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In a torrid year for China’s great technologies, it has been more or less common as for the country’s most valuable technology company and its founder, now China’s second richest man.
Tencent, the $ 7.3 billion social media and gaming giant, and Pony Ma, its 49-year-old executive, have avoided significant public censorship at a time when Alibaba, Ant Group and Meituan have faced serious questions from regulators about their business and their market. power.
Tencent is unlikely to escape unscathed, according to officials who are quietly preparing a case against his music business, but Ma’s low profile and attention to government relations have put the company in a good position for the negotiations.
“Silence will help you make a fortune,” said two Tencent employees, who cited a golden rule for Chinese businessmen popularized by former Communist Party leader Jiang Zemin.
By contrast, his former rival, Jack Ma, has barely been seen in public since regulators stopped the initial $ 37 billion public offering of Ant Group, his fintech company, in past.
“Pony is what the government wants in a technology executive. It’s low-profile and usually goes along with government plans, “said a founder of tech startups.” It’s the opposite of Jack Ma. “
According to two technical officials in Guangdong province, where Tencent is headquartered, the group’s music division is likely to receive a major fine this summer after the Communist Party’s centennial celebrations are over.
Regulators are likely to issue a fine for antitrust abuses to Tencent Music, a music streaming service that owns about two-thirds of China’s online music market and withdrew and traded in the U.S. in 2018, they said. say officials. Tencent declined to comment on the possible fine.
Officials added that Tencent was still negotiating backstage over whether it should relinquish some of its exclusive music rights to the world’s largest record labels or sell music apps.
“Tencent will be penalized. They need to show their loyalty and make a good gesture [for Beijing]. It all depends on Beijing: local authorities do not have enough power to help, ”a Guangdong official said.
But it is not believed that Tencent’s core business, video games and WeChat superapp will not face pressure from regulators, even though WeChat has become such an important messaging and social media platform that it is he calls it “public utility”.
Over the years, Ma has demonstrated a great ability to perceive climate change towards the technology sector.
At this year’s annual Chinese legislative session, Ma, who has been a delegate to the National People’s Congress since 2013, called for stricter regulation of Internet companies, giving high-level support to the current government campaign.
The company handles numerous requests from various branches of government for censorship and surveillance on its messaging platforms.
In January 2020, WeChat censored hundreds of new keyboards related to the Covid governmental management. The information he has provided has led to arrests and punishments, especially of a man who was sentenced to prison for calling President Xi Jinping a “steam monk.”
To increase its surveillance capabilities, Tencent has developed algorithms to better censor images. “The government needs WeChat: they rely on each other,” one employee said.
Tencent has also provided the government with cloud computing services, as part of the drive to develop Chinese “smart cities” and its engineers worked on applications to help Covid-19’s response.
As China’s other tech executives step back from day-to-day management, most notably Zhang Yiming at ByteDance, owner of the TikTok video platform, and Colin Huang at Pinduoduo, the e-commerce group, Ma is celebrating her 23rd year at the helm of Tencent. .
Born into a middle-class family on the southern island of Hainan, he began writing code in college and quickly became a “master of computer virus creation,” according to an authoritative book on Tencent’s history of journalist Wu Xiaobo.
“I’m a typical computer programmer,” Ma told Chinese media. “Even my parents didn’t expect a nerd like me to start a business.”
According to his own account, “he’s not very sociable” or “he’s good with words.” He rarely gives interviews or speeches, makes public appearances, or posts on social media.
But under his leadership, Tencent has multiplied its revenue 24 times over the past decade and has become China’s most active investor, financing 160 emerging companies last year. Only the value of its listed investments was Rmb1.4tn ($ 216 billion) at the end of March, more than a quarter of its market capitalization.
It has acquired stakes in Chinese investments, such as food distribution group Meituan and e-commerce juggernaut Pinduoduo, while buying shares in emerging overseas technology and gaming companies such as Snap, Riot Games and Epic Games.
Tencent also invested in a venture capital group initiated by the son of China’s top financial manager while investing in the group for Tencent Music.
Its prolific negotiation has also put it in conflict with antitrust regulators, who have fined the company several times in recent months for failing to seek approval for past acquisitions. Ma said the company was “actively cooperating with regulatory authorities… Including ordering some of these past investments.”
Elsewhere, Ma pushed Tencent away from overstepping the boundaries of technology and finance. While Jack Ma’s ant group became China’s largest consumer lender, Tencent went from tiptoe. And months before canceling Ant Group’s IPO, Pony Ma resigned as a representative of Tencent’s mobile payment platform, Tenpay.
“The basic principles of finance are stability and health. It’s about who lives longer, not who runs faster in the short term, “Pony Ma said during a 2017 legislative session as regulators looked at financial risk. Ant is now facing a” rectification “campaign aimed at reduce your business while Tencent tests a consumer loan product similar to a credit card.
The company’s biggest public relations challenge to date came four years ago, after parents and state media complained that Tencent’s gaming business was causing children’s addiction, a campaign that sparked that the government would stop new gaming licenses for almost a year.
A day after the publication of the People’s Diary of its first critical opinion on Tencent’s gaming business, the company announced that it would set time limits on children’s use, becoming the first group Chinese who did so, more than two years before a government edict arrived to force the rest of the sector to follow suit.
Since then, Ma had been “extremely focused and detail-oriented” in addressing the issue, and on at least two occasions she emailed the child protection team in the early hours of the morning to give advice and encouragement, said a team member.
Reports from Nian Liu, Yuan Yang, Ryan McMorrow and Sun Yu
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