China moves from “mobile first” into “data first” – Winston Ma

 

Winston Wenyan Ma

China was the first economy to leapfrog into mobile, skipping hardware technologies from the West. Now it is moving from “mobile first” into “data first”, paving the digital road also for other economies, writes investment analyst Winston Wenyan Ma in Arabian Business.

Winston Wenyan Ma:

Across just about every industry sector, Chinese companies are rushing to learn how new digital technologies, including the internet of things, AI, blockchain, cloud computing and data analytics can be integrated into their businesses to unlock value from non-traditional angles. The transformation of businesses and industries has been more profound than from the mere addition of internet.

Again, taking the logistics issue Singles Day for example. The inventory, distribution and delivery of numerous orders in a short span of time is such a challenge.

And as such, Alibaba’s logistics affiliate, Cainiao, launched big data analytics to empower merchants with demand forecast data and allow them to accurately pre-stock their goods in the right quantity and location.

Moreover, Cainiao used GIS (Geographic Information System) to determine the fastest and most cost-effective delivery routes in a variety of complex road networks, including both rural villages and crowded urban areas. Because of the 2020 coronavirus pandemic, Cainiao deployed more than 10,000 mobile lockers to allow customers to pick-up parcels without human contact.

All these have profound implications for emerging markets that are looking at China as a reference case when they work on their own digital transformation. That means they need to look beyond mobile phones and the digital wallet; instead, they must start positioning themselves for the next phase – AI and the digital economy – now.

The billion-user messaging service of WeChat, $74 billion e-commerce in 24 hours on Singles Day, and “smile-to-pay” functions creating a cashless society are already screenshots from yesterday.

More in Arabian Business.

Winston Wenyan Ma is a speaker at the China Speakers Bureau. Do you need him at your (online) meeting or conference? Do get in touch or fill in our speakers’ request form.

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Alibaba is not in real trouble with US stock regulator - Paul Gillis

Paul Gillis

Alibaba´s shares fell when it disclosed the US stock regulator has asked some questions about its accounting practices, especially the relations with its logistical partner Cainiao Network. But, says accounting professor Paul Gillis to Bloomberg, there is no reason to expect real problems.

Bloomberg:

Alibaba fell 6.8 percent to $75.59 in U.S. trading, the biggest drop since January. It was down less than 1 percent this year through Tuesday. The stock fell 22 percent last year, hurt by a slowdown in China’s economy, where it accounts for more than three-quarters of the nation’s online retail sales. 

The probe appears to be aimed at improving transparency for key parts of the business, said Paul Gillis, an accounting professor at Peking University’s Guanghua School of Management. 

“We don’t have enough details to know how serious this is at this point,” said Gillis. 

Alibaba owns a 47 percent stake in Cainiao, which counts Temasek Holdings Pte, GIC Pte and Khazanah Nasional Bhd as investors. The company doesn’t directly own physical infrastructure including property, trucks or delivery personnel. Instead it provides a centralized information system to support courier companies. 

Because of its ownership level, Alibaba reports only its percentage of the losses at Cainiao. The U.S. regulator may be asking whether Cainiao should be consolidated completely, according to Gillis. While that would mean that Alibaba would have to include 100 percent of the losses from the business, it wouldn’t be a big deal, he said. 

“That wouldn’t have a huge affect on the financial statements,” Gillis said.

More in Bloomberg.

Are you interested in the technical background of the comments by Paul Gillis? Check out his weblog here.

Paul Gillis is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers´request form.

Are you looking for more experts on managing your China risk at the China Speakers Bureau? Do check out this list.

Earlier this year we discussed with William Bao Bean how competitor Tencent is organizing its company.
 

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