Tech titans wealth grows as China adopts digital life
BEIJING — Jack Ma, the charismatic head of Alibaba, and Ma Huateng, CEO of Tencent, are locked in a tense race to become the richest person in China and Asia. With market values of more than $300 billion each, Alibaba and Tencent are now China’s biggest companies, a stark contrast to just five years ago when no tech company even made the top 10.
Anyone seeking to decode the secrets behind the rise of the two stellar companies could do worse than just look around any Beijing subway carriage. Almost every passenger, young or old, white collar or construction worker, is very likely to have their eyes fixed on a smartphone screen.
And they are not just playing Tencent’s popular game Honor of Kings, or chatting with friends. They order groceries, transfer money, watch movies, read books, book holidays, or even manage their stock market portfolios.
As in many other areas of the economy, the scale and speed of the change in China’s digital sector, the mobile internet in particular, is staggering.
Over 750 million Chinese, more than half the population, are now online, 96 percent of them via smartphone, according to the China Internet Network Information Center.
Mobile data traffic hit 9.4 billion gigabytes in 2016, more than 10 times the amount in 2012. Data traffic by mobile phone in the first half of this year was 8.9 billion gigabytes, more than double the same period last year.
This is perhaps the most dynamic mobile ecosystem in the world, and the epitome of “Chinese characteristics”.
The aggregate value of China’s digital economy rose to 22.6 trillion yuan ($3.4 trillion) in 2016 from 18.6 trillion yuan the previous year. That’s over 30 percent of the nation’s GDP, according the China Academy of Information and Communications Technology.
This change to GDP structure exemplifies how far China’s economy has come. Innovation and entrepreneurship are at the center of a new cosmos. It is easier than ever to set up a business, not just in terms of administrative procedures and government approval, but through a plethora of novel financing vehicles for startups.
Behind policy documents and bold statements lies a world-class information infrastructure. Since 2015, internet speeds have risen relentlessly and data charges have fallen in tandem. There are now 888 million 4G users in China.
In January, a 100 billion yuan fund was established to support the internet sector and it was announced that 1.2 trillion yuan would be spent by 2018 on information infrastructure.
While companies that invest heavily in research and talent are reaping a fine e-harvest, ordinary people are sharing the bounty. Every day, life gets easier, faster and, very often, cheaper.
Ms. Sun from Beijing is a busy woman, but house-proud and concerned by stubborn kitchen stains and ice buildups in her freezer. Now, she has an app on her phone that brings professional cleaners to her door who solve her problems in no time at all. “It saves me time and energy,” she said.
The mobile internet is breeding new professions and new industries with tailored services only a few taps away. The digitalized lifestyle is the real new normal: mobile payments, mobile entertainment, mobile socializing and even mobile “officing”.