Low-hanging fruits are gone for China’s tech firms – Matthew Brennan

 

Matthew Brennan

Growing and making profits on the internet has been relatively easy for China’s tech firms when the industry took off, says veteran Internet watcher Matthew Brennan to the state-owned CGTN. But those easy gains are over now the government stepped in to regulate the industry and massive growth is harder to get, he adds.

CGTN:

In mid-2016, word started to go around that the Chinese internet had started to enter the “second half of the game.” The number of internet users in China exceeded 1 billion by June this year, making it the country with the largest internet user base in the world. But the rate of growth is slowing, from a 20-percent year-on-year growth rate before 2011 to single-digit growth in recent years.

“The bonus period of consumer internet is now fully over,” said Matthew Brennan, a China-based technology analyst. “The lower-hanging fruits are gone, and the growth opportunities are either going international or going into lower-tier cities.”…

“Before, it was very wild in terms of how those companies operated,” said Brennan. “Now it’s a matter of restoring orders.”…

Attempts to develop the industrial internet also surfaced, with a series of policies introduced to use technology to transform China’s industrial base. In November 2017, China’s State Council issued a guideline on deepening the “internet plus” advanced manufacturing to develop the industrial internet.

Given that China is moving up the value chain, there is a strong emphasis on manufacturing from the government’s perspective, said Brennan. “China has a considerable advantage in manufacturing, having been the world factory for many decades now. Keeping that advantage makes a lot of sense.”

More at CGTN.

Matthew Brennan 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.

Are you looking for more experts on China’s digital transformation at the China Speakers Bureau? Do check out this list.

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New trends for IT startups – William Bao Bean

 

William Bao Bean

Seasoned Shanghai-based VC William Bao Bean, general partner at SOSV and managing director of Chinaccelerator and MOX, sits down with Asian Pioneers to discuss his background, upbringing, and early career. In this snippet: what are the new trends in his industry, biotech and AI?

Asian Pioneers:

AP: SOSV invests in many verticals through its accelerators so there must be a lot of insights. Where do you see the next big trends? Are VCs transitioning to biotech or deep-tech?

WBB: Bio is deep-tech, hardware is deeptech, internet software is deep-tech. Deep-tech is leveraging cutting edge technology to drive a change. Technology can also be in a vat. Most of the cellular agriculture looks like brewing beer. You put culture and microbes in, you take something that’s like goo and turn it into something that changes the world. That’s what my partners are doing at IndieBio, our biotech platform. It’s extremely technical and I don’t understand most of it. One area where I’m very focused on is artificial intelligence.
Almost every one of our companies is leveraging AI. They leverage data and algorithms to solve problems, improve services, personalize marketing and increase efficiency. Startups can do things now that 3-4 years ago would have required an army of people and months of time.
How much does a candy bar phone cost right now? $5 USD. Android phones are like $50 USD. We’ve recently invested in a company that refurbishes Android phones. They’re selling them for $25 USD with a warranty and a certificate, bringing the cost down and the entry barrier down. We are also investing in blockchain to improve security, transparency and trust in areas like agriculture through our portfolio companies Scantrust and UNL. Coffee Exchange is helping the 20 million coffee farmers out there to make more money and enabling coffee drinkers to know who grew the beans.
I think the next biggest trend is the next 4 billion people who don’t have the internet. That’s our tagline for the last five years at MOX. The amazing thing about the next 4 billion is that they’re now the next 3 billion people. Since we started MOX, almost 1 billion new people have connected to the internet and are using it regularly. That’s going to be one of the biggest revolutions — bringing technology, services, information and education to people who didn’t have it before.
People think it’s strange when Google focuses on people who make about $1000-$1500 USD a month. When we first started, we focused on people who were making $250-$500 USD a month. Now, we focus on people who earn about $150 a month. Those are very different economic strategies. We’re helping people lease their own smartphones, change their lives through services like microloans even though their total monthly wage is only about $125-$150 USD. Is it going to get us superrich? Probably not. A lot of it is cliche but we are in a very lucky position to be improving lives day-to-day.

More at Asian Pioneers.

William Bao Bean 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 innovation experts on the China Speakers Bureau? Do check out this list.