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Chinese Innovation Favored in the World

2020-02-20 16:35:00 Source:China Today Author:LIU SHAOHUA
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THE China-developed app Tik Tok has emerged as a world beater, becoming the most downloaded app on Apple’s Store for five consecutive quarters as of May 2019. The app that features sharing short personalized fun videos has repeatedly topped the list of downloads in Japan, the U.S., Thailand, Indonesia, India, Germany, France, and Russia.
              

Malaysian Prime Minister Mahathir Mohamad tours Alibaba headquarters with Alibaba’s founder Jack Ma in Hangzhou City, Zhejiang Province, on August 18, 2018. 

Tik Tok, and its applications, is just one manifestation of the growing number of Internet companies in China that have begun to expand overseas.

One World One App

Nowadays it’s common to see people opting for online payments worldwide. App users in Beijing, New Delhi, Seoul, and Manila respectively make purchase payments with Alipay, Paytm, Kakao Pay, and GCash – these are apps with very similar functions. The latter three are called “localized Alipay,” which are modified according to local conditions in different regions. Generally speaking, these apps are bringing lifestyles around the world closer.

Mobile apps from China are driving this process faster.

Since its overseas launch in 2013, the first product developed by Newborn Town (a mobile app developer) has topped the list of personalized application downloads in app stores in 89 countries and regions. Since then, it has continuously improved its products, created more than 40 mobile apps, covering desktop, security, music, information, fitness, games, and other categories, and has accumulated nearly 700 million users from more than 200 countries and regions. Among them, users in developed European countries and the U.S. account for more than 40 percent, with other users located in southeast Asia, India, the Middle East, and North Africa.

According to its founder and CEO Liu Chunhe, the most distinctive feature of its products is the replication of the Chinese model overseas. “Our daily active users have exceeded 35 million, which fully demonstrates the global users’ love for Chinese products,” said Liu.

As Chinese companies move towards the global market, global research and development (R&D) has gradually become an important part of their international development. This will not only help people find better ways to integrate technology and human resources, but also get closer to local markets, providing important technical support for enterprises in various fields to explore global markets.

In the U.K., R&D institutions of Chinese companies are on the rise. More Chinese companies have set up R&D centers in the U.K. and are accelerating their integration into global markets through overseas research. Located in the suburbs of Birmingham, China’s Changan Automobile U.K. R&D Center has gradually developed such capabilities as concept design, engineering development, automobile integration, and simulated analysis after nine years of development. Huawei also set up an institute in London to focus on artificial intelligence (AI) technologies, including computer vision, natural language processing, decision-making, and reasoning. These technologies are not only used to upgrade current products and services, such as mobile phones, but also help enterprises to accumulate long-term technology capabilities.

“In my opinion, far-sighted and powerful Internet companies that go global earlier will be more profitable in the future,” said Qi Zhenhong, head of the China Institute of International Studies.

                                                                

                       Tik Tok has swept the world. 

World Leader

According to the 44th Statistical Report on Internet Development in China released by the China Internet Network Information Center, up to June 2019, the number of netizens in China reached 854 million. Among them, the number of mobile Internet users amounted to 847 million.

Such a huge market has cultivated numerous successful products and models and a large number of practitioners in the past few years, including product designers, technology developers, and marketers. All these have laid a solid foundation for Chinese Internet companies to go abroad.

In terms of the quantity of Internet users, the volume of e-commerce transactions, and the scale of mobile payments, China is already number one in the world. China, with the world’s largest population, has a growing number of middle-income consumers. Added to this, being the second largest economy in the world, the largest country in global trade in goods, and the largest country in manufacturing, all contribute to making China the only country in the world with all the industrial categories listed in the UN’s International Standard Industrial Classification of All Economic Activities.

App scenarios from China have inspired the world’s Internet industry.

In 2018, Facebook launched its short video application, Lasso, in the U.S., which was considered to be a competitor for Tik Tok. In fact, other short video applications from China, such as Kwai and Vigo Video, have achieved good results overseas, especially in Southeast Asia, and become targets for competition.

Short videos have become an emerging industry for Chinese Internet companies going abroad. According to People’s Daily, during the first three quarters of 2019, the proportion referring to China’s short video applications in the global news reports on video applications accounted for 53 percent, and overseas coverage increased by 63.5 percent year-on-year.

In October 2016, Alibaba proposed the City Brain and began implementing the project in Hangzhou, utilizing real-time, full-scale city data resources to globally optimize urban public resources, instantly correct city operation defects, and achieve triple breakthroughs in urban governance models, service models, and industrial development. In Hangzhou’s central urban area traffic, congestion has been greatly reduced along some most congested routes.

After a successful pilot was conducted in China, the model has gone abroad. On January 29, 2018, Alibaba Cloud, the cloud computing arm of Alibaba Group, announced the launch of its Malaysia City Brain initiative in collaboration with Malaysia Digital Economy Corporation, the country’s digital economy development agency, and Dewan Bandaraya Kuala Lumpur, the city council in the capital. In the future, it will be fully applied to Malaysia’s transportation governance, urban planning, and environmental protection. On May 24, 2019, Alibaba Cloud announced in-depth cooperation with a well-known intelligent transportation company in Malaysia to build an intelligent traffic management system in Kuala Lumpur. The system integrates the core technology engine of Alibaba Cloud’s City Brain, which can intelligently transform the traffic management facilities in the city, saving 12 percent of travel time in the local area.

According to Yu Hong, executive director of Granite Global Ventures, the stage of going global means that Chinese entrepreneurs transplant Chinese business models or take advantage of China’s accumulated business advantages to start businesses overseas. In the past, only large companies would consider globalization, now startups are also getting involved.

Experience and Strength

In the Middle East, many popular mobile games are developed by teams from China. These games, developed in accordance with local cultural habits, rank high on app store’s bestseller lists.

Behind the games are the threads of technical construction. Based on Alibaba Cloud’s products and technologies, many production teams have completed configurations and backup services on overseas markets. Before Alibaba Cloud entered the Middle East, many foreign Internet companies had to detour to Europe to complete the server configuration in order to enter the region, as well as dealing with issues such as operation, maintenance, and security.

Over the past few years, China has vigorously promoted the transformation and upgrading of its economic structure and developed the digital economy with fruitful results. Nowadays, its digital economy leads the world. China’s high-speed rail, electric power, mobile operators, and banking have long been leading the world, helping entrepreneurs to hone technology and products and then replicate and promote them globally.

Due to the uneven development of its light industry, Russia needs to import a large number of daily necessities, and young people like to buy products online from China. Many Chinese businesspeople seized the opportunity and sell affordable mobile phone cases to the Russian market. Unexpectedly, when the sales increased, the postage suddenly rose, which made the bulk, low-priced products less or even not profitable. In 2018, Cainiao, an Alibaba-based intelligent logistics platform, and Russian Post reached an agreement and within a month, more than 100,000 small-value parcels were delivered to consumers. With the experience accumulated in China, this cross-border logistics problem was easily solved.

A report by a third-party monitoring agency, App Annie, shows that in the first half of 2019, overseas market user spending on Chinese mobile game publishers increased by 20 percent, while game downloads increased by two percent. Chinese mobile game publishers gained 16 percent of the global share (excluding the Chinese mainland market), ranking third.

With China’s advantages built in innovative technologies such as AI, blockchain, cloud computing, and big data, Chinese tech companies are actively going abroad, especially with Asia as a foothold, to expand into other emerging markets and European and American markets.

Changing People’s Lives Overseas

China’s mobile phone software products are changing the lives of people abroad.

In India, people are accustomed to using a software called ShareIt to transfer files. In Turkey, many young people use a social software called MICO to find partners. In Brazil, PUBG MOBILE is the best-selling mobile game. All these apps were developed in China.

Tik Tok surpassed Facebook, Instagram, Snapchat, and YouTube to become the most downloaded app in the U.S. in October 2018. Meanwhile, videos from Tik Tok are very popular on social platforms such as Twitter and Instagram, with more than one million views. The Apple App Store praised Tik Tok as the world’s largest short video platform and one of the authoritative applications for global youth culture.

This app from China has deeply influenced people’s lives in other countries. In India, Tik Tok launched an online challenge during the traditional Indian Holi Festival in 2019. Users created a variety of interesting videos under four different tags, and this challenge quickly received over 1.5 billion views. In Germany, the famous electronic music band Scooter used Tik Tok to promote new singles. In France, many local media opened official accounts in Tik Tok to connect with the youth by offering them scientific knowledge. In the U.K., Tik Tok also created an online sensation.

After debuting Solo Launcher, the core product of Newborn Town, with functions backed by AI technology, it has become a must-have app for countless users and highly praised by the industry. Newborn Town has also successfully entered the global mobile Internet market.

Checking the download list of app stores in these countries, you will find that the top apps are usually made in China. In some countries’ Top 10 list, the number of Chinese products is even more than half.

In the ASEAN region, where the Belt and Road countries are concentrated, a considerable number of people do not have any access to formal financial services. After entering these countries, inclusive financial practices by Ant Financial is promoting the local leapfrog development of Internet finance to help local people improve their lives.

In the field of Internet technology, the spillover effect from big powers is growing.

As of November 2019, Alibaba Cloud has served millions of users in 19 areas, such as Singapore, India, Malaysia, Indonesia, India, Japan, Australia, the EU, the Middle East, and the U.S.

Starting in February 2015, along the Silk Road Economic Belt, Alipay and local partners have successively launched services in nine countries and regions, namely South Korea, Hong Kong, the Philippines, Thailand, Malaysia, Indonesia, Bangladesh, India, and Pakistan, serving more than one billion users worldwide.

“From China” is fast becoming a label that people all over the world are familiar with and trust.  

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LIU SHAOHUA is a reporter at People’s Daily’s overseas edition.

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