Good morning. Early Wednesday morning, Beijing time, Michael Spavor, one of two Canadian citizens imprisoned in China in evident retaliation for Huawei exec Meng Wanzhou's arrest in Vancouver, was sentenced to 11 years in prison for spying. This does not necessarily mean he will spend the next 11 years in China. It does, however, worsen Ottawa-Beijing relations and calls into further question the safety of Canadian executives in the country.
In this week's Protocol | China: possible lasting changes in misogynistic tech culture, Chinese apps you've never heard of are blowing up in emerging markets, and another Chinese semiconductor fund raises serious cash.
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The Big Story
Chinese tech's #MeToo moment
Protocol | China's Shen Lu has our most important story of the week, about deeply troubling allegations of rape surfacing at Alibaba — and the possibility that the company, and others like it, may finally institute sexual harassment policies that make a dent in the widespread workplace misogyny afflicting Chinese Big Tech.
For good or ill, China's Big Tech firms are cultural leaders, just like their American equivalents.
- Shen Lu reports Alibaba has long been known for its lewd "ice-breaking" orientation events that leave female employees feeling violated. Alibaba's prominence and reputation as a "greasy" company help set the tone for workplaces elsewhere.
- If Alibaba shifts course as promised, it could herald bigger societywide change, particularly in the toxic drinking culture that infuses work events. Famous feminist organizer Lü Pin told Protocol that simply eliminating forced drinking could be a "huge victory" for China's #MeToo movement.
There's a big potential ripple effect here: The dynamics of China's Big Tech workplaces shape the digital platforms they govern, which in turn shape public debate about workplace issues.
- Chinese tech platforms have been letting on-platform misogyny get out of control; anime fan site Bilibili has promoted shows that objectify women, while Weibo has shuttered feminist activist accounts and, as one feminist complained, "treats the incels as if they are the royal family."
- Yet social media is also the place that female accusers who've previously gone unheard can get their stories out. In this case, it started on Alibaba's internal BBS, then quickly caught fire to become the top trending topic on Weibo.
- Companies with stronger DEI policies that elevate and empower women leaders within their walls are more likely to sustain equitable digital platforms outside of them — assuming, that is, that China's government doesn't force them to move backwards in a misguided belief that doing so will raise birth rates.
The laws, or at least the way they are applied, will probably need to change too. That will take longer. "The true milestone will be when employers can be held liable for the acts of their employees, and held liable for failure to prevent and address sexual assault and harassment complaints," Jeffrey Wilson, a labor lawyer at Beijing-based JunHe law firm, wrote on Twitter.
On Protocol | China
- A new(ish) tool for tech regulators: public interest lawsuits. They're similar to a U.S. class action, but can be announced even before a lead plaintiff has been found. Regulators are now bringing the suits to bear in the tech sphere, with Beijing local prosecutors launching one against WeChat for a "youth mode" that authorities say doesn't comply with China's child protection laws. Zeyi Yang has more.
- A Chinese city has become the Silicon Valley of robotics startups. Time was, Dongguan was a smoggy "factory to the world" that belched out cheap products. Now it's a mecca for VCs and founders trying to ride China's next big wave: automation. Zeyi Yang has the story.
A MESSAGE FROM TRELLO
After a year and a half of living and working through a pandemic, it's no surprise that employees are sending out stress signals at record rates. According to a 2021 study by Indeed, 52% of employees today say they feel burnt out. Crisis management is one thing, but how do you permanently lower the temperature so your teams can recover sustainably?
China Goes Global
- Chinese apps you've never heard of are exploding. And not just in China. Last week, App Annie released its Top 10 Chinese Social Apps Download Breakthrough List for Q2. Downloads were mainly from India, Indonesia and the MENA region. The most downloaded social media app, according to the data from Sensor Tower: Kuaishou-backed Snack Video, which raked in 6.2 million installs overseas in June. Three of the top 10 apps in the chart — CuteU, Uplive and MoonChat — are all developed by Asian Innovations, a Beijing-based company. CuteU's downloads in May surpassed Tinder, ranking No. 1 in terms of global downloads of social apps.
- TikTok usurped Facebook's throne. Nikkei Asia reported Monday that a recent survey shows TikTok as the world's most downloaded app in 2020. An App Annie analyst also told Nikkei Asia that TikTok's total screen time in the U.S. and U.K. now surpasses that of YouTube.
- ByteDance: To list or not to list? On Sunday, the Financial Times cited unnamed sources to report that despite recent chaos around Chinese tech companies going public, ByteDance is still aiming for a Hong Kong listing in early 2022. But ByteDance quickly denied the report when asked by state media-backed tabloid Global Times.
- Kuaishou is leaving the U.S. Kuaishou announced last Wednesday that it would shut down Zynn, an app it released in North America last year to compete with the unstoppable TikTok. After the initial promotion period, the app never made a big splash and had fewer than 500,000 downloads in the first half of 2021, Bloomberg reports. (China tech expert Rui Ma told your host last year that Zynn "doesn't make sense for the U.S. market.") That doesn't mean Kuaishou is staying inside Chinese borders. It's spending big to promote two other subsidiary apps: Kwai in Latin America, and the above-mentioned Snack Video in SEA.
- Vivo's all over the map. In a good way. The Chinese smartphone manufacturer will open smart manufacturing centers in Pakistan and Turkey, which are expected to be able to collectively produce 11 million devices annually. The company says the investments in Pakistan and Turkey will amount to $10 and $20 million, respectively. It was a busy week for Vivo, as it also launched its latest smartphone in Kenya and saw rumors emerge that the company is looking to enter the Indian laptop market.
Straight From China's Web
- Chinese chip companies are raising major funding rounds. Tech outlet 36Kr reports that Silicon Integrated (聚芯微电子), a Wuhan-based semiconductor chip design company with OPPO, Xiaomi and Samsung as customers, recently raised several hundred million RMB in a series C funding round. The funds are primarily meant to support the launch and mass production of Silicon Integrated's products, which currently include smart audio semiconductor chips and 3D vision sensors.
- Bilibili is making its own games now. The anime streaming platform released its first batch of self-developed games at its summer launch event, SCMP's Josh Ye reported Monday. Gaming revenues have always been central to Bilibili, but before last week the company had only distributed games developed by other studios. This step forward will help Bilibili compete with the video game giants Tencent and NetEase.
- Ctrip is testing the waters with hybrid working. Even though China quickly contained the spread of COVID-19 last year and most workers have been back in the office, Trip.com Group, a Nasdaq-listed online travel company based in Shanghai, launched a hybrid office trial on Monday, according to 36Kr. Trip.com will explore whether this hybrid working model can be incorporated into a long-term corporate schedule. Hundreds of employees are participating in the pilot program, which will last for six months.
Big Brother Beijing
- Massive ed tech crackdown → massive layoffs. The sudden overhaul of China's ed tech and private tutoring industry in late July has resulted in tens of thousands workers losing their jobs. The 21st Century Business Herald reported last week that Gaotu Techedu will eliminate positions for nearly 10,000 employees, or one-third of its staff. TikTok owner ByteDance has laid off hundreds of employees after it downsized its new online education businesses to comply with new after-school tutoring rules, according to Bloomberg. And those outside China who'd been teaching Chinese children English via VIPKID will lose their teaching gigs too, since Beijing's new rules ban tutoring companies from hiring foreigners outside of China to teach lessons to Chinese students.
- Big Tech has a stolen surveillance video problem. On Monday, China's Cyberspace Administration said it had made progress in regulating the surveillance camera industry. Since May, regulators have been cracking down on a black market through which hacked surveillance videos are sold and posted online for profit. Most Chinese Big Tech companies are involved, either through selling illegal surveillance cameras (Taobao, JD), facilitating stolen video transactions (Baidu, Tencent), or hosting such video footage (QQ, Weibo, Kuaishou), so they all got a warning. So far, 22,000 relevant social media posts have been taken down, 4,000 accounts have been deactivated and 1,600 camera products have been taken off ecommerce platforms, CAC said.
One More Thing
You can now get your coffee fix from…Zhihu?!
Zhihu, the Chinese Q&A platform that went public on NYSE this March amid concerns about its monetization strategy, has been searching for ways to turn its popularity into more revenue. Its latest effort: launching its own brand of drip coffee. It's because a boutique coffee product matches well with the urban white-collar workers who make up the majority of Zhihu's user base, reported Lieyunwang, a Chinese publication. The first 50,000 orders were gone within just 48 hours, and the market response may encourage Zhihu to lean further into ecommerce.