Behind India'S Ban On Chinese Apps: Giants Are Cautious And Hope For The Next Blue Ocean

"In recent years, Indian counterparts, entrepreneurs and funds often come to us to talk about whether to invest in joint ventures or develop business in India. We all declined. In areas where the legal system is not sound, customs and culture are not familiar with, the government makes arbitrary decisions, the social strata are seriously divided between the rich and the poor, and the economy is underdeveloped, if we want to do business seriously, we must be careful. " The Indian market was particularly hot the year before last and last year, and it only cooled down this year, the head of a large online recruitment company told 21st century economic news.

At the same time, China's Internet in India's "expansion", also had to press the pause button. On July 27, following the decision of the Ministry of electronics and information technology of India to ban 59 applications, including tiktok, microblog, wechat, UC browser, etc., 275 Chinese apps were included in the so-called "list", and more applications of Chinese Internet companies may be banned by the Indian government.

Although the Indian government has not given detailed provisions on the ban, but a series of disturbances have begun to emerge.

Ma Yun and UC India

Recently, Alibaba founder Ma Yun was summoned to hot search by the court for UC India layoffs.

The incident comes after a former UCWEB employee named Pama sued Alibaba, claiming that he was wrongly hired for opposing the content censorship and false news of UC browser and UC news. Therefore, the gurug District Court of India, which accepted the case, summoned Alibaba, Ma Yun and other relevant individuals and operation entities to attend the court in person or through lawyers on July 29.

Ma Shuai, chairman of Alibaba, said on July 26 that it was difficult to find out whether Ma Shuai, chairman of Alibaba, had received a notice on July 26.

The dispute between the employee and the company is just a small microcosm. On July 15, Alibaba's UC browser, UC news and vmate, a short video product, went out to India to inform the local staff that the team was about to be disbanded. At the same time, nearly 90% of more than 350 Indian employees have been laid off. Some assistants, managers and junior staff have been told the news of layoffs through video conferencing.

Alibaba India explained that the dismissal of employees was due to India's ban on UCWEB and vmate, which hindered the company's ability to continue to provide services to India. However, in an interview with the 21st century economic reporter, Alibaba officials still said they would not respond.

Before that, UC and news were the two top products of UC news industry, which had been in the top two categories of news products in India.

However, looking at the global market, the market is not optimistic. UC browser has more than 430 million active users worldwide, of which 130 million are in India, which is the second largest mobile browser in India. As of June 2020, UC browser had 10.19% market share in India, while Google Chrome had more than 75% market share, according to StatCounter, a research firm.

"I think the adjustment of UC in India has something to do with Alibaba's globalization strategy. In the past two years, Alibaba has hardly made any new investment in India, only following investment in past projects. It shows that it has become more cautious about the market. There is a lot of potential in India, but there is still a long way to go before commercial cash flow and returns are made. " In an interview with 21st century economic reporter, Hu Jianlong, founder of zhixiang.com, believed that in a short period of one or two years, the Indian market will be greatly affected, but India is not the core business of the giants. In the future, the pattern of going out to sea will be adjusted or reshuffled, but it will not change the global thinking of Alibaba and Tencent.

Tencent adjustment strategy

Recently, it has been revealed that many wechat users cannot log in again in India. In addition to the Chinese and Chinese registered with Indian mobile phone numbers, there are also Indians who have business with China.

For a local journalist who is still a mainstream social media reporter in India, it doesn't have a big impact on the Indian economy. In contrast, tiktok has been hit more seriously because of its higher market share.

Before the ban, Chinese Internet companies had disclosed detailed investment plans and business strategies in India. Byte hop, the parent company of tiktok and helo, has said it plans to invest up to $1bn in India. According to the data statistics of local institutions in India, as of May 2018, Tencent has invested about $1.3 billion in the local area, involving travel, games, e-commerce, and medical care.

In addition to investment, according to zhixiang.com, wechat has tried to perform in the Indian market. As early as early as 2012, Tencent set up a team of more than ten employees in gurugram, not far from the Indian capital, to launch wechat marketing activities. A former wechat Indian executive, who did not want to be named, told the media that wechat was the first mobile app to launch TV advertising in India.

At the beginning, wechat attracted the public's attention, and ranked first in the download list of Google Apps for 45 consecutive days. However, judging from the data of touch treasure big data in mid July, India's social industry is mainly dominated by Facebook and INS, and has always maintained a leading position. In terms of short video social networking, sharechat, tiktok, roboso, snapchat, helo, etc. are in the forefront.

In the Indian market, Chinese offshore developers are often active in the top 10 list in social networking (especially short video social networking), video, photography, tools, e-commerce, games and other industries, and even occupy half of the list at most.

Different from the earliest pure tool form products going out to sea, now the developers of the sea have hatched a batch of content or pan entertainment products through their experience in China and the successful experience of localization operation, and these products have a closer relationship with users.

"It's very common for Indian users to choose short video for social networking, so it's easy to get favor with short video apps. Wechat is a communication application, which is about in the top 30 camp, and the total application ranking is within the top 200. Many Indian users need to use wechat for business communication with domestic users. " Pan Chaoxing, an analyst at touch treasure big data research institute, said in an interview with the 21st century economic report reporter that for these users, if wechat service stops, it will have a great impact.

It is reported that Tencent has predicted the risks in the market. An industry personage disclosed to the 21st century economic reporter that although the market share is small, it still has an impact on Tencent, which is equivalent to the termination of the local market development plan due to political factors. "However, because the Chinese app has been blocked back and forth several times before, the business layout strategy of domestic Internet companies in India has been adjusted, and they will not make too much investment. Tencent's investment focus is in Southeast Asia, not in India. "

Looking for the next fertile land

On July 28, Ji Rong, a spokesman for the Chinese Embassy in India, said on July 28 that China had made solemn representations to India and asked India to correct its mistakes.

Ji Rong said that the Indian government has the responsibility to safeguard the legitimate rights and interests of international investors, including Chinese enterprises, in accordance with market principles. The cooperation between China and India is mutually beneficial and win-win. This pattern of cooperation has been artificially damaged, and it is actually not in line with India's own interests. China will also take necessary measures to safeguard the rights and interests of Chinese enterprises.

In the opinion of the Internet industry interviewed, it still depends on the time and scope of India's ban on this batch of applications in China, as well as the developers' response to this part of the ban in India. At present, the first batch of apps banned in India are concentrated in the fields of tools, social networking and pan entertainment, which will have a great impact on such industries.

"The development of China's Internet in India is to a large extent to seize the huge number of users and traffic, believing that there may be a chance of success in the next China. However, models such as recruitment, education, o2o and so on are very dependent on offline, and the demand for localization is particularly high. In these emerging markets, no success can be directly replicated. " A local life service entrepreneur told 21st century business reporter that going to sea blindly may not be the best choice.

So, under the existing environment, what opportunities do Chinese Internet enterprises have in overseas markets? How to avoid the risk brought by geopolitics? Lu Wei, President of CDP group, a digital global human resources service organization, said in an interview with the 21st century economic report that although the development of the Internet and communication industry has no national boundaries, ethnic and spatial segregation, cultural integration is the prerequisite. India's self-protection of the country has not kept pace with the development of science and technology, thus restricting the smooth flow of technology. "At present, the companies we serve have not seen a decline in employment in India, but it is clear that companies are slowing down in terms of decision-making."

In her view, there is no need to worry about the economic effects of the Indian market. Even if the Indian market is lost, there are great opportunities in Africa, Southeast Asia and Latin America. In terms of the consumer market, the average consumption level in India is very low. In other words, 100 Indians may be equivalent to one person's consumption in the Middle East or Europe. In addition, India's Internet infrastructure, digital infrastructure and capital liquidity are relatively backward. "The globalization of Chinese enterprises must do two things well: one is the system of global governance, which should be very clear about the rules; the other is project management, which can achieve effective tracking and good quality control."

The so-called East is not bright, while the west is bright. After adjusting their strategies, Chinese Internet practitioners are also waiting for the opportunity to find the next blue ocean.

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