CHINA TOPIX

Updated 6:02 PM EDT, Wed, Apr 01, 2020

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Alibaba, Tencent and other tech companies battle for market domination amid rapidly-changing consumer demand

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(Photo : Image by Tayeb MEZAHDIA from Pixabay )

Image by Tayeb MEZAHDIA from Pixabay

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Experts in the digital services sector in China discussed how Alibaba, Tencent, Metuan, Baidu and other tech companies battle for market domination amid rapidly-changing consumer demand. They discussed the investment strategies by analyzing the quarterly earnings of Tencent, Pinduoduo, and JD, the strongest competitors in the digital industry.

A host of Tech Node Elliot Zaagman and analyst and portfolio manager at Hullx Capital and co-host of the China Tech Investor Podcast James Hull discussed the adverse effects of the pandemic on the Chinese tech market. Their discussion was guested by keynote speaker on Digital China and Asia Tech and host of Jeff's Asia Tech Class Jeffrey Towson.

They claimed that China's economy will strengthen and the adverse effects of the pandemic would be short-lived. They also suggested that people should research and invest their cash on businesses that continue to grow despite the pandemic. It was also mentioned that Baby Boomers have been investing in businesses when prices are down. Hence, they claimed that businesses such as Tencent and Alibaba, two of China's strongest e-commerce giants, would be healthy investments in today's markets.

It was revealed that Chinese e-commerce apps have been experiencing consistent market growth, but the market competition continues to intensify. It was explained that the issue of 'forced exclusivity' that compels sellers or users to use their platforms to provide services, has been a common complaint among industry players. It was also explained that this was the reason why Tencent and Alibaba continue to enjoy market strength in China because of the popularity of their online applications.

Last November, China's market regulators showed that more than 20 e-commerce players forced sellers into exclusive agreements and that such practice is illegal. A self-identified customer service manager at Pinduoduo revealed that several of its employees received alerts from their accounts. The warnings said that they are not using the applications that are accessible until March 28, 2020.

The manager then said in a letter that it was an extension of Alibaba's 'forced' exclusivity and that the strategy was targeting Pinduoduo employees individually. She also claimed that the block of services would affect employees of Chinese artificial intelligence startup Yitu. The latter allegedly shares IP addresses with the app Pinduoduo since the two companies are located in Jinhongqiao International office in Shanghai.

It was also revealed that IPs at the manager's company at Tenga were also blocked because they were located in the same building. Another user claimed that a Quora-link query platform has also blocked services on an Alibaba platform including promotional coupons and discounts.

The user then shared a Weibo post explaining that platforms are open to all users but only restrict unruly practices. Personnel with the app then said that some users are blocked to prevent unscrupulous and disruptive practices on the platform.

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