian groups, some are location-focused, and others focus on more specific topics. The site has no English language versions, so it’s usually catered to Chinese-language users.
]]>Major Chinese gaming companies Tencent and NetEase partnered with Microsoft’s gaming department to bring some of their games to Microsoft’s gaming subscription service Xbox Game Pass, which Microsoft announced at a Monday showcase event.
Why it matters: Chinese developers like Tencent and NetEase are facing an economic slowdown and a tightened regulatory environment in their home market. The partnerships with Microsoft, home to dominant global gaming platforms and a vast userbase, can broaden the appeals of Chinese-developed games and Xbox’s service.
Details: The partnerships will bring titles from Tencent’s US-based developer Riot Games and NetEase’s trending PUBG-like title Naraka: Bladepoint to Microsoft’s gaming subscription service, Xbox Game Pass.
Context: Microsoft is making a push to promote its game pass subscription service, in a similar way to the likes of Spotify and Netflix, with users paying a flat monthly fee for access to a gaming library.
Chinese regulators released a list of 60 newly approved domestic titles (in Chinese) on Tuesday after another approval pause in May, including titles from notable gaming firms like HoYoverse (formerly known as miHoYo) and Perfect World. In April, the regulators resumed approving new games for the first time in eight months.
Why it matters: China’s National Press and Publication Administration (NPPA) usually releases a list of approved gaming titles monthly. With no games approved for May, gaming firms seeking to bring new titles online continue to face uncertainty.
Details: The NPPA, China’s government department for publishing news, films, and games, gave licenses to 60 new games in June.
Context: The NPPA’s eight-month halt on the issuance of new gaming licenses had major ramifications for the gaming industry in China, causing a sharp decline in the growth rate of the industry, as well as the downsizing of major players in China’s gaming sector.
Bilibili has started a round of layoffs in mid-May, according to a report by Chinese media outlet Caixin, citing multiple sources at the company. The layoffs reportedly have affected 20% of staff working with the video platform.
Why it matters: Bilibili has yet to turn a profit since it went public on Nasdaq in 2018. This layoff highlights the company’s urgency to reach its goal of becoming profitable in 2024, as mentioned by CFO Fan Xin in a March earnings call.
Details: The layoffs will mainly affect three departments: streaming, gaming, and commercialization, Caixin reported. A spokesperson from Bilibili told TechNode that the “workforce adjustments were due to business adjustments” and that they had not implemented large-scale staff cuts.
Context: Major Chinese tech firms like Tencent and JD had expanded layoffs as they are heavily affected by the new Covid-19 outbreaks and subsequent pandemic control measures. Chinese tech firms have expanded the scale of layoffs, even in crucial business arms like Tencent and JD.
Note: This article was first published on TechNode China (in Chinese).
Hillhouse Capital is a top investment institution whose investment moves are often regarded as trendsetting when related to US-listed Chinese firms. This year, the firm’s latest investment disclosure showed its new position: heavily selling Chinese EV trio Nio, Xpeng, and Li Auto, reorienting several bets in e-commerce, and keeping investments in biotechnology with some adjustments.
The detailed investment moves can be found in a report filed by HHLR Advisors, the fund management arm of Hillhouse. HHLR Advisors filed its first-quarter 13F form on May 16, a quarterly report required to be filed by institutional investment managers overseeing at least $100 million in assets. It discloses their holdings and acts and is something of a cheat sheet for investors assessing their own positions.
In the first quarter, HHLR held 64 stocks in the US stock market, 13 fewer than the previous quarter. Hillhouse sold holdings of 17 well-known companies (including Airbnb, Amazon, and Coinbase) from their portfolio, adding four Chinese companies. The total holdings of the institution were $4.8 billion, down 26% from the previous month.
Half of Hillhouse Capital’s top 10 stocks are from US-listed Chinese firms: Beigene, JD.com, Legend Biotech, Vipshop, and iQiyi. Among the 64 stocks held by Hillhouse Capital in the first quarter of this year, 24 were Chinese firms, accounting for about 38% of the total amount.
Hillhouse Capital has reduced its holdings of Legend Biotech, ZTO Express, Li Auto, Mogu, and Huazhu Hotels Group since the first quarter of this year and cleared its holdings of Boss Zhipin, as well as Nio, Pinduoduo, and Xpeng.
The institution has also increased its holdings in Vipshop, JD.com, Ke Holdings, and Acm Research. Didi, Full Truck Alliance, Futu Holdings, and a number of EV firms were added to Hillhouse Capital’s portfolio in the first quarter. Its holdings in Sohu, Uxin, Yatsen Holding, and another 11 Chinese companies remain unchanged.
Hillhouse invested in Didi, Full Truck Alliance, and Ke Holdings before they went public, so, the invested shares of these companies, which were previously private investments, were converted into American Depositary Shares (ADS). Hillhouse Capital participated in Didi’s Series D+, two strategic rounds with Full Truck Alliance, and Ke Holdings’ Series D, according to enterprise database Qichacha.
Hillhouse heavily sold off its holdings of China’s electric vehicle trio Nio, Xpeng, and Li Auto. Hillhouse sold all of its shares in Nio and Xpeng, only retained part of its shares in Li Auto, and reduced its holdings by more than half to 2.51 million shares compared to the fourth quarter of 2021.
In addition to Hillhouse Capital, Susquehanna International Group, The Goldman Sachs Group, and a number of other investment institutions also reduced their holdings (in Chinese) of the three EV makers’ stocks in the first quarter. Meanwhile, BlackRock, UBS, and other institutions that increased holdings in the trio saw their market positions shrink, with their books showing losses.
The increased amount of selling and the shrinking values are partly due to the EV companies’ stock performance. In the first quarter of this year, the stock prices of Nio, Xpeng, and Li Auto fell by 33%, 45%, and 19%, respectively.
The trio is trading at a much lower price than their respective all-time highs, despite achieving fast growth, as they face a possible delisting from the US market and show no signs of turning a profit any time soon.
Last year, shipments from Nio, Xpeng, and Li Auto increased (in Chinese) by 109.1%, 263%, and 177.4%, respectively. Annual revenue increased by 122.3%, 259.1%, and 185.6% respectively, compared to 2020. The cash flow and gross margins of the three companies also saw improvement in 2021, according to their financial results.
In the first quarter of this year, Nio delivered 25,769 new vehicles (in Chinese), a growth of 28.5% year-on-year. Xpeng sold 34,561 vehicles, 59.1% more than the same period last year. Li Auto delivered 31,716 vehicles, a yearly increase of 152.1%. Xpeng’s revenue grew 159% compared to the first quarter of last year to RMB 7.5 billion ($1.1 billion); its net loss was RMB 1.7 billion, a year-on-year increase of 116%. During the same period this year, Li Auto made RMB 9.6 billion in revenue (168% growth), while its net loss reduced by 97% to RMB 10.9 million.
This March, the three firms were added to a provisional list for possible delisting from the US stock markets by the Securities and Exchange Commission (SEC). In response to this, both Li Auto and Xpeng listed in Hong Kong late last year, while Nio moved a little slower but was ultimately listed in Hong Kong in March by way of introduction. Nio also debuted in the Singapore stock market, becoming the first automaker to list on three different stock markets.
Shi Jinman, Sealand Securities’ chief analyst, focusing on the auto industry, told TechNode that traditional automakers are profit-oriented, whereas newcomers often operate on losses to chase growth. Shi added that the three automakers referenced above can not compete with bigger traditional companies for now, but nonetheless offer some promise in a demanding market.
READ MORE: Drive I/O | Nio, Xpeng, and Li Auto face more challenges after a mixed 2021
Another major adjustment in Hillhouse Capital’s holdings came in the e-commerce sector, making a variety of different decisions for its holdings in Pinduoduo, Mogu, JD.com, and Vipshop.
Data shows that HHLR started to build positions in Pinduoduo in 2018 when its stock price was at a low level of $16. At the end of 2020, Hillhouse Capital held over 10 million shares in the firm, making it the investment institution’s largest position at the time. In 2021, the number of active buyers on Pinduoduo surpassed those of Alibaba for three consecutive quarters, and its stock price rocketed to over $212 in the first quarter of 2021. Alibaba overtook Pinduoduo again in the fourth quarter of 2021, and Hillhouse Capital responded fast, reducing its holdings by about 91.8% in the younger firm. At this point, Hillhouse Capital had made about 10 times its initial investment in Pinduoduo. Now, as Pinduoduo’s rapid growth has slowed, its stock price has also fallen back to around $40, and Hillhouse Capital has made a clean exit.
By contrast, Mogu has proven to be a flop for the investment firm. Mogu started as a shopping guide provider but missed the social e-commerce trend started by Xiaohongshu and hasn’t been able to make a pivot to other more successful verticles. Although it had a short-lived revival thanks to livestream e-commerce, the firm’s stock price now hovers below $5. Hillhouse Capital pushed for the merger of Mogu and Meilishuo, but after Mogu went public in 2018, its market value fell by 60% within the six-month lockup period, showing a steep decline. Mogu’s current market value is just RMB 19.1 million, with Hillhouse Capital losing 99% of its investment. Hillhouse Capital has gone from Mogu’s largest shareholder to its third-largest, reducing its holdings by more than 91% in the first quarter. However, it is yet to complete a full exit.
In the third quarter of 2020, Hillhouse Capital took a position in JD.com when the firm’s strategy to focus more on China’s lower-tier cities paid off, with the number of annual active buyers increasing by more than 100 million (in Chinese) for two consecutive years. Yet, Hillhouse reduced its holdings in the firm in the following three quarters, before once again increasing its holdings by nearly 30% in the third quarter of 2021. JD’s number of active buyers continued to grow to 570 million in the fourth quarter of 2021, according to JD’s annual report. In the first quarter of this year, that number grew to 580.5 million, and Hillhouse’s latest position in JD.com is nearly double what it was in the fourth quarter of 2021.
Hillhouse Capital has simultaneously built its position in Alibaba and Vipshop since the first quarter of 2021 and followed the same strategy in the following two quarters. In the fourth quarter of 2021, Hillhouse sold 24,560 shares in Vipshop and cleared its holdings in Alibaba. According to its financial report, Vipshop performed poorly in the fourth quarter of 2021, with revenue of RMB 34.1 billion, a 5% year-on-year fall. Its net profit was RMB 1.4 billion, falling 41.7% compared to the same quarter last year. The firm had 49.3 million active users, losing 3.7 million users in 2021.
In the first quarter of this year, Vipshop’s revenue, profit, and user numbers continued to fall. Still, Hillhouse Capital’s holdings in Vipshop more than doubled from the fourth quarter of last year, making the firm one of Hillhouse Capital’s top 10 holdings for the first time.
JD and Vipshop represent Hillhouse Capital’s second and seventh largest positions, at $488 million and $199 million.
Li Chengdong, an indepent analyst focusing on e-commerce in China, wrote in an analysis published on NetEase News that Vipshop now has a mature operation model along with loyal users and notable suppliers. The firm has built barriers to competition in its sector and built a unique advantage, which explains Hillhouse Capital’s expanded bet on Vipshop.
Biotech has been Hillhouse Capital’s most outstanding bet and also one of the most important categories that the institution holds. In the last two years, biotech-related stocks have represented 40% of Hillhouse Capital’s holdings, with the market cap of biotech companies at one point becoming the top category, surpassing that of tech companies.
The pandemic has made biotech stocks hot trades for the past two years. Nowadays, biotech firms have gradually cooled and entered a more serious and competitive phase. Compared with the fourth quarter of last year, Hillhouse Capital’s positions in BridgeBioPharma, CytekBiosciences, GossamerBio, InstilBio, and MereoBiopharma have remained unchanged. However, the market caps on their positions have decreased by 23% to 39%.
Hillhouse Capital has also begun to adjust its holdings in medical tech firms, clearing its positions in Prometheus Bio, Rallybio, Regenxbio, and more, and reducing its holdings in Chinese firm Legend Biotech from 11.805 million shares to 6.9 million shares. Following this adjustment, Legend Biotech fell from the third-largest holding of Hillhouse Capital to the fifth-largest.
Hillhouse’s shares in the other two Chinese biomedical stocks, Beigene and I-Mab, remained unchanged, with their market caps ranking first and 11th among Hillhouse Capital’s holdings, respectively. In total, Hillhouse Capital owns more than 10% of the three biotech companies (Legend Biotech, Beigene, and I-Mab), according to Shanghai-based financial data firm Wind.
Founded in 2011, Beigene is one of the four leading drug developers invested by Hillhouse Capital that researches PD-1 cancer drugs. Hillhouse Capital’s investment has covered the whole life cycle of Beigene. According to Qichacha, Hillhouse participated in Beigene’s Series A, Series B, and two private placement rounds after the firm’s US and Hong Kong IPOs.
In December 2021, Beigene succeeded in listing in China, thus becoming the only innovative drug company listed on three different stock markets. From participating in the $74.5 million Series A financing in 2014 to participating in the $2.1 billion private placement in 2020, Hillhouse Capital has bet more than RMB 8 billion on Beigene.
The research and development of innovative drugs generally come with heavy a upfront investment, a long development cycle, and high risk. Financial results show that Beigene has been in the red for seven years since its listing in the US.
In the first quarter of 2022, Beigene’s revenue was RMB 1.9 billion, a 50% yearly decrease. Its net loss fell almost tenfold to RMB 2.9 billion compared to the same quarter last year. In the first quarter, sales of Beigene products increased by 146% yearly. Among them, global sales of Zebutinib, a medicine used to treat cancer, hit $104.3 million, a 372% growth compared to the first quarter of 2021.
Hillhouse Capital held a position of 5.5 million shares in Beigene on the US market until the first quarter of this year. As of May 25, the stock price of Beigene was $123. Given the market valuation of $103 billion disclosed in the F13 document, Hillhouse Capital has suffered a loss of about $360 million due to its position in Beigene.
As of May 25, Hillhouse Capital’s holdings in Legend Biotech represent a surplus of $18.7 million, and its holdings in I-Mab a loss of $40.9 million.
As many US-listed Chinese stocks trade at a lower price, Hillhouse Capital has bucked the trend to increase its holdings in such firms, demonstrating its optimistic view of China-related assets. Yet the gradual disappearance of traditional Chinese tech giants such as Alibaba in its top 20 positions shows the institution’s appetite for higher growth assets. Hillhouse’s continuous adjustments of certain stocks also reflect the significant changes in the structure of the Chinese e-commerce industry over the years.
Hillhouse Capital is noted for its precision and high return on investment, but no investment firm is entirely infallible. The firm’s track record is impressive, and its dealings potentially offer some valuable insight into oncoming market trends, but ordinary investors should always be wary of blindly following any institution when it comes to playing the stock market.
]]>Chinese smartphone brands Oppo and Vivo have joined with education brand Okii to build a K-12 school in the southern Chinese city of Dongguan, where the brands have manufacturing facilities, according to an official announcement by ITHome on June 1. All three brands are owned by the parent company, BBK Electronics.
Why it matters: Okii is an edtech brand in China that makes study devices for kids. Leveraging BBK’s resources, the project shows the long-term ambition of the brands.
Details: The school, called “Dongguan BBK Experimental School” (our translation), is approved by the Dongguan Education Bureau in Guangdong province. Oppo, Vivo, and Okii will begin enrolling students next September.
Context: Oppo and Vivo are following the footsteps of other large consumer electronics firms in building a community in their base cities. Samsung and Haier have done similar social projects.
Cloud services have become a rare growth point for Chinese tech majors Alibaba, Baidu, and Tencent in this earning season. The tech majors have seen overall growth plateau and profit drop as they navigate an economic downturn made worse by the pandemic resurgence and geopolitical uncertainty.
Why it matters: Over the years, Chinese tech majors Alibaba, Baidu, and Tencent have built up sizable operations in cloud solutions for businesses. Those cloud units have now grown strong enough to offer sustainable business returns.
Details: Cloud services have become a rare growth point in the lackluster earnings reports of Alibaba, Baidu, and Tencent, as the majors’ businesses were hit by China’s strict Covid-19 control measures, slowing consumption, and external geopolitical challenges.
Context: According to Canalys, China’s cloud infrastructure services market grew by 45% to $27.4 billion in 2021.
]]>READ MORE: Why does China want to build a national data center system by 2025?
Qualcomm and MediaTek plan to cut another 30% in 5G chip orders in the second half of 2022 due to a decline in orders from Chinese phone makers, according to Ming-Chi Kuo, an analyst at TF International Securities and a frequent Apple supply chain news commentator, wrote in a May 22 report.
Why it matters: Weak demand in the Chinese smartphone market has resulted in domestic phone makers cutting orders, causing a ripple effect in the industry. Additionally, android phones are using processors one or two generations behind Apple, making them face a long uphill battle in China.
Details: Qualcomm and MediaTek, two of the world’s largest system-on-a-chip (SoC) makers, have reportedly been forced to cut orders after Chinese phone brands had to cut smartphone orders as a result of Covid-19 lockdowns across China and weak demand for smartphones.
Context: China shipped 17.6 million smartphone units in April, a yearly decline of 21.6% and 12.2% less from March. The decline can be attributed to a drop in market demand and less promising processors for Android phones compared to Apple’s, according to a report from CINNO Research.
Chinese smartphone maker Xiaomi released the Redmi Note 11T Pro and Pro+ on Tuesday, priced at RMB 1,799-2,499 ($270-$374). The new models mark a further move into higher-end markets for the sub-brand Redmi, which was previously focused primarily on budget devices.
Why it matters: The new series is indicative of the maturation of Xiaomi’s phone offerings, which have found significant popularity in China and in developing markets overseas. The new Redmi Note phones, targeted at middle- and high-end customers, will intensify competition between Xiaomi and rival brands such as Oppo’s Realme.
Details: The newly released Redmi Note series promises higher specs than previous Xiaomi models without abandoning the brand’s affordable image.
Context: Xiaomi is the third-largest mobile vendor globally after Samsung and Apple, with a 12.8% of the global smartphone market share in April, according to web analytics firm StatCounter.
Chinese tech giant Tencent is undergoing another round of layoffs across the company to counteract worsening financial results, Chinese media outlet Caijing reported (in Chinese) last Friday.
Why it matters: Tencent’s reportedly new layoff round indicates that Chinese tech’s “great layoff” is far from over.
Details: Tencent initially began a headcount reduction at the end of last year, with an estimated 20% of employees at the firm affected. However, continued redundancies at the company, including its core business unit like gaming, in the wake of disappointing financial results may suggest that the cuts will go even deeper.
Context: Tencent’s continuing layoff came against the backdrop of a slowing Chinese economy, a widespread regulatory crackdown in the tech sector, and several major hurdles in the gaming realm (including a seven-month pause in new game licenses), where it is an industry leader.
A new Chinese startup founded by DingTalk’s former CEO Chen Hang launches a new line of wireless earbuds, its first consumer electronic product, on Tuesday on the US crowdfunding site Indiegogo.
Why it matters: The earbuds are the first batch of releases from Chen Hang’s new startup called HHO, which he founded after leaving Alibaba’s workplace collaboration app DingTalk in July 2021. Chen’s new project focuses on helping local Chinese manufacturers to produce and sell products directly to overseas consumers.
Details: The main selling point of the earbuds are their light control feature. Called GPods, the earbuds beam lights along the spine. It also supports customized control for the color and pattern of the light. A corresponding app uses an algorithm to pick and generate color patterns from any picture chosen by the user. The color can change to match the beat of the music.
A Chinese virtual idol group called A-Soul, backed by ByteDance, has found itself embroiled in a social debate after it canceled the livestream of a virtual member named Carol.
Why it matters: By canceling a virtual member, A-Soul inadvertently prompted a debate on the working condition of the often invisible artists behind virtual idols. Virtual idols are often supported by teams of real human artists who provide voices and dance moves through motion captures and other technology.
Details: A-Soul announced on May 10 that it will cancel the daily livestreams of Carol, a leading virtual vocalist of the five-member group. The announcement said Carol will enter a dormant period due to “schoolwork and medical issues.”
Context: A-Soul was launched in November 2020 by ByteDance and Beijing-based firm Yuehua Entertainment, which manages notable Chinese artists like Han Geng and Wang Yibo. The group’s most popular video has 5.3 million views on Bilibili. Dismissed member Carol’s top 10 videos each have more than 1 million views each on Bilibili.
Chinese video platform Bilibili announced on Wednesday that it is implementing new rules (in Chinese) to combat the rise of hateful speech and inappropriate content on the platform.
Why it matters: This is another self-cleaning act from China’s video platform. Bilibili has made at least seven announcements to remove inappropriate content since January to comply with tightening content control from Chinese regulators.
Details: Bilibili said it had noticed an uptick of videos that make unethical jokes about the dead and attacks others based on their gender, occupation, and age. The platform said such disrespectful content is “plaguing the community.” Bilibili will start implementing the rules by deleting such content for the first month. After that, content creators will face account suspension if they continue to create such content.
Context: As of 2021, Bilibili had 271.7 million monthly active users and 10 million newly uploaded videos per month. The platform has become a thriving community for vloggers and fans of animation, comics, and games.
Chinese smartphone maker ZTE announced the launch of Axon 40 Ultra on Monday, the third generation of a smartphone that features an under-display camera.
Why it matters: ZTE has adapted an under-display camera design, rather than traditional options like notch display or hole-punch display, to create an all-screen design.
Details: Axon 40 Ultra is equipped with an all-screen 6.8-inch display. The phone maker touts improved screen image quality compared with previous generations.
Context: ZTE also revealed its 2021 overall performance during the product launch, recording 100 million unit shipments, with 50% of chips used in these shipments developed by the firm.
IP proxy services have become a sought-after tool in China less than a month after the country’s main social media platforms started to reveal all users’ location information.
Why it matters: Chinese internet users are in a cat and mouse game with the country’s social media platforms which have dealt a blow to users’ privacy by forcing them to reveal their geolocation.
Details: Chinese media outlet The Paper on Thursday reported (in Chinese) that many businesses are now selling services that change IP addresses for as little as RMB 6 ($0.9) per day on e-commerce platforms like Taobao. Many of these businesses say that they can alter location information (in Chinese) on platforms like Weibo and Douyin.
Context: Social e-commerce platform Xiaohongshu is one of the few platforms that gives users the option to hide their location information.
The CEO of Huawei spinoff Honor told state media on Thursday that the smartphone company plans to push overseas sales over the next five years.
Why it matters: In November 2020, Huawei sold Honor, a budget smartphone sub-brand, to a majority Shenzhen state-owned company. In the 18 months since this sale, the firm has steadily gained market share in China and reached the top spot in domestic sales in March. Outside of China, the brand faces fierce competition from Chinese peers like Xiaomi, Vivo, and Oppo, as well as industry leaders like Apple and Samsung.
Details: Honor’s CEO Zhao Ming told China Securities Journal (in Chinese), a state-owned media outlet, on Thursday that the company will “fully launch sales to the overseas markets and expects no bottleneck period for the next five years.”
Context: Founded in 2013, Honor was formerly owned by Chinese telecom giant Huawei as a sub-brand.
Amid slowing growth and regulatory uncertainty at home, China’s gaming companies are increasingly eyeing overseas markets. Many of them have had impressive growth figures in international markets for some time, but the situation at home is driving them to view foreign gamers in a new light. Established players such as Tencent and NetEase – both of which are in the top five gaming firms in the world – are giving international growth new emphasis, while rising upstarts such as HoYoverse (formerly known as miHoYo), FunPlus, and 37 Interactive Entertainment are seeing surging interest in their titles outside of China.
The diversity in terms of the size of Chinese gaming firms finding success abroad shows that there’s something of a relatively level playing field outside of a domestic market that is dominated by a handful of majors – even small indie game makers are able to strike it big when they look beyond their own backyard. Yet there’s no cheat code for doing well internationally and Chinese game firms face new modes of competition and significant cultural challenges when they venture outside of China.
READ MORE: The Chinese gaming startup outperforming Tencent overseas
To reflect the increasing scale of its global gaming growth, Tencent started to disclose revenues from domestic games and overseas games as new sub-segments in the third quarter of 2021.
In a challenging 2021, Tencent’s overseas games saw an impressive 31% yearly growth, while the domestic gaming sector grew by only 6%. Tencent made RMB 25 to 30 billion ($3.79 to $4.55 billion) in overseas games in the first three quarters of 2021, accounting for about 20% of its gaming revenue. Overall, the company saw its slowest revenue and profit growth in five years, 16.2% and 11%, respectively, underlining the international gaming division’s eye-catching performance.
NetEase first revealed its overseas gaming performance in the third quarter of 2018, saying incomes from overseas markets accounted for 10% of the total net profit in its gaming business that year. The latest figures show that overseas gaming revenue accounted for 11% to 15% of NetEase’s gaming revenues in the first three quarters of 2021. However, the company didn’t reveal a detailed breakdown of overseas gaming revenue in its 2021 annual report.
Although the growth in NetEase’s overseas gaming revenue has been steady rather than spectacular in the last three years, the company has set a goal of expanding earnings outside of China to 50% of its gaming income, with a focus on markets in Japan and North America, according to Chinese media outlet Jiemian. NetEase also dramatically increased its research and development expense ratio in the past two years, hoping to win with better gaming developing skills. The report added that the ratio doubled from 8% in 2017 to 16% in the first three quarters of 2021.
In March of this year, of the top 10 highest-grossing mobile games globally, four came from Chinese gaming companies, according to Sensor Tower: Tencent’s Honor of Kings and PUBG Mobile, HoYoverse’s Genshin Impact, and Alibaba’s Three Kingdom TacTics. Lilith’s Rise of Kingdoms also made it into the top-grossing list on the App Store. Among the Chinese titles, HoYoverse’s Genshin Impact was the most profitable. Tencent’s PUBG Mobile was second, with Lilith’s Rise of Kingdoms ranked third.
Genshin Impact is a sprawling multiplayer online role-playing game (MMORPG). Launched in 2020, it hit 115 million downloads in its first 18 months, according to Data.ai, a US insight firm focusing on app stores. According to Data.ai, Genshin Impact’s success was so big it helped put a positive spin on figures for the whole category, pushing MMORPG revenue to grow 17% year-on-year in 2021, despite other titles in the same category showing a slow and even negative increase in revenue.
Tencent’s PUBG Mobile, in many ways, has followed the success of its PC version. The title has found popularity with a new game mode called battle royale, whereby players fight to be the last one standing amid a mass competition with hundreds of other players. Its primary competitor is Call of Duty Mobile, also developed by Tencent and published by Activision, which ranks seventh on Sensor Tower’s list.
Chinese gaming companies are having a tough time getting new games approved and making money in the domestic market due to tightening regulations around young players’ gaming habits and strict limits on new game licenses.
Late last August, Chinese regulators asked all companies to limit minors’ access to games (in Chinese), with the aim of protecting them from gaming addiction. As a result, those under the age of 18 can only play games one hour a day on Fridays, weekends, and holidays, according to the rules, with no gaming time allowed on weekdays.
Tencent said in its 2021 annual financial report that the new regulations hit the company’s domestic games revenue due to “less spending by minors” and the company allocating developer resources “to implement new measures.”
Around the same time, China also stopped issuing licenses to new games. The regulator only resumed issuing licenses in April, eight months later. This wasn’t the first time the regulator withheld its licensing power. In 2018, the issuing of licenses was halted from March to December. Game publishers in China need a license from the National Radio and Television Administration (NRTA), the state’s regulator for news, print, and publications, to be listed in app stores or to be downloadable on their websites within the country.
The extended freeze has forced many Chinese gaming companies to downsize. Since last year, major Chinese gaming companies such as NetEase, Lilith, IGG, and Perfect World have had to cut off projects and lay off staff.
READ MORE: China’s gaming industry is downsizing as regulators halt new game licenses: report
Amid such problems, many are forecasting another grim year at home for Chinese gaming companies in 2022. DataEye, a Shenzhen-based industry insights firm, wrote in their 2021 annual report that they foresee another slow year ahead. “The domestic market won’t see major growth. 5% growth is optimistic; no growth is also likely,” said the report. Instead, they noted, “The main growth in the industry will most likely come from the overseas market.”
It’s easy to see the allure of international sales given the picture back home. Yet, despite some major success stories so far, achieving sustained growth internationally comes with its own set of difficulties for Chinese game developers. There have been some surprise hits, such as indie outfit Coconut Island’s crossover success Chinese Parents, but for large-scale, longer-term growth, a sophisticated understanding of international markets is required.
“Localization in overseas markets goes way beyond just translating the content in local languages. The key is in cultural localization,” Wang Yangbin, CEO of DataEye, wrote in the firm’s report. “These are problems all top Chinese firms — Tencent, NetEase, and Alibaba — and second-tier companies have to solve quickly.”
How quickly they do so may well determine how soon and to what extent international markets can provide the kind of salvation that many Chinese gaming companies appear to be looking for by heading overseas.
]]>On Thursday, Chinese telecommunications giant Huawei released Mate Xs 2, the second generation of its foldable Mate Xs series, priced from RMB 9,999 ($1505).
Why it matters: Huawei first adopted an outer folding design for its foldable phones in 2019, differing from mainstream models that folded inward, thereby solving the key issue of the prominent crease on the screens of foldable phones. With new hardware updates, Mate Xs 2 is vying to be a strong competitor in this vertical.
Details: Targeted at the high-end market, Huawei highlighted Mate Xs 2’s top-line tech specifications at the launch event on Thursday.
Context: In 2021, Huawei shipped 900,000 units of foldable phones, accounting for 10% of the market, a distant second to Korean manufacturer Samsung, which accounts for 88% of the market.
Chinese startup PopuMusic launched a new portable digital piano called PopuPiano earlier this month. It’s the company’s latest smart instrument after releasing a smart guitar called Poputar and a smart ukulele called Populele.
The company aims to attract new music learners seeking a fun, flexible way to learn piano and professional composers looking for a portable piano.
Details: PopuPiano is said to be as capable as a full-size digital piano, featuring 29 keys and a removable chord pad. The early pre-order option is priced at $199.
Context: Founded in 2015, PopuMusic is headquartered in Beijing and is backed by well-known investors, including ZhenFund and Shunwei.
A Chinese-language guide on GitHub entitled “HowToLiveLonger” is trending within the Chinese tech community.
Why it matters: Despite its serious and scientific tone, the new “guide” appears to be a pointed joke, taking aim at ongoing overwork practices in China’s tech industry and their impact on employees’ mental and physical well-being. Its popular reception in Chinese tech circles reflects the community’s current mood.
Details: The project made it into GitHub’s Chinese language top trending list four days after it was published on April 16, according to Chinese news outlets. The project has won 13,000 stars on GitHub as of writing. By comparison, this week’s top project has 11,000 stars on the platform’s trending list.
Context: In March 2019, GitHub became more than a code-sharing platform for Chinese users after the publication of the now-famous project “996.ICU.” The project claimed that the 996 work schedule was against Chinese labor law and would cause workers to end up in intensive care units (ICU). The project quickly gathered global attention and kickstarted a widespread discussion on Chinese tech companies’ overtime practices.
OnePlus, the Chinese smartphone maker owned by Oppo, launched a new product line named Ace, targeting the global mobile gaming market. The company released the first model of the series on Thursday, pricing at RMB 2,499 ($384).
Why it matters: OnePlus is expanding its offering to the global mobile gaming market after launching OnePlus 9R last year.
Details: On Tuesday, OnePlus revealed the new Ace product line for mobile gaming, alongside a new entrance level True Wireless Stereo (TWS) earbuds in a release event.
Context: OnePlus merged with Oppo, another major smartphone brand in China, last year and is now an independent brand under the Oppo umbrella, focusing on overseas markets.
Apple’s supply chain companies in China face major production disruptions as Chinese cities follow the country’s strict covid policies with full and partial lockdowns since late March to tackle a new wave of Covid-19 outbreaks. Although Shanghai and nearby cities have recently begun to assist manufacturers in resuming operations, analysts still expect major disruptions to Apple’s shipments.
Why it matters: China plays a vital role in Apple’s supply chain and its global shipments, with Chinese factories accounting for almost half of Apple’s total supply chain. iPhone shipments could fall behind by 6 to 10 million units, according to one analyst quoted by 9to5mac, an Apple daily news site. Meanwhile, expected arrival times for some iPad and Mac models have also been disturbed by weeks-long delays.
Details: Shanghai began a two-step city-wide lockdown on March 28 as daily new Covid cases broke 4,000. The harsh control measures soon spread to neighboring provinces of Jiangsu and Zhejiang. These eastern regions are key to China’s high-tech manufacturing sector, including carmaking, semiconductors, and electronics.
Context: Shanghai’s ongoing weeks-long lockdown has triggered severe cascading effects in various industries from automobile to semiconductor to e-commerce. The Shanghai municipal government encouraged several key industries to resume production on April 16. But manufacturers still expect delays in the future.
Chinese tech giant Tencent announced on Wednesday that it will close a gamer-focused accelerator service that allows Chinese gamers access to overseas games. Due to “an adjustment in business operation strategy,” Tencent’s accelerator service will only support domestic games from June onwards.
Why it matters: This move by Tencent has caused players to worry that accelerator services for overseas games may soon become inaccessible in mainland China.
Details: Tencent announced that its accelerator service called Tencent Jiasuqi will undergo a major update and be renamed Tencent Gaming Assistant. The service will no longer offer users access to overseas gaming networks. Instead, Tencent will offer refunds to users who have already paid for Tencent Jiasuqi.
Context: There are over 100 gaming network accelerators in China for players, but many have less tech stability than Tencent’s and NetEase’s services.
Chinese smartphone manufacturer Vivo released its first foldable phone on Tuesday, targeting premium users with a price tag of around $1,500.
Why it matters: Vivo follows the footsteps of rival brands such as Xiaomi, Huawei, and Oppo, releasing its first foldable phone. Global shipments of foldable phones will hit 15.7 million in 2022, forecasting a yearly growth rate of 107%, according to market research firm CINNO Research.
Details: Using a Samsung display screen, the Vivo X Fold has an 8.03-inch interior display when used in tablet mode and a 6.53-inch exterior display when folded. For comparison, an iPhone 13 has a 6.1-inch display, and a regular iPad is 10.9 inches.
Context: CINNO predicts that Samsung will lead the foldable market this year with a 70% share.
On Monday, China resumed issuing new gaming licenses (in Chinese) after pausing it for eight months when the country began a broad crackdown on content, gaming, and the education sector last summer.
Why it matters: The halt on new gaming licenses led to an 8-month-long winter for the gaming industry in China, forcing many game makers to downsize, cutting down on development projects, and laying off staff.
Details: On Monday, China’s National Press and Publication Administration (NPPA) released a list of licensed games for April, made up of 45 Chinese games. It’s the first list of licensed games released by the administration since last July, with new licenses put on hold since August.
Context: China has strict rules for publications, which apply to video games. Companies must apply to NPPA for gaming licenses to publish new games. In the seven months of 2021, before the freeze, China issued 675 gaming licenses, averaging 96 per month.
After China’s ride-hailing giant Didi was put under a cybersecurity review by the Chinese authorities last July, the country’s internet sector quickly entered a period of painful adjustments. Companies began closing unprofitable units and cutting staff wherever they could. Layoffs have since become so widespread that some Chinese tech majors have been attempting to soften the blow by telling fired employees that they have “graduated,” but it has become increasingly difficult to put a positive spin on such moves, as China’s consumer-facing tech companies go through a significant upheaval.
Since July 2021, major Chinese tech companies have laid off at least 72,779 employees, TechNode research has found. After compiling news reports, company statements, and other sources from the past nine months, TechNode found 27 instances where major Chinese tech companies were reported to be making significant layoffs, with at least 10 such instances affecting more than 30% of employees at their respective companies. Some firms dismissed entire departments almost overnight.
After combing through the statistics, it is clear that layoffs have become a regular occurrence at Chinese tech companies. In the past nine months, there has been an average of two rounds of layoffs per month. Moreover, in the same period, ByteDance has had five separate rounds of staff reductions alone, making it the top cutter among the major tech companies in the country.
China’s “great layoff” first hit the edtech sector, prompted by a surprise national regulation barring all private curriculum tutoring, which took effect in July. It then hit less profitable units in the e-commerce sector, and most recently, it spread to Meituan, Alibaba, and Tencent, powerful leaders of their own sectors that had previously proven largely immune to the effects of any regulatory changes or downturns.
Education, e-commerce, and the content and entertainment industry are the three sectors to bear the main brunt of this wave of layoffs. But just how far-reaching have the cuts been?
In March, Tencent, a major cloud service provider in China, started a 20% layoff of its team in the sector, affecting an estimated 12,000 employees. The firm’s Cloud & Smart Industries Business and Platform and Content Group took the biggest hit.
Twitter-like microblogging service Weibo, one of the biggest social platforms in China, laid off at least 200 employees and introduced a stricter performance review standard in February 2022. Weibo has declined to describe the moves as a layoff, saying they were “structural adjustments.”
ByteDance also cut numbers at its customer service unit in October 2021, removing somewhere between 30% and 70% of the team due to what it termed “business adjustments.”
Didi, which is still going through a national cybersecurity review that launched nine months ago and is looking to delist from the US stock market, reportedly cut 20% of its employees in February.
The content and entertainment industry is another area where players large and small have been handing their employees grim news. Since last July, four major companies in the sector have undergone six rounds of dismissals and restructuring.
ByteDance laid off at least 179 employees in two rounds last year, one of which was mainly focused on its gaming development business, Ohayoo. The company said that recently-hired college graduates would be reassigned to other vacancies as part of the round. The TikTok parent company followed this with another round of layoffs on October 20, aimed primarily at its commercialization and gaming businesses.
TikTok’s major rival in China, Kuaishou, started to lay off staff at the end of 2021, first in its commercialization team and then across multiple sectors. The company reportedly removed somewhere between 10% and 30% of its employees.
iQiyi, a Netflix-like streaming platform backed by Baidu, was reported to have cut between 20% and 40% of employees in December 2021. The company promised to compensate these unlucky employees, offering them bonuses based on how long they had worked at the firm.
While it’s undoubtedly been impacted by the overall economic downturn, the content and entertainment sector has also been hit by regulatory scrutiny, with crackdowns targeting celebrity culture and related idol content as well as the gaming sector. Pop Idol-like shows on platforms such as iQiyi have been banned and China put a pause on issuing new gaming licenses last year, essentially stopping companies from releasing new games. In addition, China has introduced strict controls targeting teenage players, limiting their playing time and payment for games. In response, Chinese gaming companies have shut down numerous development projects and turned to overseas markets, with their China workforces naturally being affected.
E-commerce, a longtime booming sector in China, has also seen contractions. From July 2021 to March of this year, at least 11 major tech companies in the industry have downsized their workforces, according to TechNode statistics.
Most recently, Meituan began on April 8 with an up to 20% cut across its business lines, including its core food delivery and hotel booking businesses.
Chinese e-commerce giant Alibaba has been through two rounds of layoffs in the first quarter of 2022 alone. The first round was in January this year, when it cut headcounts at its food delivery platform Ele.me and local shop review business Koubei. Two months later, Alibaba’s layoff expanded to the entire local service sector, with 30% of its employees losing their jobs.
Tencent also announced that it was making 30% of the staff at its e-commerce platform Mogujie redundant in late 2021, blaming the unit’s poor market performance.
Community group buy, a subsector that caught on during the height of the first wave of the coronavirus pandemic in 2020, has seen deep cuts as part of the ongoing layoffs. The cash-burning sector quickly cooled down after the State Administration for Market Regulation (SAMR) demanded companies stop price dumping and other unfair competition practices in December 2020.
Smaller players in this subsector have been hit hard, with one example being Tongcheng Life, which filed for bankruptcy last July. Those backed by bigger companies have also been forced to make adjustments to remain competitive. Didi’s Chengxin Youxuan cut about a third of its staff, while Alibaba-backed Nice Tuan stopped operating in several cities.
Fast forward to late March, and JD was reportedly planning company-wide cuts of between 10% and 30%. Its community group buy unit Jingxi is thought to see the deepest cuts.
Other tech companies offering local services, such as apartment rental platform Ke.com and farm-to-table grocery startup Meicai, have followed suit. Ke.com cut its entire development team in October 2021, while Meicai laid off nearly half of its workforce around September 2021.
Dian, a Chinese startup offering rental charge packages for phones, was reported to have laid off 40% of its employees on March 1. According to Chinese financial media Lanjing, the company dismissed at least 2,000 employees. However, the company denied the news, saying it was merely making “adjustments in employee structure.”
In addition, popular milk tea brand HeyTea, which makes heavy use of e-commerce and online promotions to support its business, was reported to have cut its workforce by 30% in February this year.
After China’s new regulation on education agencies took effect in July 2021, there were at least five rounds of layoffs in tech companies focusing on education. More than 5,400 people lost their jobs.
Companies in the sector saw their stock prices crash after July 24. Within a day, Gaotu fell by 54%, New Oriental by 63%, and TAL Education saw more than 70% wiped off its share price.
Gaotu was reported to have laid off more than 10,000 employees in early August 2021. Another education giant New Oriental reportedly dismissed over 40,000 employees in mid-September. It wasn’t just the leading names in the industry who were hit, however, Acadsoc, a Chinese company offering courses by foreign teachers, laid off 90% of its workforce on July 29, 2021.
Chinese tech unicorn ByteDance was also forced to make cuts. The company went through a series of downsizings in its education sector, with a first round in early August followed by a second round in December, shedding more than 1,000 employees.
On April 8, China’s internet regulator, the Cyberspace Administration of China (CAC), confirmed in a statement that 12 major Chinese tech companies (Tencent, Alibaba, Ant Group, ByteDance, Meituan, Pinduoduo, Kuaishou, Baidu, JD, NetEase, Weibo, and Bilibili) have laid off 216,800 staff from last July to March. However, CAC said “the number of employees in internet companies has remained stable,” disputing the layoff trend, adding that these companies have also hired about 295,900 new employees during the period.
As painful as these adjustments have been to date, it seems unlikely that Chinese tech majors are in the clear just yet. Regulatory scrutiny will continue (perhaps in a more predictable fashion as the government prioritizes economic growth), rising geopolitical concerns mean that firms listed on US exchanges, in particular, will come under pressure, and China’s ongoing attempts to pursue a ‘zero Covid’ policy may mean further disruption for businesses.
Since early March, China has extended lockdowns in the key growth city of Shanghai and introduced new control measures across the country to adhere to its zero Covid policy amid a resurgence in the number of coronavirus cases. As China’s economy takes a hit, the country’s tech sector is likely to come under more pressure. China’s State Council executive meeting on April 6 also acknowledged the challenge ahead, admitting that the country’s economy faces “complexity and uncertainties” that have exceeded expectations, and that “the recent Covid-19 outbreak in China has increased difficulties for market entities, and increased new downward pressure on the economy.”
There are some glimmers of hope, however. Although Didi’s investigation put a pause on Chinese tech companies seeking overseas listings, there appear to be moves to help Chinese businesses raise money more easily on foreign stock markets. Chinese Vice Premier Liu He said in a mid-March meeting that “China continues to support companies seeking to go public overseas,” offering the first major positive signal on the issue in nine months. Moreover, China’s securities regulator has proposed changes to long-standing rules in an attempt to avoid US-listed Chinese companies being delisted by American regulators.
Nevertheless, the big picture remains unpredictable for China’s tech powerhouses. After years of unbridled growth, it’s clear that the industry has been through a turbulent period of late. Whether the widespread “adjustments” made across multiple sectors will be enough to stave off further disruption remains to be seen.
]]>Chinese video platform Bilibili introduced a new earphone brand called Bilipods with a first product on Wednesday, as it attempts to expand its business in the consumer electronic market.
Why it matters: In the past, Bilibili has partnered with consumer electronic companies to release products with its branding. The launch of Bilipods indicates that the video platform wants to go a step further and utilize its large user base (about 270 million in 2021) to benefit from the booming earphones market.
Details: On Wednesday, Bilibili officially promoted the new earphone brand and its first product to the public. The video platform previously released its earphones and headphones through BEMOE, a sub-brand focusing on various animation-related merchandise.
Context: This isn’t the first attempt by Bilibili to get into consumer electronics, as the company has previously joined forces with a variety of consumer electronics manufacturers to launch products using Bilibili’s branding.
ByteDance, the creator of hugely popular short-video apps Douyin and TikTok, is reportedly internally testing a new news aggregation social app called Shiqu.
Why it matters: Unlike ByteDance’s other more popular offerings that rely on algorithm-based recommendations, Shiqu offers an algorithm-driven news feed that also allows customized RSS imports. The app looks to target well-educated readers, judging by screenshots of the test versions reported by the Chinese outlet iFranr.
Details: Shiqu has two main features: topic-based reading boards and discussion groups, similar to Flipboard plus Reddit. Users can subscribe to their favorite topics or accounts, which routinely offer new content. The app’s other main feature offers a Reddit-like community, where users can join or create new groups related to specific topics and start discussion threads, according to the iFanr report.
Context: ByteDance first won mainstream success with a Chinese news aggregator called Jinri Toutiao, a mobile-first app that curates news based on algorithms. Shiqu looks to be catering to a more sophisticated user base that wants a customized reading experience and communities to discuss ideas. That target puts Shiqu in competition with established players like Douban.
As the Russia-Ukraine war drags on, the market for rare gasses has seen greater volatility. High purity rare gasses used in semiconductor production have seen a rapid price surge, with neon gas prices growing tenfold and krypton gas up by almost half since the conflict.
Rare gasses are primarily inert and gaseous elements of neon, argon, krypton, xenon, and others. They are key raw materials used in semiconductor productions.
Until the war broke out in late February, Ukraine supplied nearly 70% of the world’s neon gas, the rare gas used in chip production, according to Trendforce, a semiconductor consultancy based in Taiwan. On March 11, three weeks into the conflict, two major Ukrainian neon gas suppliers, Ingas and Cryoin, were forced to halt their operations. The two companies together make up almost half of the global neon production, according to Reuters.
TechNode looks at China’s rare gas industry and how it might influence the country’s reaction to the rising rare gas prices.
Rare gasses like neon play a vital part in the semiconductor manufacturing process. Neon gas is the main gas used in excimer laser, a production device used in the chip-making process called photolithography, which uses lasers to “print” circuits onto silicon wafers, the foundation of a semiconductor.
Rare gasses, when energized, emit light, which makes them essential in electronic lumination units. Rare gas mixtures are also used as filling materials to produce lasers, with such devices needed to be replenished routinely. And neon discharges are the most efficient of all rare gasses in producing visible light.
Rare gasses or noble gasses are so named because they are rare compared to other elements. Helium, neon, argon, krypton, and xenon comprise these rare gasses listed in the rightmost column of the periodic table of the elements. These elements cause almost no chemical reaction with others, and, for this reason, are regularly used as shielding gasses in industrial production.
The price of neon has risen more than 10 times since the Russia-Ukraine war, while krypton price rose more than 44% since mid-February.
Ren Lu, an industrial gas expert, told the state media Global Times in mid-February that China has achieved a breakthrough in rare gas productions, and the country can now purify rare gas. Ren added that the Russia-Ukraine war would only lead to a short-term price rise.
Rare gasses like neon, krypton, and xenon are also a side product of the steel industry. Being a top global steel producer, China can expand its rare gas production to fill in gaps that Ukrainian producers have left.
China produced 1.06 billion tons of raw steel in 2020, ranking first worldwide, 10 times the amount produced by India, the second-largest steel producer in the world. Russia ranked fifth place, with raw steel production of 71.6 million tons.
On Feb. 17, Chinese gas company Yingde Gases announced a plan to expand its xenon and krypton production, while the Hangzhou Oxygen plant group stated that its new xenon and krypton production devices will be used later this year.
China doesn’t provide a detailed breakdown of its rare gas industry, but a look at China’s electronic gas industry offers clues. Electronic gas is a category that looks at gases used in the production of electronics, consisting of high purity rare gasses and other compound gasses.
China’s production of gasses used for electronic production grew 23% year-on-year in 2021, reaching a market size of RMB 21.6 billion. 62% of China’s electronic gas is used to produce semiconductors, of which 43% are used in integrated circuits, and the rest goes to make photovoltaic and LED circuits, according to Yidu Data.
The country’s electronic gas market is also highly concentrated and controlled by foreign companies, with the top five firms taking an 85% share of the entire market in 2020. They are US-based Airproducts, US-based Praxair, France-based Airliquide, Japan-based Taiyo Nippon Sanso, and German-based Linde.
There are four main electronic gas producers in China: Huate Gas, Jinhong Gas, Nata Opto-electronic Material, and Yoke Technology. Huate Gas provides neon to ASML, the global lithography giant from the Netherlands. Jinhong Gas is capable of producing Xenon, as noted on its official website. Jinhong will start supplying electronic gas to China’s top chipmaker Semiconductor Manufacturing International Corporation in April. However, these four companies only accounted for a tiny fraction of the market share, accounting for only 6.27% of China’s total special gas supply. Special gas is a broader category that includes electronic gas, which includes rare gas.
In addition, Kaimeite Gasses, a neon gas supplier based in the central Chinese province of Hunan, announced last week that they are in talks with ASML and expediting the process.
JD becomes the latest Chinese tech majors to begin wide-scale layoffs. Jingxi, the e-commerce giant’s bargain commerce and community group buy business unit, is seeing a cut of 10% to 15%, Chinese media outlet 36Kr reported Tuesday, citing unnamed sources familiar with the matter.
Why it matters: JD’s layoff reflects the ongoing economic downturn in China and a waning interest in the country’s community group buy sector.
Details: JD’s layoff will affect at least 400 to 600 staff in the Jingxin unit, according to sources quoted by 36Kr. Jingxi employs about 4,000 staff.
Context: JD joins a growing list of Chinese tech giants cutting staff to stay competitive in an economic slowdown. Since late last year, Alibaba, Baidu, ByteDance, Kuaishou, and Tencent have all begun to lay off people.
Chinese tech unicorn ByteDance has acquired no-code startup Hipa Cloud, a company that focuses on customized enterprise management systems, Chinese media outlet 36Kr reported on Monday. The acquisition appears to boost ByteDance’s enterprise software as a service business and transform the competitiveness of Feishu, its Slack-like messaging tool for businesses, in a sector currently dominated in China by Alibaba’s DingTalk.
Why it matters: ByteDance’s short video app Douyin (TikTok for the overseas market) has given the company huge success with its customer-facing business. Yet Feishu (Lark for the overseas market) has thus far failed to replicate that success in the enterprise-facing services sector. The acquisition of Hipa seems to be an attempt to change that.
Details: Founded in 2019, Hipa Cloud focuses on no-code development platforms for enterprise clients, assisting them in developing customized management systems.
Context: ByteDance first developed the Slack-like Feishu as an internal team collaborative management tool in 2016, launching it as a business in 2019.
Livestreaming fraud, forced app downloads, intrusive ads, and privacy violations were among the malicious online practices exposed during this year’s “3.15 Gala” national TV broadcast.
Unlike previous March 15 shows, yesterday’s Consumers Rights Day celebration didn’t single out Apple, Alibaba, Baidu, or any other high-profile companies or brands for reprimands. The offenders this year were little-known small fry.
This gala’s subdued tone reflects Beijing’s desire to stimulate consumer spending and economic growth, even as the country struggles with a rising wave of COVID-19 outbreaks and geopolitical pressures.
China’s 2021 GDP growth took a notable hit in the latter half of the year. Averaging out at 8.1%, growth tumbled from 18% in the first quarter to 4% in the fourth quarter. In between, regulators began a broad crackdown that eliminated or crippled internet industries, including crypto mining, private education, and online games.
READ MORE: INSIGHTS | Making sense of China’s big tech crackdown
In its 31st annual outing, the two-hour program spotlighted some obscure companies engaging in a dark side of e-commerce livestreaming, a sector that’s under intensified scrutiny by the state.
One segment showed how undercover CCTV reporters discovered a Guangdong livestreamer’s false claims of owning jade and emerald factories with the aim of grossly inflating prices and selling counterfeit jewelry and Buddha images. The Guangdong agency, Yongdexiang, was shown selling jade Buddha images for RMB 198 ($31) while telling customers the items had been purchased for double that amount. In fact, Yongdexiang had bought them for RMB 88 each. Livestreamers’ selling price could sometimes be as high as five to ten times their original purchase price.
A livestreaming agency in Yunnan province called Shilipai set up a dramatic price bargaining scene between livestreamers and fake jade ornament manufacturers. The purpose was to convince viewers they were being offered the best deal. Other scenes featured artificial backdrops in the livestream that resembled a Myanmar gemstone showroom. Customers thought they were buying jade directly from the Southeast Asian country famed for its high-quality jade. In fact, the livestreams were being staged from studios in office buildings in Kunming.
The gala also showed companies grossly misusing people’s personal information. A Zhengzhou-based company called Lvqian was exposed for building a business around stealing users’ phone numbers and selling them to call centers. The company was able to steal the phone numbers by getting a device’s media access control address, a common network address also known as the MAC number. MAC numbers’ unique identifications are assigned to devices for internet access.
Some smartwatches made for kids were also revealed to have little privacy protection because they use outdated Android operating systems (OS). As a result, they enable hackers to collect detailed user information without permission. Without timely security patches, an outdated OS can even enable eavesdroppers to surveil users. Devices with an outdated Android OS are common in China since Google services were blocked in China in 2010.
A few software companies that trick users into downloading malicious software to mobile and desktop devices were also exposed in the TV consumers gala. Malware that displays low-quality ads in forced pop-ups may be a mere annoyance, but some types can steal users’ privacy information or trick users into downloading even more harmful programs. This year’s “3.15 Gala” finally shone light on abuses consumers have been complaining about for the better part of a decade.
An app called “Free Wi-Fi Unlocker” tricks users looking for ways to access password-protected Wi-Fi systems. Once they download the app, it forcibly installs ads on their devices. Baizhu, a small software company founded in 2012, was exposed for building the so-called speed downloader options on various sites and app stores, tricking people into downloading malicious apps and intrusive ads.
After the TV exposé, Free Wi-Fi Unlocker is now inaccessible across all app stores. Baizhu emptied its social accounts after the gala and local authorities are reportedly looking into the company.
Following Consumers Day, China’s Ministry of Industry and Information Technology said in a March 16 statement that the agency will finally start thorough investigations of companies involved in leaking personal information or forcing malicious software onto users’ devices, citing the Personal Information Protection Law, Cybersecurity Law, Telecommunication Regulations, among other regulations.
]]>On Thursday, the US-traded shares of major Chinese tech companies saw steep drops as the US Securities and Exchange Commission (SEC) named several Chinese companies that face delisting.
The Nasdaq Golden Dragon China Index, which tracks stocks of Chinese companies listed in the US, plummeted by as much as 10% on Thursday to 6,535 points, the biggest slide since October 2008, Bloomberg reported.
Shares in more than 10 US-listed Chinese tech companies fell more than 10%. For example, iQiyi dropped 21.71%; Pinduoduo fell 17.49%; Bilibili 14.10%; NIO 11.90%; Parkson China 10.94%. Alibaba and Xiaopeng dropped by 7.94% and 9.01%, respectively.
Why it matters: The market sell-off is a sign that investors are taking notice of a tougher stance from the US stock market regulator towards US-listed Chinese companies.
The SEC said Thursday that five Chinese companies, fast-food chain Yum China Holdings, biotech groups BeiGene, HutchMed Limited, Zai Lab Limited, and technology firm ACM Research, may face delisting for failing to disclose information, according to the Holding Foreign Companies Accountability Act (HFCAA).
The US passed the act in 2020, but this is the first time that the SEC has threatened companies of an actual delisting. The five named companies can submit evidence disputing the commission’s charges until March 29.
According to the act, Chinese companies and their auditors would have to open their books to US inspections, which companies like Alibaba and Baidu had previously refused to do.
READ MORE: US-listed Chinese firms are on thin ice
Politics or financials: Responding to the SEC’s delisting warnings, the Chinese government said it welcomes measures to improve companies’ financials but is “against politicizing securities regulations,” according to a Friday response from the China Securities and Regulatory Commission.
Some analysts think SEC’s move is more about politics than the companies’ financials. “Most things are about politics now, both in China’s own domestic securities regulation, or US-China securities regulation disagreement,” Ren Liqian, director at exchange-traded fund sponsor and index developer WisdomTree Investments, said in a Friday Twitter post.
She expects the SEC list to grow as more companies report 2021 annual earnings in which the auditor information is used.
Tech companies that released their fourth-quarter earnings from last year took the brunt of the market blow. On Thursday, JD shares sank 16% even though its Q4 earnings beat market expectations. Shares of Ke Holdings slumped 24% after posting a Q4 report, which investment bank Jefferies considered a “turnaround story.”
“Today’s company earnings numbers are also not bad”, Ren noted. “It’s less about this year’s fundamentals, but how much the US wants to tie Chinese companies to Russian sanctions and future impact on fundamentals,” she posted.
Meanwhile, the incident may further boost the Hong Kong stock exchange, a popular alternative to the US market for Chinese tech companies. Since Alibaba launched a dual listing in Hong Kong in 2019, many Chinese tech firms started to look to list closer to home amid the backdrop of escalating tensions between China and the US. This homecoming trend grew stronger after Luckin’s fraud scandal.
]]>The annual meetings of the National People’s Congress (NPC) and the advisory Chinese People’s Political Consultative Conference (CPPCC) being held this week are most important for the windows they provide into the government’s economic targets and policy priorities in the coming year.
But the so-called “two sessions” meetings also enable some top private enterprise executives who are members of the two bodies to present recommendations for policy directions publicly. This year, airing perspectives from tech industries were founders of Tencent, Baidu, NetEase, Xiaomi, and Geely. Their recommendations perhaps won’t be taken up by government authorities this year but might merit serious official consideration in future years.
READ MORE: China’s Two Sessions 2022: More 5G, rural e-commerce, semiconductors, and other tech priorities
In his ninth year as an NPC delegate, Pony Ma, founder and CEO of Tencent, urged more emphasis on the digitalization of pillar industries, standardized processes, and customized support for specialized high-tech enterprises. He also warned about the market risks inherent in the emerging sectors of the metaverse, non-fungible tokens (NFTs), and Web 3.
With regulatory risks remaining a major concern for tech giants, the billionaire’s comments largely aligned with the government’s bigger picture initiatives ranging from digital transformation to the call for large enterprises to fulfill their social responsibilities and work toward carbon neutrality. Ma made no comments about online gaming, a key revenue source for his company and an area in which many other delegates advocated for harsher regulation.
Ma also called for the government to build a social emergency network for sending disaster warnings and coordinating rescue resources by learning from the flood relief experiences in Henan and Shanxi last year. He suggested mobilizing local groups like community volunteers, food and package delivery workers, and ride-hailing drivers to be trained for natural emergencies.
Robin Li, founder and CEO of Baidu, focused his remarks on autonomous driving and green computation. He urged the government to give more support so China can take the lead in commercializing fully autonomous driving. Specifically, he suggested government support for companies testing autonomous cars without safety drivers, preparing roads for automated cars, and building smart transportation infrastructure.
Li also proposed the creation of more green AI services as a way to achieve China’s goal of reaching carbon neutrality by 2060. China should optimize AI algorithms to minimize carbon emissions and develop big models that cut energy consumption. He also recommended public data centers set up ways to measure their carbon emissions.
According to NetEase founder and CEO Ding Lei, building a global intellectual property (IP) platform for exchanging cultural IP, digital video, and musical content should be a national priority. It’s an area that NetEase, the parent of popular music and video streamer NetEase Cloud Music, has already tapped this year with the launch of the beat trading platform BeatSoul in January.
Ding also called for more research on sodium-ion batteries as an alternative to the more popular lithium-ion ones to lower the price of batteries. In addition, recycling and rental services for lithium-ion batteries were also proposed as possible measures to address the issue.
Lei Jun, co-founder and chairman of Xiaomi, recommended the government improve consumer electronic waste recycling and set unified standards for monitoring carbon emissions of new energy vehicles (NEVs). Not coincidentally, the smartphone maker made plans to build its own electric vehicles last year.
Lei called to consolidate three core processes (trading of used products, reproducing, and scrap dismantling) into one recycling system. Government should pay more attention to safeguarding former owners’ privacy in the recycling process, Lei said, by setting up third-party organizations to erase personal data found in second-hand devices.
Lei urged the government to build high-voltage fast-charging stations for NEVs on a large scale. He also suggested the government build a national platform to help different companies jointly develop fast charging and other essential techs.
Li Shufu, founder and chairman of automaker Geely, proposed that battery-swapping stations be built across the country, so more people could adopt NEVs without worrying about finding charging stations.
Li called for regulators, industry groups, and market players to establish unified and generalized standards for swapping technologies. The government should green light rules to speed up approval for swap stations’ land use and cut red tape involved in getting permits to sell swappable electric vehicles (EVs), Li said.
Although Tesla CEO Elon Musk views battery swapping as an “unlikely” solution and many others worry about the technology’s scaling problems, Chinese companies are jumping into the market in the hope that the service can work at scale in the world’s biggest EV market. Separation of the battery from the vehicle, along with battery-leasing options offered by carmakers, could also reduce the upfront purchase price of EVs, which could increase competitiveness and boost adoption. Beijing showed its support for the technology by defining swap stations as complementary to charging facilities in its “new infrastructure” investment plan for 2020.
]]>Beijing this year aims to expand 5G infrastructure, set up a national system of data centers, keep a tight regulatory grip on big platforms, and push e-commerce in rural China, according to goals set forth this week at the annual lianghui (“two sessions”) meeting of the National People’s Congress (NPC) and the Chinese People’s Political Consultative Conference (CPPCC).
China plans to bolster the tech sector by increasing state funding in key areas such as chip manufacturing and improving the capital market so more tech firms can raise money domestically. Having a growing and self-sustained tech sector is central to the government’s plan to achieve these set targets, according to government reports presented in the meeting.
Given the ongoing surge in the pandemic in China, an economic slowdown, and uncertain global geopolitical pressure, many of the goals for 2022 will be particularly challenging to achieve. The GDP growth target of 5.5% is ambitious, despite being the lowest in a decade (It was 6% last year; no target was set in 2020 due to the pandemic).
Members of the NPC and CPPCC, the nation’s top legislative bodies, meeting from March 5 to March 11, emphasized the need for a stable growing economy as China prepares to host the all-important 20th Party Congress in autumn. This year is also the second year in China’s 14th Five-Year Plan (2021 to 2025), which is set to make the country wealthier and more equal, growing China’s per capita GDP to the level of moderately developed nations and expanding its middle-class.
Achieving self-sustainability in semiconductors and strategically important areas such as AI, biotechnology, and advanced manufacturing tools and machines are high on the government’s priorities. The government will fund small startups that possess innovative tech in the manufacturing, fostering what they called “little giants,” according to the Ministry of Finance’s report filed to the meeting and released to the press.
New energy vehicles will continue to be embraced. The government aims to build more green energy power structures to ease its reliance on fossil fuels. In key growth areas like Beijing, Shanghai, and Guangdong, the state will fund national laboratories and tech innovation hubs to attract tech talents.
China will “promote the development of venture capital,” Premier Li Keqiang said on March 5 at the opening of the six-day NPC assembly. The remarks sent an assuring signal to worried tech venture capitalists after China’s year-long tech crackdown erased trillions of dollars in market cap from Chinese tech majors like Alibaba, Didi, and Meituan. However, the country will still be mindful of the systematic risks brought by “unregulated and disorderly expansion of capital,” Li said in the government work report.
Despite the fears spawned by last year’s regulatory crackdowns, venture capital investments in China jumped almost 50% from $86.7 billion in 2020 to a new record of $130.6 billion for 2021, data from research firm Preqin shows. However, venture capital pivoted to financing hard tech areas like semiconductors and robots rather than highly-regulated areas like edtech.
In addition to leveraging venture capital, the country plans to improve the operation of public capital markets by reforming China’s new third board, an over-the-counter share trading platform serving small and medium enterprises (SMEs). China made the first step of reform by launching the Beijing Stock Exchange last November, targeting small tech startups and enhancing the connectivity of the multi-level capital markets.
Regulatory crackdowns on large internet platforms will likely continue this year, as the Supreme People’s Procuratorate, the state’s prosecutor, said in the NPC that it plans to closely monitor anti-monopoly, anti-competitive behaviors, and guide the capital market to orderly development.
China plans to construct more 5G stations and further utilize data as a critical national resource to bring more value from its increasingly digitized economy. China’s economic planner, the National Development and Reform Commission (NDRC), said in a report released to the assembly that it will launch several “major infrastructure projects,” building 5G networks, artificial intelligence (AI), and an integrated national system of big data centers.
China elevated data to one of the key economic resources in the 14th Five-Year Plan released last year. In 2021, China laid the groundwork for keeping data secure with a slew of regulations. This year, it will further the work to allow data to be better classified and defined to better share and trade data, said the NDRC report.
As China faces continued weak consumption in 2022, the government hopes to compensate by expanding rural e-commerce. The government work report proposed to strengthen the construction of business ecosystems in county-level communities and to improve rural delivery services. The economic planner’s report shows that express delivery services now cover more than 80% of the country’s administrative villages, which will “further unleash consumption potential in rural areas.”
In 2021, China’s total online retail sales increased 14% year on year to RMB 1.3 trillion ($206 billion), or 30% of China’s overall retail consumption of RMB 4.4 trillion, according to NDRC’s report.
In addition, the economic planner wants to boost cross-border e-commerce as part of its efforts. For example, China plans to expand the scope of the pilot scheme for cross-border e-commerce retail imports and started planning on building seaports, inland ports, and overseas warehouses.
In 2021, manufacturing accounted for 27.4% of China’s GDP. The country aims to upgrade this key sector by nurturing homegrown startups specializing in robotics, automation, industrial software, and other smart manufacturing tools.
Since the US-China trade war in 2018, China has rushed to reinforce its manufacturing supply chains and make sure it doesn’t rely too much on foreign supplies in core technologies. China has funded more than 4,700 startups since 2021 and plans to invest in 3,000 more this year.
The government called the state incubation the “little giants” project, setting out to give out RMB 10 billion ($1.58 billion) over the years to fund startups in key manufacturing areas. These areas include high-end machine tools, aerospace equipment, marine engineering equipment, advanced railway equipment, electric power equipment, new materials, biomedicine, and high-end medical equipment.
China’s semiconductor industry has seen an exponential increase in investments and government support since 2019, as the country’s top chipmakers faced US sanctions. The government vowed to rely less on foreign technology in its chip production, but the complexity of this high-tech industry means China’s pursuit of self-sufficiency will be a long-term effort.
The government vowed to keep throwing money and support into this effort. China’s Ministry of Finance said in its report to the NPC assembly that it would channel funds to the integrated circuits industry through market measures. It would also give tax cuts to the chip industry, alongside other sectors like industrial mother machines, 5G, biotech, and agricultural equipment.
The NDRC said it will guide semiconductor makers to gradually expand their production, stabilize supply chains in and outside of China, and will help them connect with suppliers. It also vowed to pay close attention to raw materials prices, helping suppliers and manufacturers secure production resources.
Chinese policymakers have faced significant challenges as they tried to meet ambitious carbon reduction goals over the last year, ranging from heavy reliance on coal to a nationwide power crisis.
China will continue its efforts to reduce the use of coal and promote renewable energy sources, according to the government work report. And yet, the moves to reach its emissions peak will be done “in a well-ordered way,” Li said, adding that energy supply will be ensured “in accordance with overall planning,” in addition to efforts to build wind and solar power plants.
Last year, the central government imposed strict measures by enforcing energy consumption mandates and intensity limits. As a result, at least a dozen Chinese provinces introduced power cut measures in September. This, along with soaring energy prices, forced many factories to reduce or even halt their operations late last year.
Beijing will also push the country’s EV industry forward to drive consumption and cut carbon emissions. The NDRC, the economic planning agency, said in its report that it will continue to boost purchases of NEVs and build more battery charging and swapping facilities. Meanwhile, the Ministry of Finance pledged to maintain subsidies and tax exemptions for NEV purchases.
]]>Several Russian banks are planning to use China’s bank card service UnionPay as US services Visa and Mastercard suspend services in Russia, according to Reuters. Russia-issued credit cards using the Visa and Mastercard systems will stop functioning after March 9, part of a broader global economic backlash over the ongoing Russia-Ukraine war.
Why it matters: China could face more geopolitical pressure from the US. The country has toed a diplomatic line since the conflict began in late February, advocating for peaceful resolutions (in Chinese).
Details: Russian banks, including Sberbank, Alfa Bank, and Tinkoff Bank, will use China’s payment system UnionPay to issue credit and debit cards.
Context: Russia launched what it called “a special military operation” on Ukraine on Feb. 24. Since then, the country has received a series of financial sanctions from the US and its Western allies.
China’s IT regulator urged tech companies to stop forcing users visiting web versions of their services to download apps in a Thursday meeting.
Why it matters: The suggestion could cut profits from major internet companies as they might see app users and data decrease. Chinese internet companies often use their web applications to attract new users to mobile apps, from which they can collect users’ information and promote products more easily, especially after browsers start to set a stricter countermeasure to protect users’ privacy.
Details: The regulators made the urge following a public complaint. On Feb. 11, a user complained that many tech companies forced people to visit a mobile web version of their services to download apps, according to a complaint posted on state media People’s Daily’s leadership message board. The board allows users to post suggestions for leaders of relevant ministries in China. The Ministry of Industry and Information Technology (MIIT), China’s administration for the IT industry, responded to the complaint, promising they would conduct in-depth research on forced app installation.
On March 2, Chinese regulators published a new draft of rules on notifications and pop-ups. The rules hope to stop Chinese apps’ excessive use of the tools and control what content gets shared in the notifications.
Why it matters: Chinese tech companies widely use notifications and pop-ups to promote their services. New rules curtailing their use could hurt service providers such as Baidu, Tencent, and Meituan, which rely on such methods to promote their products and generate profit from advertisements.
Details: The Cyberspace Administration of China (CAC), the country’s internet regulator, has published the draft rules as part of a public consultation period until March 17.
Context: The draft regulations appear to be part of a coherent effort to “clean up” the Chinese internet content offerings after CAC’s new algorithm rules took effect at the start of March.
NetEase plans to seek further partnerships with Microsoft and Activision Blizzard as it eyes overseas expansion, the company’s CEO Ding Lei said on a Thursday earnings call.
Why it matters: NetEase is looking to expand its gaming business overseas as its domestic business faces regulatory uncertainty. As China’s second-largest gaming company, NetEase’s move is indicative of an industry trend.
Details: NetEase said it plans to expand its games outside of China. The company is also seeking to diversify its gaming offering, promising to build new games in the metaverse and for established consoles.
Context: NetEase’s online game services reported RMB 17.4 billion in net revenue for 2021, a 29.8% yearly increase, making it the company’s fastest-growing unit, according to its Q4 earnings released on Thursday. The Q4 growth rate is almost double the gaming unit’s annual growth rate of 15%.
China’s gaming companies are cutting off projects and staff as the industry still lacks permission to release new games, Chinese media outlet Hongxing News reported on Tuesday.
Why it matters: China’s gaming industry has achieved steady growth despite increased regulation, with the actual sale revenue of self-developed games in the domestic market reaching RMB 255.8 billion ($40.4 billion) last year. However, the growth rate dropped sharply from 26.7% to 6.5% since 2020, according to a China Audio-video and Digital Publishing Association report.
Details: News about Shanghai gaming industry leaders laying off workers and cutting projects began to circulate on the Chinese internet in the past few days. Companies like Netease, Baidu, Lilith, IGG, and Perfect World have made cuts, Hongxing reported.
Context: The last batch of games approved by the NPPA were granted licenses last July, seven months ago. The Chinese gaming industry was hit with a similar freeze in 2018, when new game approvals were stopped for nine months.
China Broadcasting Network (CBN), a new state-backed 5G operator, announced on Feb. 17 that it will start operating a new line of mobile network services from mid-May.
Why it matters: CBN is a newcomer to China’s telecom market and faces competition from three established state carriers (China Mobile, China Telecom, and China Unicom). Compared to existing players, CBN has access to an extensive broadcast content library.
Details: CBN announced on Feb. 17 that it will start operating a new mobile phone number network from mid-May. It will issue cellphone numbers that begin with 192.
Context: Formed in May 2014, CBN was approved by the State Council, China’s cabinet, and funded by the state.
Of the three established Chinese telecom providers, China Mobile leads the 5G market with 386.8 million users, China Unicom follows with 187.8 million, and China Telecom has 154.9 million, according to C114, a Chinese media platform focused on the telecoms industry.
]]>As Beijing prepares to close the 2022 Winter Olympics, TechNode selects five notable pieces of technology built by Chinese companies that left an impression during the two-week games.
Two Chinese display manufacturers, Leyard and BOE, supplied the floor display screen for the opening ceremony. BOE also provided power-saving athlete nametags. Baidu Cloud and other startups developed a virtual host to translate sign language. Alibaba Cloud provided high-definition panoramic footage for selected games. Remote-controlled beds built by Chinese company Keeson became a social media hit during the game, while iFlytek provided live translation services with a 95% accuracy rate.
For the Feb. 4 opening ceremony, Chinese display maker Leyard and BOE supplied most of the screens used in the 100-minute program. Leyard, which was also the supplier for Beijing Olympics in 2008, provided most of the displays used in the ceremony. On the other hand, BOE designed the giant snowflake and the rest of the floor display.
The two companies together supplied a ground screen system with 8K resolution. The ground display covered 10,393 square meters (largest in the world) with 8K resolution, 100,000:1 ultra-high contrast (100 times the average display), and a 3840Hz refresh rate (30 times the average).
BOE also built a power-saving nametag that could charge via phone. The tag is an E-ink screen, which consumes little power for its feature. E-ink requires power only when users need to change the display content, and it tends to have a longer battery life than traditional smartphone screens. The tag does not contain a battery. Instead, it charges wirelessly through phones, using near-field communication tech, which comes with most smartphones.
Another unique part of this name tag is that the screen could display red color, while the traditional E-ink screen displays only black and white colors. In addition, the tag could display more vivid content with three colors.
China’s state broadcaster CCTV developed a virtual host named “Ling Yu” to translate sign language with Chinese tech companies Baidu Cloud, Zhipu AI, and Luster. Zhipu and Luster are artificial intelligence startups. Zhipu mainly develops virtual humans and enhances them with AI and data, while Luster focuses on computer vision and imaging, giving the virtual host a presentable look. The sign-language translator has an elegant look, appearing on all CCTV broadcasts.
Virtual humans have gained great popularity in the investing circle and are seen by some companies as an essential part of the metaverse.
Alibaba Cloud, the cloud service unit of the Chinese e-commerce giant, supplied live game footage for the Olympic games. The 2022 Beijing Winter Olympics chose to store and transfer live footage through cloud services rather than traditional transmission methods, the second Olympics to do so, after the 2021 Tokyo summer games. The cloud system eliminated the need for media outlets to bring in satellite news trucks and customized networks.
The cloud unit also provided special panoramic views in curling and speed-skating games. The view allowed users to adjust the point of view in a 360-degree panoramic video. Called the bullet time, the visual impression is named after the science fiction cult movie “The Matrix” and gives viewers an immersive experience.
Alibaba Cloud delivered more than 6,000 hours of live footage via its cloud system to media outlets worldwide. The cloud subsidiary became the International Olympic Committee’s exclusive cloud network provider in 2017.
Chinese company Keeson supplied 7,000 smart beds for the Olympic Village. These beds come with a foam mattress and a remote controller with eight functions, allowing athletes to easily change sleeping positions and mattress support levels.
US luge athlete Summer Britcher helped create an online discussion about the bed when she uploaded a TikTok video comparing the bed’s comfort level with the cardboard bed used in the 2021 Tokyo Olympic Village. Britcher called the smart bed’s Zero-G mode “phenomenal.” The bed-maker Keeson said the Zero-G mode adjusts the level of the head area a little lower than the foot area, minimizing heart pressure and helping people to relax.
Keeson delivers more than 90% of its products to overseas, including North America and Europe.
Chinese voice recognition company iFlytek provided full translation services for the games, with portable translation terminals, recording pens, remote meeting systems, and more.
The company’s service can translate more than 60 languages in verbal communication, including voice recognition and synthesis, according to the company’s announcement. The system can imitate a human-like voice when translating verbally using voice synthesis technology while using voice recognition to help the machines to understand human language. The company said it can achieve up to 95% accuracy when translating between Chinese and other major languages. For context, Google translation has an average accuracy of 81.7% when translating between Chinese and other languages in medical situations, according to a study conducted by the UCLA Medical Center and the Memorial Sloan Kettering Cancer Center in New York.
]]>Note: This article was first published on TechNode China (in Chinese).
ByteDance, one of China’s newest tech giants, caused an uproar in the venture capital circle when it dissolved its strategic investment department on Jan. 18, reassigning at least 100 employees in the process.
The company said the move aimed to move staff into different units to strengthen internal collaboration. However, outsiders have speculated that the move, along with changes to the company’s investment strategies, represents an urgent shift from ByteDance as it looks to abide by China’s anti-monopoly regulations.
ByteDance’s decision and other Chinese tech giants’ recent moves to divest investments signal a change in China’s corporate venture capital funds (CVCs). They are downsizing after being major players in the capital circle for more than a decade and having nurtured promising startups to success.
From 2010 to 2019, the top 10 companies in China’s equity investment market by CVC investment amount were Tencent, Alibaba, Fosun Group, JD.com, Baidu, SoftBank Group, Qihoo 360, Ant Financial, Suning Group, and Sunac China, half of which are CVCs in tech companies. In 2019, 10 industrial groups, including Tencent, Alibaba, Baidu, and Ant Financial, invested RMB 90.467 billion ($14.23 billion) in total. CVCs accounted for nearly 80% of their total investment during the same period.
CVC investment in China can be traced back to 1998, a relatively late start compared with other countries. During that first decade, Chinese CVCs remained in a tepid state. However, in 2010, Chinese CVC investment began to develop, as traditional industry giants and tech companies started to establish their strategic investment departments.
Since 2015, under a government policy of encouraging entrepreneurship and innovation, Chinese CVC investment began to accelerate. During this period, the number of corporate venture capital institutions peaked at 170. In addition, the scale of startups and the amount of investment also expanded significantly. Since 2016, the total investment of Chinese CVCs has been on par with independent venture capital.
CVCs can generally be divided into two categories, the traditional enterprise CVC, and the tech one.
In traditional industries, manufacturing is the backbone of CVC entities, with these companies typically involved in media, games, real estate, medical care, logistics, automobiles, and consumer electronics.
Companies behind tech CVCs usually fall into two distinct groups: older tech giants like Tencent, Baidu, and JD.com, and newcomers focused on mobile devices like Bilibili, ByteDance, and Xiaomi.
Chinese tech CVCs have continuously driven the development of the real economy while serving the strategic development of their parent companies, becoming an essential part of China’s capital market.
Today, tech companies account for 20% of CVC companies in China, contributing a sizable part. Data shows that many CVCs within tech companies have been more active in foreign investment than those in traditional companies.
Take ByteDance as an example:
ByteDance mainly invested in content industries related to its own business in its early days. As traffic on the short-video platform Douyin (TikTok’s China version) began to peak, ByteDance sought growth in other areas by investing in education, consumption, e-commerce, medical care, finance, games, and even more niche areas like business-to-business services and hard tech.
Data shows that ByteDance has invested in 193 projects since its establishment and has increased the number of foreign investments every year since 2019. ByteDance invested in 64 companies in 2021, with a cumulative investment amount of nearly RMB 35 billion, which accounts for almost 10% of ByteDance’s total revenue in 2021, according to enterprise database Qi Chacha.
Tencent has one of the most successful CVCs in China. The company’s investment department was established earlier than most CVCs in China. Tencent is also a stakeholder in many well-known Chinese tech companies.
Tencent (including its sub-companies) had made more than 1,180 investments as of December 2021, IT Juzi data showed. Tencent invested in 250 companies in 2021 alone, more than the sum of Baidu, Alibaba, 360, JD.com, Xiaomi, ByteDance, and Bilibili. According to data shown in its Q3 report, Tencent’s 2021 investment projects are valued at RMB 1.75 trillion, which is almost equivalent to the total GDP of China’s northern Shanxi province (home to around 35 million people) in 2020.
Tencent prefers investing in pan-entertainment media industries, especially the gaming industry, one of its main business lines. The company is also heavily involved in corporate services, finance, education, healthcare, and new food and beverage chain brands.
As ByteDance disbanded its CVC (which it called strategic investment department), copies of apparently official regulatory documents called “Rules of Practice for IPO and Investment of Tech Companies” (our translation) began to spread on the Chinese internet. The files showed that tech companies who want to conduct IPOs, or seek investment or fundraising will need to seek approval from China’s internet watchdog Cyberspace Administration of China (CAC) if they meet two standards: they either have more than 100 million users or more than RMB 10 billion in revenue in the past year, or, deal with sectors heavily regulated, such as media and financial services.
Many commentators believe the document caused ByteDance to dissolve its CVC department, despite CAC denying issuing such a file. However, as Chinese regulators keep up the anti-monopoly crackdowns on top tech companies, many firms will look to cut down their strategic investments to err on the side of caution.
Even before ByteDance dissolved its strategic investment department, other tech majors had already begun to cut ties with invested companies.
Alibaba Group first sold its 5.62% stake in media firm Caixin in 2019 and withdrew its investment from Mango Excellent Media ahead of schedule in September 2021 with a loss of RMB 2.3 billion. Daniel Zhang, the CEO of Alibaba, stepped down as board of directors at both Didi and Weibo in late 2021 and early 2022.
Meanwhile, Tencent began reducing its shares in JD.com by paying a mid-term dividend; it later announced that it would reduce its 2.7% stake in Sea, the largest tech company in Southeast Asia, and give up its super-voting rights, with a total divestment of $3.1 billion.
Tech giants’ CVCs have played a positive role in China’s platform economy, but at the same time, they have stifled small and medium-sized startups’ development, says Hu Jiye, a finance professor at China University of Political Science and Law. Top tech companies have sometimes forced startups to follow their strategy by holding shares and suppressing competition, Hu added, stating that startups can only survive by abiding by the rules set by these tech giants. The Chinese government considers this behavior disorderly expansion and the abuse of the companies’ dominant market position.
Hu believes that the voluntary contraction of tech CVCs could benefit small and medium-sized enterprises and that Chinese CVCs will enter an era of regulated development, leaving behind an unregulated era.
]]>Most popular Chinese female-oriented online games released new content to celebrate Valentine’s Day and attract new players.
Why it matters: So-called otome (“maiden” in Japanese) games target female players and are predominantly designed as role-playing games (RPG) or simulation games. Gaining in popularity in China since 2017, these online games cater to female players’ emotional needs by offering various romantic fantasies. Valentine’s Day has become the most popular annual event for these game makers.
Details: Eight out of the top 10 otome games listed on TapTap, a game review platform and player community, released special content for Valentine’s Day.
Context: Valentine’s Day has become the most popular and profitable holiday for Chinese otome game makers. It is followed by May 20, a date which sounds like “I love you” in Chinese. Third-ranked is the Qixi Festival, China’s traditional Valentine’s Day. It falls on the seventh day of the seventh month of the lunar calendar. All three are lucrative holidays.