Alibaba, a prominent Chinese tech company, had been subject to control by the ruling Communist Party. However, the Asian Games taking place in Alibaba’s hometown are presenting a valuable opportunity.
As reported by AFP, established by Jack Ma nearly 25 years ago in Hangzhou, Alibaba is crucial for the Games as it operates the event’s cloud computing system, without which the multisport extravaganza would likely face disruptions.
Demonstrating Alibaba’s apparent return to prominence, at least temporarily, organizers are arranging excursions for journalists to visit the company’s campus, recognizing it as “a pioneer in China’s Internet economy.”
Alibaba possesses the Dingtalk platform, akin to Slack, utilized by the Games’ workforce, and the Alibaba-affiliated Alipay stands as the sole Chinese digital wallet accepted at the venues.
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Alibaba’s collaborative agreements with the Games were established prior to the formal crackdown designed to control China’s rapidly growing tech industry. The Games now represent a valuable opportunity for Alibaba to enhance its reputation once more and for its representatives to engage with political, business, and sports figures from various regions, including China, Asia, and other parts of the world, AFP reported.
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In 2020 Alibaba became the country’s first tech giant to bear the brunt of increased oversight.
Chinese authorities called off what would have become one of the most valuable public listings in history — valued at $34 billion — for its former subsidiary and Alipay owner Ant Group.
One month after officials hit the brakes on Ant’s IPO, Alibaba was investigated for alleged anti-competitive practices, then issued a fine of $2.8 billion. In the subsequent months, a series of actions taken against other technology companies resulted in substantial reductions in the market capitalizations of key industry players, amounting to billions of dollars in losses, AFP noted.
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Regulatory authorities focused on these companies, imposing fines and introducing regulations across various sectors, including music streaming applications, online shopping, and ride-hailing services. These measures were justified on grounds of national security and anti-trust considerations.
Prominent tech leaders, particularly the charismatic figure of Jack Ma, moderated their public conduct as Beijing became apprehensive about their growing influence and tendency to challenge the established order. According to experts, government officials have subtly adjusted their stance in recent months, loosening their control as the Chinese economy faces challenges associated with declining growth, AFP reported.
Chinese premier Li Qiang in July called for government departments to “create a fair and competitive market environment… and improve transparent and predictable regulation to push for the healthy development of the industry”, according to state-run CGTN.
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Alibaba isn’t the sole Chinese digital economy participant seizing the spotlight at the 19th Asian Games held in Hangzhou, considered the unofficial epicenter of China’s tech sector. Tencent, a long-standing rival, is also experiencing a moment of triumph, particularly in the emerging field of eSports.
Tencent-affiliated titles have dominated the eSports category, which has garnered significant fan support. The inclusion of eSports as a medal event at the Games follows a protracted official effort, albeit in the opposite direction—against video gaming—within the broader context of the tech crackdown.
Tencent, the global leader in video game revenue, faced an 18-month hiatus from obtaining new video game licenses in China, commencing in mid-2021.
AFP reported that Xin Sun, a senior lecturer specializing in Chinese and East Asian business at King’s College London, pointed out that despite indications of a more lenient official stance, technology companies continue to operate under strict control.
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“From the perspective of the government, contributions from the big techs are still desirable for such a mega project like the Asian Games,” Sun said.
“Because of not only the financial resources they provided but also the various technologies they have brought about to showcase China and Hangzhou’s development achievements. There is little need to give up all these benefits, especially since the tech sector has now been placed under quite restrictive regulatory regime and strong political control,” he added.
He noted that even as China celebrated its tech achievements in Hangzhou, its cyberspace regulator was tightening its grip on Games-related online activity, issuing a directive last month against “spreading false information” about the event.
(With inputs from AFP)
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