How did the country’s industry get so hot, and where is it going next.

Insights: China's Tech Boom

[MUSIC PLAYING] ALAN MURRAY: If this divide is going to continue, who wins, who loses? BEN HARBURG: I think, in the long term the scoreboard is going to show-- in the short term, China is being hurt by these decisions, by cutting off, for instance, core components to Chinese mobile phone makers, by restricting access to investment in the United States, and a lot of that core IP that was fueling a lot of the development around here as well. But I think, in the long term, the loser's the United States. I think that forcing self-sufficiency for the Chinese by decoupling supply chains, capital markets, talent, ultimately breeds a system internally of self-sufficiency for China. That capital and talent ends up coming home. And ultimately, that is used not only to develop native industries and build dominant global players locally, but it then is used to address emerging technology markets, where I believe the real battleground lies when we look at a scoreboard. ALAN MURRAY: It probably also creates investment opportunities for you, right? BEN HARBURG: Right. So it's been a saturated market on the consumer internet front, mobility fronts, anyway, in China, over the last few years. And so where the investment is going today, and where the capital is flowing today, is in these replacement self-sufficiency industries-- chips, quantum computing, AI for all kinds of different applications, from city planning to financial services to drug discovery. ALAN MURRAY: Paul, one of the questions I wonder about is whether this divide is almost inevitable, given the difference in values in the two countries around things like data privacy, public surveillance, free expression. There are a number of them. Would we have inevitably gotten to a divide? PAUL TRIOLO: Probably, at some level, divide-- I think the big question is how deep the divide goes. I think Ben mentioned the financial markets, the decoupling of supply chains, other things, but I think that something like data and data privacy, that's a really fundamental issue, where, for example, China remains outside of global best practices on data. And so I think that the challenge is going to be that there's still time for China's data governance regime, for example, to come into line with things like the GDPR in Europe, the cross-border privacy rules in Asia. But if something doesn't happen there, that's going to be a problem. And in the trade talks, they were talking about getting to start talking about these issues. So those are not insoluble problems, but they're being driven by perception that China is also misusing some of these technologies, like artificial intelligence, for certain applications, in terms of monitoring minority populations, that kind of thing. So I think there's a narrative that's very much about values, but I think that the real trick will be for China to try to come into some of the global best practices around data. Chinese companies do that. Hi Air, for example, we talked to this morning on the panel. They're GDPR-compliant internally. But China, as a whole, will probably not be judged compliant on data. So the question is how do you bridge some of those-- the gaps in how China is implementing things like data privacy. BEN HARBURG: The American decoupling moment is coming just at the wrong time. The rest of the world has woken up now-- and the emerging markets-- to the fact that Chinese-built, backed, or inspired business models are what going to dominate in those markets, from Indonesia to India to South Africa and Nigeria. And so, as America detracts and pulls away from the Chinese side, it leaves the Chinese standing alone as the only viable alternative for those markets, not just for things like 5G, which has obviously become a little cliche, but also just in terms of where the capital is coming from, where the inspiration is coming from. So when we talk to emerging market entrepreneurs today that once were heavily oversubscribed, and in order to curry favor with them, you had to tell them, I know this guy in Silicon Valley, and, I know this company in New York that I can connect you with, 18 months ago, started a trend where now, it's who do you know in China, and what Chinese business model can you instruct me on? And with that will come a whole slew of other knock-on effects, as Deborah mentioned. A lot of teams we're talking to are now saying, we want to limit the coding that we do in the United States to under that 20% threshold, so that we are not deemed an American business and so that we can keep the core IP outside the US purview. And we're seeing talent that was previously coming out of Intel and Qualcomm and should be sitting in San Diego today, coming back to China and building chip companies locally because of that uncertainty. We talk to researchers in American universities today that report feelings of a Red Scare, where there's the perception that if there is a Chinese-born national working on a US research team, even on something that is not of national security importance, something even critically lifesaving, like cancer drugs, that there might be a withdrawing of funding from federal sources. And so, as a result of that, a lot of that is now coming home and to everyone's detriment. America was always the country that accepted and welcomed global talent. ALAN MURRAY: But, Ben, you say, "to everyone's detriment," but it seems pretty clearly that you think that the bigger loss is going to be on the US side. BEN HARBURG: I mean, at the end of the day, if America is not the hub of innovation, where the world's best minds feel welcome to come and be funded and supported, that's to our detriment. But it doesn't help China in the long term either because really diverse, intercultural teams end up making better outcomes than siloed, individual teams. 

Insights: How a Tech War with China Could Curb U.S. Innovation

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We could miss out on shaping the future of the tech.

How a Tech War with China Could Curb U.S. Innovation

If the U.S. closes the door on China, we could miss out on shaping the future of the tech.

If this divide is going to continue, who wins? Who was? I think in the long term the scoreboard gonna show. In the short term, China is being hurt by these by these decisions by the, uh, by cutting off, for instance, core components to Chinese mobile phone makers by restricting access to investment in the United States and a lot of that core I p. That was fueling a lot of the development around here as well. But I think in the long term, the losers United States, I think that forcing self efficiency for the Chinese by decoupling supply chains, capital markets Talyn ultimately breeds the system internally of self sufficiency. For China, that capital in talent ends up coming home on. Ultimately, that is used not only to develop native industries and build dominant global players locally, but it then is used to address emerging technology markets where I believe the real battleground lies when we look at the scoreboard probably also creates investment opportunities for you, right? Right. It's been a saturated market on the consumer Internet front mobility front anyway, in China over the last few years, and so where the investment is going today, and where the capital is slowing today is in these replacements. Self efficiency industries, chips, quantum computing. Aye, aye. For all kinds of different applications from city Planning. Financial service is to drug discovery. Well, one of the questions I wonder about is whether this divided is almost inevitable, given the difference in values in the two countries around things like data privacy, public surveillance, free expression there there are a number of them does. Would it would we have inevitably gotten to a divide? Probably some level divide. I think that I think the big question is how how deep divide goes. I think, uh, Ben mentioned in financial markets the decoupling of supply chains, other things. But I think that something like data and data privacy, that's a really fundamental issue where, for example, China remains outside of global best practices on data, and so I think the challenge is gonna be there. Still there still time for training data governance regime, for example, T come in tow line with things like the GDP are in Europe, the cross border privacy rules in Asia. But if something doesn't happen there, that's that's gonna be a problem in the trade talks. They were talking about getting to start talking about these issues those air, not insoluble problems, but that they're being driven by perception that China is also misusing some of these technologies, like artificial intelligence for some certain applications in terms of moderate monitoring minority populations. Like I think so. I think there's a narrative that that's very much about values, but I think the real trick will be for China to tryto come into some of the best global, the best practice around data. Chinese companies do that hi air, for example. We talked to this morning on the panel. They their GDP, are compliant internally, but China as a whole will probably not be judged compliance on data. So the question is, how do you bridge some of the gaps in on how China's implementing things like data privacy? The American decoupling moment is company just at the wrong time. The rest of the world has woken up now in the emerging markets to the fact that Chinese built back or inspired business models are what are what going to dominate in those markets from Indonesia to India to South Africa, in Nigeria and so as America kind of do tracks and pulls away from the Chinese side. It leaves the Chinese standing alone as the only viable alternative for the market, not just for things like five G, which is obviously become a little cliche, but also in terms of where the capital is coming from, where the inspiration is coming from. When we talked to emerging market entrepreneurs today that once we're you know, we're heavily oversubscribed and in order to curry favor with them, you had to tell them. I know this guy in Silicon Valley, and I know this company in New York that I can connect you with 18 months ago started a trend where now it's who you know in China. And what Chinese business model can you instruct me on and with that will come a whole slew of other knock on effects of Deborah mentioned. Ah, lot of teams we're talking to are now saying we want to limit the coding that we do in the United States under that 20% threshold so that we're not deemed in American business and so that we can keep the core. I pee outside the U. S. Purview and we're seeing talent that was previously coming out of Intel on Qualcomm and should be sitting in San Diego today coming back to China and building chip companies locally because of that uncertainty, we talk thio researchers in American universities today that report feelings of a red scare where there's the perception that if there is a Chinese born national working on a U. S. Research team, even on something that is not of national security, important something even critically life saving, like cancer drugs, that there might be a withdrawing funding from federal sources. So as a result of that, ah, lot of that is now coming home and to everyone's detriment. America was always the country that he accepted and welcomed global. But you say to everyone's detriment. But it seems pretty clearly you think that the bigger loss is gonna be on the US side. I mean, at the end of the day, if America is not the hub of innovation and where the world's best minds feel welcome to come and be funded and supported that to our detriment. But it doesn't help China and long term, either because really diverse intercultural teams and making better outcomes than siloed individuals

 REP. ANDY BARR: Now, I was very interested in your testimony, Mr. Zuckerberg, when you alluded to the risks of not innovating, and the danger of the US falling behind some other countries or foreign companies who are creating similar platforms. Will you elaborate on the initiatives in those other countries? MARK ZUCKERBERG: As soon as we put out this white paper on Libra, what we saw was in China, especially, they immediately kicked off this public-private partnership with some of their biggest companies in order to raise to try to build a system like this quickly-- a digital renminbi-- that they could use as part of their belt-and-road initiative, their kind of foreign and economic policy to grow influence throughout Asia and in Africa and other areas. And they're planning on launching this in the next few months. REP. ANDY BARR: Well, I would say, I think, AML, BSA issues is important when we're talking about Libra and Calibra. But I think the American competitiveness angle and the competition with China is a national security issue, and the fact that Facebook and the labor association is launching into innovation, I think, is positive for our national security. 

Insights: Mark Zuckerberg Says China Planning to Launch a Digital Renminbi

It Facebook's Libra look better to U.S. lawmakers.

Mark Zuckerberg: China Planning a Digital Renminbi

The news made Facebook's Libra look better to U.S. lawmakers.

I was very interested in your testimony, Mr Zuckerberg, when you alluded to the risks of not innovating and the danger of us the U. S. Falling behind some other countries or foreign companies who are creating similar platforms Will you elaborate on the initiatives in those other countries? As soon as we put out this white paper on Libra, what we saw was in China, especially. They immediately kicked off a public private partnership with some of their biggest companies in orderto race to try toe build a system like this quickly a digital renminbi that they could use this part of their belt and road initiative. They're kind of foreign and economic policy toe grow influence throughout Asia and Africa and other areas. And they're planning on launching this in the next few months. Well, I would say, you know, when I think a m. L. B s a issues, it's important when we're talking about labor in Calabria. But I think the American competitiveness angle and the competition with China is a national security issue, and the fact that that Facebook and the and the Labor Association is launching into innovation, I think is positive for our national security

Insights: This Is Now the World’s Largest Airport

It’s China’s Beijing Daxing International Airport.

This Is Now the World’s Largest Airport

 SPEAKER 1: Why does it matter to find the next billion users? There's tons of stuff to do in New York, ton of stuff to do in Silicon Valley. America is a great place to invest. We spend time going to Seattle, to LA, to different parts of East Coast. In Silicon Valley, San Francisco alone is booming. However, when you look at those statistics, 10 years ago, when Alibaba first launched Tmall, and first launching e-commerce in a more major fashion, they started a Singles Day promotion on November 11. You're all alone-- in Chinese is double 11-- you don't have any date, you're by yourself, you're kind of a loser, so what do you do? You shop to make yourself feel better. So that's how they started that promotion. $8 million sales happened that day. Quickly, 10 years later, it grew by 4,000x to $31 billion. And Alibaba, obviously as a group, is a half trillion dollar company listed in New York. At the same time, in the US, promotions still grew. You look at Cyber Monday and Black Friday, over that 10-year period, the combined sales also grew 4x. But it wasn't the same. If you look at what was happening in China from an internet space standpoint, user only doubled. Yet the world changed because everybody got used to do things online. We look at users growth internet on a worldwide basis. A lot of growth coming from smartphone. And when you look at where the smartphone users are coming from, three places stand out. Over the next three years, from 2018 to 2021, we're expecting 750 million new net adds of smartphone users. And 2/3 of them are in three places-- India, LatAm, mostly in Brazil, and in Southeast Asia, with Indonesia being the biggest market. And many of these users that are coming online are very young. Almost half of them are under 24 years in age. All of us have kids, many of us have kids. And when I see my daughter and my son, one is 7-years-old, one's 11-years-old, and every single thing they see, they automatically want to touch it and move things. They grew up on iPad. They grew up listening to Spotify. They grew up looking at shows on YouTube. They spend more time on YouTube than all the TV time I ever spent in my life. It's amazing how digitally native the users are, and so they are so used to coming and trying new things. 

Insights: Where the Next Billion Internet Users Will Come From

China's mobile users will have some online company.

Where the Next Billion Internet Users Will Come From

Why is a matter for the next 1,000,000,000 users a ton of stuff to do in New York? Stuff Do Silicone body America's a great place to invest. We spend time going to Seattle to L. A to give in parts of East Coast, and everybody alone is filming. However, we look at the statistics 10 years ago when Ali Baba first chemo and first munching e commerce Ingham or major fashion, they started a single stay promotion November 11. You're all alone in Chinese Double 11. You don't have any any date. You're by yourself. What kind of loser? So what do you shop here? Because l feel better. So that's how they start our promotion. $8 million sales happen, Daddy. Quickly. 10 years later, you goodbye 4000 AKs 2 31 billion. And I'm not obviously of the group is 1/2 a trillion dollar company listed in New York the same time in the U. S. Promotion Still group. You look a cyber Monday and Black Friday over that during a period to come by myself, all the group for access, But it wasn't the same. And we look at what was happening in China Internet based on point user only doubled. Yet the world changed because everything I used to do things online, we look at user growth, Internet on a worldwide basis, a lot of growth coming from smartphone. And we look at what a smartphone users air coming from three places send out over the next three years from 2018 to 2021. We're expecting 750 million new Net ass off Smart User's smartphone users and 2/3 of our three places. India. Lot 10 most in Brazil in a visa would only have been the biggest market. And many of these users are coming online. Are very young, almost have home, are below under 24 years in age. All of us have kids. Many of us have kids and we want to see my daughter and my son. One is seven year old ones, 11 year old and everything. Lee. They see the arm I want to touch it and moving the grew up on iPad, the grub listening and two qualify. They grow up looking at shows on YouTube. They have more time YouTube than all of TV time ever spent in my life. It's amazing how digitally native the users are still ears used to trying new things

Insights: Chinese Workers Push Back Against the ‘996’ Work Schedule

Chinese Workers Push Back Against the ‘996’ Work Schedule

[MUSIC PLAYING] SPEAKER 1: Most of you in the room will not know jd.com because very, very few, if any of you, will be customers. So I just wanted to share a few stats for you to get your heads around. Imagine if you were running a business with 300 million annual active customers. 300 million, that's larger than the United States. 515 warehouses, 2017 revenues of $56 billion US, that's 43% year over year growth, and a market capitalization of $56 billion. SPEAKER 2: One thing we know is very important. In China, China is very special, and the market is special, consumer is special, everything is special. So we have to use-- we have to build our system to more satisfy Chinese consumers. I can tell you that Chinese consumers is the most challenging thing, I think. I mean, in China today, if you buy anything from my company which is over about $10, something like that, the delivery fee is free. And you must deliver to him, to them, within 24 hours. So not like in US, you'll have to spend over hundreds of dollars to buy the Amazon Prime, and then you can get the two days fast delivery service. But I can tell you if you're in China, if they offer customers two days delivery, no, it's not fast. It's a disaster. SPEAKER 1: I think you've made it very easy for people to understand how intense the competition is in China. I want to talk about your partners, JD has very interesting partners. Tencent owns 18% of your company, Walmart owns 12% of your company, and you just brought on another major investor, Google, which owns 1% of your company. I want to start with Tencent, how important is Tencent's WeChat service, which has a different name in China. Remind me the name in Chinese. SPEAKER 2: Wei xin. SPEAKER 1: Thank you. SPEAKER 2: You're welcome. SPEAKER 1: How important is that to JD's business? SPEAKER 2: Well, first of all, I think all those partners, we have the same core values of business. It's very important. If you will collaborate with any partners or company who have different core values, it also will be a disaster. First for WeChat, in China we call the Wei xin, it's very important to us because until today, WeChat can bring almost one-fourth of the new customers, plus for every day. Also, we are developing a lot of very interesting-- just a bundle combined our social and e-commerce together. We call it [CHINESE],, I don't know. Shopping circles. SPEAKER 1: Yeah. SPEAKER 2: Yeah, and a lot of very interesting things. SPEAKER 1: And it's so interesting here because we don't have that in the United States. SPEAKER 2: You have Facebook, Instagram, a lot. SPEAKER 1: Yup, but not nearly the level of commerce is happening on those platforms, as is happening on WeChat with JD in China. True? SPEAKER 2: I think if it will come here maybe everything change. We began to invest on drone technology very earlier, it's almost several years ago. Today, actually, is over 500 drones can fly every day. Even the some in Providence, the total flying hours is over 100,000 hours already. SPEAKER 1: Of your company's drones alone? SPEAKER 2: Yes. And four types of drones were mutual already, from 5 kilograms until 50 kilograms. And on June 18 this year, this is my company's birthday. Our first heavy drone has come from the factory, which can fly about 1,000 kilometers, and that can carry almost between 1 ton to 5 tons. So we have given the level drones, and I think we are a little bit earlier and ahead of with any competitors globally. 

Insights: How Chinese E-Commerce Giant JD Stays Competitive

Why next day shipping and drones are part of the strategy.

How Chinese E-Commerce Giant JD Stays Competitive

Founder Richard Liu explains why next day shipping and drones are part of the strategy.

most of you in the room will not know JD dot com because very, very few, if any, of you will be customers. So I just wanted to share a few stats for you to get your heads around. Imagine if you were running a business with 300 million ACT annual active customers. 300 million that's larger than the United States. 515 warehouses, 2017 revenues of $56 billion US. That's 43% year over year growth and a market capitalisation of $56 billion. One thing we know is very important in China. Chinese very special in the market, special consumers specializing in special So uh, way have to use. We have to appeal to our system. Two more steps by China's consumer. I can tell you the Chinese consumers the most, uh, challenging thing. I think I mean, like in China today it will buy anything from my company, which is over about $10 that you were free free on DDE you must deal, but with them missing kind of our so not a librarian you have You have to spend over $100 per visor. I'm on the crime and then you can get it two days. But it was. But I can tell you, you were in China off our customers. Two days Lura. No, not a fact is that I think you've made it very easy for people to understand how intense the competition is in China. I want to talk about your partners. You have J. D has very interesting partners. 10 Cent owns 18% of your company. Walmart, 12% of your company and you just bought on brought on another major investor, Google, which owns 1% of your company. I want to start with 10 cents. How important is is 10 cents? We chat service, which has a different name in China. Remind me the name in Chinese Li Xin. Thank you. How important is that to J. D's business that first of all, I think all those patterns where I will seem cole values. Oh, business is very important. If you know you were cooperative with any partners our company have given the core values is also will be a doctor. Uh oh. We've had in Tenement Correlation wiring 100 class because until today, Richard can bring almost one falls over the new customers. Also, they are developing a lot of worrying shifting Just a bundle combined. The social Andi comin together. We card like I don't know, shopping circles. Yeah, Yeah, on. Uh, yeah, a lot of wearing shoes. And it's it's so interesting here because we don't have that in the United States. You have. You have You got him a lot, but not not Nearly. The level of commerce is happening on those platforms, as is happening on. We chat with JD and China Truth. I think he will trump their Maybe everything will change. May began to invest on drunk technology. Where earlier? Almost several years ago. Today. Actually. Over 500 drunk. I can fly every day. You've given the seven Providence? Uh, totally flying hours. 0 100 1000 hours already of yours or your company's drones alone? Yes. Ah, nah. Fall type of old junk were mutual. Already from five clothes grand until 50 grand. Ah, nah on to 18 this year. This is out my companies. But the birthday our foot Have iTunes Have you come from the factory? You can't fly about daughter Nikola. Media Ana can carry almost between Anton, £5. So we have given level drunk Ana. I think they are due to be the earlier on all head of it with any competitors globally.

Insights: China's Tech Boom

Insights: How a Tech War with China Could Curb U.S. Innovation

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If the U.S. closes the door on China, we could miss out on shaping the future of the tech.

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Insights: How a Tech War with China Could Curb U.S. Innovation

Insights: Mark Zuckerberg Says China Planning to Launch a Digital Renminbi

Insights: This Is Now the World’s Largest Airport

Insights: Where the Next Billion Internet Users Will Come From

Insights: Chinese Workers Push Back Against the ‘996’ Work Schedule

Insights: How Chinese E-Commerce Giant JD Stays Competitive