After being the subject of monopoly investigations, which led to the hardening of his trade action outlook, the large Chinese trading platform Alibaba received new warnings from the authorities in its country.
China asked the company founded by Jack Ma to withdraw its investments from the media sector, because of the company’s growing public influence and the way in which this may affect the landscape, according to a report by The Wall Street Journal.
Jack Ma remains under the scrutiny of the Chinese authorities
The monopoly accusations that shook Alibaba at the end of last year, led to the departure of its founder, tycoon Jack Ma, from the company’s board of directors. Despite that, it remains an important shareholder of the company and continues to be observed by the authorities, due to all its history.
The relationship between power and the media is close and in this case, the Chinese authorities paid special attention to the participation of this large Chinese company and the local media spectrum.
In recent years, the Alibaba group of companies added to its list of members a series of communication media, covering the most diverse areas, such as the written press, radio broadcasting, digital platforms, social networks and advertising.
Within this group you can find important participations in companies such as Weibo, a social network of microblogging very popular in China; Bilibili, a video platform with growing popularity among Chinese youth, and the South China Morning Post, a leading English-language newspaper in Hong Kong, among other mass media channels.
Although the total value of Alibaba’s assets in the communication sector is not mentioned precisely in the Wall Street Journal report, the article estimates a value of 8 billion dollars for the group of companies, according to figures calculated with the stock market data on the date of publication of the report. The consortium’s largest holdings are in Weibo Corp. ($ 3.5 million) and Bilibili Inc. ($ 2.6 million).
In addition to these direct investments, the Chinese business conglomerate has also established other types of business partnerships with the Xinhua news agency and some local government-run newspapers in Zhejiang and Sichuan provinces.
Alibaba is not the only company with interests committed to the media
The situation reported on Alibaba is not an isolated case. Other large Chinese tech companies have also dabbled in the media. For example, the WeChat messaging platform, owned by Tencent, is one of the main news subscription channels used by the general Chinese public. Also, Bytedance Ltd., the parent company of TikTok, controls the popular news aggregator Jinri Toutiao, which through the use of artificial intelligence recommends news to hundreds of millions of users in the Asian giant.
Clearly, Jack Ma’s recent track record hastened the issuance of this warning about his companies. However, the report does not indicate if the call for attention applies only to this particular case, or if the rest of the companies will also face a similar fate in the future.
In any case, this call for attention from the Chinese government was imprecise, according to what was accused in the aforementioned report. It was not specified whether Alibaba should completely move away from the media or just reduce its share of investment in them.