According to news from the Wall Street Journal on the 6th, the White House launched a proposal that day that plans to require Chinese companies listed in the United States to comply with US audit requirements, otherwise these companies will be forced to delist. Most of the Chinese concept stocks involved are Internet companies, including Alibaba, JD.com, Pinduoduo and Baidu.
On the same day, the President of the United States signed two executive orders, announcing that it would prohibit any American individual or entity from conducting any transactions with TikTok (TikTok overseas) and WeChat (WeChat) after 45 days, and stipulated that they would be prohibited from operating in the United States after 45 days. .
On August 5, local time, US Secretary of State Pompeo reiterated the so-called “clean 5G network plan” of the United States. Pompeo claimed that he is stepping up efforts to remove “untrusted” Chinese apps from US digital networks. Among them, naming companies such as Alibaba, Baidu, Tencent, and Huawei threaten US information security.
In the past two years, the US government has been lobbying European countries and other allies to “encircle and suppress” Huawei. In recent months, Chinese apps led by TikTok have also been targeted.
Reuters said that Pompeo’s speech on the 5th reflected that the US government is intensifying its efforts to take broader and faster actions to restrict Chinese technology companies from entering the US market .
It seems that the American dream of China’s Internet is also completely broken, and the process is irreversible.
On the evening of August 7th, Tencent issued an announcement stating, “We noticed that the President of the United States of America issued an executive order (executive order) on August 6, 2020, prohibiting applications related to our WeChat application and subject to US restrictions. Certain transactions under the jurisdiction. The company is reviewing the potential consequences of the administrative order to more fully understand its impact on the group. The company will issue further announcements in due course.”
On August 8, National Public Radio (NPR) quoted people familiar with the matter as saying that TikTok will file a federal lawsuit against the Trump administration on Tuesday as soon as possible. The person said that the lawsuit will be submitted to the U.S. District Court for the Southern District of California, because TikTok’s U.S. business headquarters is there.
In addition, NPR was informed that the lawsuit would consider the executive order signed by President Trump to be unconstitutional because it did not give the company a chance to respond. According to sources, TikTok also believes that the “national security reasons” cited by the Trump administration in this executive order are unfounded.
Earlier, US President Trump stated that Chinese Internet company Bytedance must sell TikTok’s US business to Microsoft or other US companies before September 15, or it will be blocked in the United States. He said, “(TikTok) is a very successful company, popular in the United States, and people are fascinated by it. But we cannot afford the security risks brought by these companies, including Huawei.”
He even stated directly at the press conference that there would be no such deal without the US government, so the US government must extract a large amount of money from it.
ByteDance said in a subsequent statement that it has been sincerely seeking to communicate with the U.S. government for the past year, providing constructive solutions to their concerns, and even saying that it can sell its U.S. business to a U.S. company. the company. However, what the US government is facing is that it ignores the facts, does not follow the due process of law to decide the terms of the agreement without authorization, and even tries to interfere in the negotiation between private companies. In the statement, Bytedance said that if the US government cannot treat us fairly, we will resort to the US courts.
Chinese Foreign Ministry spokesperson Wang Wenbin also responded to this series of incidents. He said that Pompeo and other American politicians have repeatedly used national security as an excuse to abuse national power to suppress and contain Chinese high-tech enterprises. China firmly opposes this. The relevant US actions have no factual basis at all. They are completely malicious smear and political manipulation. The essence is to maintain its own high-tech monopoly position, completely contrary to market principles and international economic and trade principles, and seriously threatening the security of the global industrial chain supply chain. It is typical Bullying. “I want to emphasize that many Chinese companies that are currently unilaterally sanctioned by the United States are innocent, and their technologies and products are also safe. There has never been a network similar to the’Snowden Incident’ and’WikiLeaks’. Security incidents, and there has not been a network monitoring behavior similar to the “Prism Gate” equation organization “Echelon System”.”
Going to the U.S. was once China’s Internet dream
In 1992, “Brilliance Auto” was listed on the New York Stock Exchange.
This is the first mainland Chinese company to be listed on the U.S. stock market. Brilliance Auto issued 5 million common shares at an IPO price of US$16 per share. It raised funds of US$80 million, deducting investment bank underwriting fees, lawyers, and accountant fees. Get 72 million US dollars. Brilliance Auto has brought the Chinese people the beginning of making the US stocks rich.
Just after Brilliance Automobile went public in 1994, Yang Zhiyuan and David Filo founded Yahoo, the originator of the portal; Bill Gates, who founded Microsoft, became the world’s richest man. Windows developed by Microsoft was the first-generation operating system; in 1995, it developed Netscape, the first browser “Mosaic”, successfully IPO and achieved great success.
The Internet wave started in the United States.
This wave originated in the United States and will change the lives of everyone in the world in the decades to come.
At that time, Zhang Chaoyang, who had just studied for a Ph.D. in Physics at MIT,’s supervisor was the vice president of the school. He required his graduate students and doctoral students to be proficient in computers. This made Zhang Chaoyang’s greatest gain in working in the laboratory the use of computers. ability. Later, he found that physics was not suitable for him, so he got the role of China liaison officer in the Asia-Pacific region at MIT, and got frequent opportunities to return to China.
While seeing the “Silicon Valley” entrepreneurial passion that can be seen everywhere in the United States, he also saw the rise of China, so he decided to return to his country to start a business, use the Internet to collect and publish China’s economic information, for Chinese people in the United States or interested in China People serving.
In early January 1997, the ITC website was officially opened; in February 1998, Zhang Chaoyang officially launched the first all-Chinese online search engine-Sohu (S0HU).
It’s worth mentioning that because one of Zhang Chaoyang’s shareholders, Negroponte, invested in another American Internet website “Hot Link”, it was “Hot Link” who originally invented the business model of online advertising. Zhang Chaoyang brought great inspiration. At the same time, Yang Zhiyuan’s Yahoo became popular in the United States, Zhang Chaoyang began to learn from Yahoo’s classification and navigation model, and his project eventually changed from the once used “Souhu” to the later “Sohu”.
In order to raise Sohu’s financing, under the recommendation of Robert and Negroponte, Zhang Chaoyang went to California to meet the billionaires at his own expense. In April 1998, Sohu’s second investors included Intel Corporation, Dow Jones, Morningside Corporation, IDG, etc., totaling more than 2.2 million US dollars.
In Zhang Chaoyang’s view, the act of financing overseas at that time gave China’s Internet industry an enlightenment.
The fact is the same. Zhang Chaoyang gave the development model of the early generation of Internet people: to move American technology and models to China, it is best to use American money to develop him.
In 1995 when Zhang Chaoyang had just returned to China to start a business, a college English teacher was hired as a translator to the United States to collect accounts by a Chinese company that cooperated with American businessmen to contract construction projects because of his foreign language skills. In Seattle, this teacher went to a humble company, first came into contact with the Internet, entered the word “beer” on a search engine, and only found American and German brands. Since then, the English teacher is determined to use the Internet to help Chinese companies.
The English teacher is Jack Ma. The Alibaba he founded has changed the way hundreds of millions of people shop. Many years later, he recalled his journey to the Internet. It all started with the word entered in Seattle: “From Bill in Seattle, I first heard of the three words on the Internet; it was also Seattle, the first time I saw the Internet.”
Li Yanhong’s story also began in the United States, but earlier.
At that time, in addition to the Internet wave, there was also a wave of going abroad for further study in the United States. Robin Li also went to the United States to study and work after graduating from Peking University.
During his postgraduate studies in the United States, his tutor’s words aroused great interest from Robin Li: “Search engine technology is a basic function of the Internet and should have a future.” At this time, the Internet has not yet begun to spread in the United States, but Robin Li has begun to study information retrieval technology and is determined to engage in the search industry.
In 1997, Robin Li traveled from Wall Street to Infoseek, a famous search engine company in Silicon Valley. He wrote a book the following year. When describing the war between Microsoft and Netscape, he used this sentence as a starting point: “Silicon Valley is sunny, and Seattle is rainy.”
Soon after Robin Li and Jack Ma accepted their business enlightenment in the United States, China.com became the first domestic Internet company to land on US stocks. The U.S. stock market’s pursuit of the Chinese word has inspired domestic entrepreneurs. In February 2000, the market value of China.com once exceeded US$220, and the market value once exceeded US$5 billion.
Although with the burst of the Internet bubble, China.com’s stock price plummeted and entered a long period of decline. But the China Online Market opened the door for Chinese Internet companies to Nasdaq.
Subsequently, the three major portals of Sina, Netease, and Sohu that are still active today went to U.S. stocks one after another in the millennium. Since then, the three major portals of “Langhuyi” have formed. They are the first generation of Internet traffic portals and opened up the domestic Internet entrepreneurship boom. , Also started the upsurge of Chinese Internet to the United States.
Seeing the mature Internet environment in China, Robin Li chose to return to China. Five years later, Baidu successfully landed on Nasdaq in the United States and created the American myth of Chinese concept stocks. The stock price rose by 354% on the first day, making it the single largest Nasdaq stock increase since 2000.
When Jack Ma founded Taobao in 2003, the US e-commerce platform eBay already had a very mature model to learn from. At the same time, Silicon Valley entrepreneurs have a dream, hard work, and pursuit of success behavior that has influenced Jack Ma for decades. He is always inspired by the Silicon Valley dream ten years ago and believes that everyone can become Google.
At midnight on September 19, 2014, Alibaba went public on the New York Stock Exchange. On the first day of listing, the market value rose by 38% to USD 231.4 billion. Today, Jack Ma has also become the entrepreneurial godfather of a new generation of Internet people in China.
Why go to America? Zhang Chaoyang once said: “The capital market in the United States is so developed, so we have to cross the Pacific to go public in the United States. The listing is generally good, because there are funds, and at the same time, the management has a particularly clear goal: to pay every quarter. The transcript is a very good motivation for forming a company culture. So we want to make a profit all day and form a very good culture. Of course, it can be said that listing is a sign of maturity, and others may believe it.”
The U.S. stock market is the world’s largest and most circulated market, a market with huge capacity, and it has almost unlimited wealth creation capabilities. Corresponding to this is the more advanced management system of the US stock market. In 2006, when New Oriental was listed on the US stock market, Yu Minhong once stated that he hoped to use the strict management rules of US listed companies to regulate the company’s interior, and use the system to speak in order to avoid the entanglement of favors and interests.
Public data shows that since this year, as of July 30, the number of Chinese companies’ IPOs on the New York Stock Exchange and Nasdaq reached 29, compared with only 9 in the same period last year. Listed companies have raised USD 4.5 billion in funds, an increase of nearly 90% over the same period last year. In addition, 6 Chinese companies have raised a total of US$630 million by transferring from OTC to Nasdaq. The other four Chinese companies merged through SPAC companies were listed on the Nasdaq, of which three did not raise funds at the same time as the merger, and the other completed the merger and raised US$32 million through private equity.
Learning from the more advanced technologies and models of the United States, starting with Zhang Chaoyang, it has been a path that Chinese Internet people cannot ignore. From search engines to dating software to the sharing economy represented by Uber in the past few years, the American innovation model was once the pioneer of China’s Internet. . The frequent benchmarking of American products has also caused some domestic entrepreneurs to be criticized for a period of time.
Wang Xing is a very famous one. He was the first young man in the local area to have access to computers. He was sent to Tsinghua University, and then went to the United States to study for a Ph.D. In 2003, Wang Xing valued the development of American social networks, so he dropped out of school and returned to China. The folk house started to start a business.
After failing to start his own business, he noticed Facebook in 2005 and imitated it and established the school network. At that time, the school network even directly copied Facebook’s UI interface; in 2007, Wang Xing noticed Twitter again, and he imitated it again and founded Fan No, but Fanfou was closed due to policy reasons.
Wang Xing, who needed to find a way out, noticed an American company, a group-buying website called Groupon, so the first group-buying website in mainland China, Meituan, was officially launched in 2010. Due to the low threshold of the groupon model and clear profitability, a month after Meituan went online, hundreds of similar group buying websites appeared in mainland China. Later, the Internet spectacle “Thousand Regiments War” appeared.
360 Chairman Zhou Hongyi once criticized Wang Xing without naming names, saying that the so-called famous domestic entrepreneurs are good at plagiarizing American projects, and he copied one if the United States came out. Chinese entrepreneurs should think more about integrating China’s reality, instead of looking at the United States every day, and encouraging Chinese Internet companies to innovate.
Wang Xing’s criticism of the outside world is very light. He once rebutted: “The word innovation itself is not a Chinese concept.”
After all, at that time, not only the Internet center was in the United States, but the capital was also in the United States. It was very important to be able to do China’s Facebook and China’s Twitter for projects in the United States when acquiring American investors. Until the advent of mass entrepreneurship and innovation, the technology industry has laid a solid foundation through years of development. More importantly, the focus of capital has begun to change, and China has begun to have more money in the technology industry.
The independent innovation path of China Internet
The change from reference to transcendence is quietly beginning.
Twenty years ago, China’s three major portal sites Sina, Sohu, and NetEase basically copied Yahoo. Facebook was born in 2004, followed by hundreds of social networking sites in China in 2005 and 2006. Therefore, there is a historical origin for Chinese startups to copy the American model.
However, when China Internet is based on the local market, it has also carried out a lot of founding.
Taobao, which has learned the existing experience of eBay and PayPal, and Alipay, have created a greater Internet miracle in China than eBay and PayPal-mobile payment. From the perspective of banks and Alipay, fast payment balances risk and convenience, and the number of banks cooperating with Alipay quickly reached hundreds. Compared with PayPal, Alipay, which has a fast payment function, completely surpassed the original American prototype and became an unshakable Internet financial account. In the Spring Festival of 2014, WeChat Pay promoted mobile payment to unprecedented popularity through red envelopes. Today, even the most end-of-the-end payment scene of the auntie on the street is using mobile payment.
According to statistics, on a global scale, 86% of China’s population uses mobile payments, with an improvement rate far ahead, followed by Thailand with an improvement rate of 67%. Thailand, which ranks second, lags China by approximately 20 percentage points in terms of progress rate.
China’s takeaway O2O platform originated in the United States, and it has also stepped out of innovation: it is the first to explore a two-wheel-drive development model of “takeaway business” + “logistics and distribution”, so that many small and medium-sized merchants without delivery capabilities have the opportunity to expand their takeaway business. Meituan Waimai has established its own delivery team to provide support for the delivery of a large number of orders. Based on its own delivery system, it is equivalent to having an ecosystem that can serve consumers’ living circle of 3 kilometers, and food delivery is only the first step. . This successful model has also been followed by platforms such as Doordash and UberEats in the United States.
Everything has begun to change. Chinese Internet companies have begun to surpass the United States. As the Associated Press said, “Chinese innovative companies are bringing vitality to the United States, and many American companies are enjoying such a “beauty experience”.”
Pinduoduo, which is rooted in China’s special national conditions, has risen in recent years. Huang Zheng met dozens of investors during the B round of financing. The investors asked him the first sentence: Does your model have a benchmark in the United States? Huang Zheng said it is the first in the world. Therefore, investors did not invest and financing was frustrated. Nowadays, Pinduoduo has become a new model of Chinese e-commerce. Huang Zheng also told the media person Li Zhigang: At that time, not only did more than 400 companies imitating Pinduoduo appear in China, but also a copycat Pinduoduo company appeared in the United States. Imitated China.
Huawei, once targeted overseas, also represents China’s progress. As of April 2019, Huawei has 1,554 patents, ahead of companies such as Nokia (1427) and Samsung (1316), and is the company with the largest number of 5G standard essential patents. Regarding Huawei’s leading position, the “Wall Street Journal” once commented, “Huawei’s influence in the 5G field is not the same as the influence of Chinese companies in the previous generations of wireless networks.”
TikToK, which is now targeted, is the first Chinese company that has almost occupied the United States. TikTok is one of the most internationalized Chinese companies. It has been downloaded more than 175 million times in the United States and 2 billion times worldwide. . In the past year, TikTok has become one of the most popular apps in the world, demonstrating extremely high revenue capabilities, monetization capabilities, and user stickiness. It has continuously impacted Facebook’s position as the number one global social media supremacy.
From the outside, the new power of the Internet will come from China.
In August of this year, the Hurun Research Institute released the “2020 Hurun Global Unicorn List”, which lists non-listed companies that were established after 2000 and valued at more than US$1 billion. The top ten accounts for 28% of the total value of global unicorn companies. All come from the United States or China. Among them, the Ant Group, which was established in 2014, is valued at more than RMB 1 trillion, making it the world’s most highly valued unicorn. From a city perspective, Beijing has become the global unicorn capital, with 93 companies, far exceeding the 68 in San Francisco, followed by Shanghai and New York.
Today, China has become the world’s largest Internet market and the birthplace of many Internet innovations. If Huawei represents the leader in technology, Jin Canrong, a professor at the School of International Relations of Renmin University of China who has been studying the United States since 1984, said that TikTok represents another leader—the leader in business models.
Knowing that “overseas markets are not one market, but multiple decentralized markets,” TikTok has adopted a highly localized “localized operation” in each market, ranging from personalized recommendations to inviting stars such as Justin Bieber to settle in. When it comes to incubating local Internet celebrities, big moves are frequently used, and foreign users are too much to be circled.
Therefore, this became the reason why TikTok was targeted. People always have inexplicable fears about things that they don’t understand but are better than themselves.
Interestingly, when TikTok was targeted, other short video applications in the US market gained a lot of growth. Among them, the fastest growing short video is called Likee. Its developer is BIGO, and BIGO is from China Another established Internet company-Huanju Group.
Once China was led by the American model, now the United States is feeling the power of Chinese innovation.
Many years ago, when Jack Ma was interviewed by a foreign media, he was asked a very sharp question: What if China surpassed the United States? For Americans, their economic strength is relatively strong. If any country surpasses them, their first reaction is to strike and suppress.
At that time, Ma Yun’s answer was that the cultural purpose of the West is to compare wins and losers, but our China is about seeking common ground while reserving differences and coexisting in harmony.
It’s a pity that Trump’s thinking is different from Jack Ma. His actions based on his political stance made Facebook CEO Mark Zuckerberg, who has always had great hostility towards TikTok, also said: “I just think this is a very bad precedent. Whatever the solution is, it must be treated with extreme caution and seriousness.”
On May 21 this year, when asked how he views the recent tightening of supervision and review of Chinese listed companies in the United States by the United States, Baidu Chairman Robin Li said, “We are indeed very concerned about the US government’s continuous tightening of China’s stocks. This kind of control of the company, we are constantly discussing what can be done internally. These things of course include, for example, the secondary listing in Hong Kong and other places.”
Li Yanhong said, “I think the fundamental judgment is that if it is a good company, there are actually many options for listing, not limited to the United States. Therefore, we are not so worried that the US government’s suppression of the company’s business will be irreversible. Impact.”
Recently, Zhang Yiming, who is under tremendous pressure, also said that Bytedance has always been committed to becoming a global company. In this process, we are faced with all kinds of complicated and unimaginable difficulties, including the tense international political environment, the collision and conflict of different cultures, and the plagiarism and smear of competitor Facebook. But we still adhere to the vision of globalization and continue to increase investment in markets around the world, including China, to create value for global users.
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