Tag: China

Chinese invest in British IP business

Beijing-cityguide-statue-xlargeChina’s Galaxy World Group  has announced a $30 million strategic investment in the British developer of intellectual property-based business, the IP Group.

The deal will be sorted out by 18 August 2017 but it will see Galaxy cooperate with the IP Group in various fields including potential co-investment in IP Group’s portfolio companies and continued exploration of further collaboration in both China and the UK.

Three other institutions are also joining this round as new investors – renowned Singaporean investment firm Temasek Holdings, British asset manager M&G and Australia’s Telstra in addition to support from IP Group’s existing shareholders.

IP Group is a listed British company that commercialises intellectual property from the world’s leading universities and research institutions.

The IP Group team has spent many years developing its approach to identifying attractive intellectual property (“IP”), nurturing and building businesses around such IP and then providing capital and support along the journey from “cradle to maturity”.

IP Group works in close cooperation with many top universities in countries including the UK, the US, Australia, and New Zealand.

According to IP Group’s announcement, the funds raised this time around will be used to support cooperation with elite universities around the world to commercialise outstanding intellectual property. Since its founding, IP Group has a proven track record of success with the gross internal rate of return (IRR) on its portfolio approximating 19 per cent and has created more than 2,000 new jobs.

Maodong Xu, the chairman of Galaxy Group, said: “The strategic investment into IP Group marks an important step for Galaxy to build a global entrepreneurial growth network. The cooperation with IP Group would enable us to quickly introduce cutting-edge technological projects in fields including the Internet, big data and AI from global top universities and will, in the form of co-funding, help these projects be in shape for a strong foothold in China.

In this way the world’s state-of-the-art research findings would be converted into technology products and applications so as to propel China’s industries to incorporate the Internet and smart technologies”.

Apart from its UK office, Galaxy Group has set up offices in countries including the US and Israel. The group’s global entrepreneurial growth network has already taken shape. By offering fundamental entrepreneurial services and playing the role of co-founder and industrial investor superpower, Galaxy Group’s network empowers start-ups with a highly friendly platform and helps them grow and compete in a better environment.

 

Chinese tech exports fall as trade war predicted

eclipse-chinaThe place where most tech gadgets are made is suffering from a fall in exports for the second year in a row.

Shipments are falling in the face of persistently weak global demand and officials voicing fears of a trade war with the United States this year.

Next week China’s leaders will see if President Donald (Prince of Orange) Trump will make good on a campaign pledge to brand Beijing a currency manipulator on his first day in office, and starts to follow up on a threat to slap high tariffs on Chinese goods. This will of course hit technology goods hard with most of them being made in China and exported to the US.

The world’s largest trading nation posted gloomy data  with 2016 exports falling 7.7 percent and imports down 5.5 percent. The export drop was the second annual decline in a row and the worst since the depths of the global crisis in 2009.

China’s trade surplus with the United States was $366 billion in 2015, and Trump could seize on in a bid to bring Beijing to the negotiating table to press for concessions. A sustained trade surplus of more than $20 billion against the United States is one of three criteria used by the U.S. Treasury to designate another country as a currency manipulator.

China is likely to point out that its own data showed the surplus fell to $250.79 billion in 2016 from $260.91 billion in 2015.

Trump’s trade policy will likely motivate US businesses to move their manufacturing facilities away from China which China might counter by moving to high end manufacturing which will cut costs.

China has a few weapons of its own. Beijing announced even higher anti-dumping duties on imports of certain animal feed from the United States than it proposed last year. It is also likely to protest to the IMF

This war of words will weaken investor confidence not only in the US and China.

China’s December exports fell by a more-than-expected 6.1 percent on-year, while imports beat forecasts slightly, growing 3.1 percent on its strong demand for commodities which has helped buoy global resources prices.

 

IDC says the channel must embrace the DX economy

chinaflagBeancounters at IDC have been telling the Chinese channel that it must rush to embrace the digital transformation (DX) economy and what applies there, should really apply to Blighty.

China’s economy has entered a period of transformation and both the governments and businesses alike are actively seeking new growth modes. Digital transformation (DX) of business, backed by the latest ICT technologies, is the answer.

IDC forecasts that digital transformation will attain macroeconomic scale over the next three to four years, changing the way enterprises operate and reshaping the global and Chinese economy. This is the dawn of the “DX Economy”.

Kitty Fok, Managing Director of IDC China, said: “DX will be a top priority for all business in the coming decade. Executives must adapt to the new rules of competition and accelerate DX process; meanwhile IT executives must take up new roles, transforming IT department into a strong technical partner. Executives of ICT vendors must be aware of their customers’ new demands, changing from its role of tech support to a DX partner for customers. ”

China is expected to continue growing steadily in 2017, with GDP growth of more than six percent.

IDC predicts that the Chinese IT market will expand by 2.3% in 2017, entering a period of adjustment.

Personal device market is likely to remain flat whereas the enterprise infrastructure hardware market is expected to grow 7.3 per cent in 2017. The Software market is forecast to expand 7.5 per cent, while the IT service market to grow 8.7 per cent. Growth in the traditional hardware, software and services is likely to slow, but rapid growth of 15 per cent or higher is forecast for markets that are associated with innovation accelerator technologies (3D printing, robotics, cognitive system, Internet of Things, AR and VR, and the next generation security) and the 3rd Platform (cloud computing, big data, mobile, social).

IDC said that we are looking at the dawn of the DX Economy and that by 2020, 50 per cent of China’s Top 1000 companies will see most their business depends on their ability to create digitally-enhanced products, services and experiences.

There will be mass customization to accelerate business transformation: By 2018, the top 10% of China’s industry leaders will develop the ability to allow customers to build custom product and service bundles. By 2018, Chinese companies investing in IoT-based operational sensing and cognitive-based situational awareness will see 40 per cent improvements in the cycle times of impacted critical processes.

Information-based products and services will start gaining popularity. In 2018, one fourth of China’s Top 1000 companies will gain the revenue from information-based products. By 2020, the demand for digital-related services will account for 30 per cent of total worldwide services spending.

Crowd-funding to improve startup’s success rate, IDC said. By 2019, China’s Top 500 firms and lots of internet companies will use Kickstarter-like methods to allocate capital to 10 per cent of new projects, aiming to increase their new product introduction success rates by over 30 per cent.

Digital revenue streams will drive business growth. By 2019, 20 per cent of China’s IT projects will create new digital services and revenue streams that monetise data. More than 20 per cent of CIOs will shift primary focus from physical to digital and move away from BPM and optimisation by 2018.

 

There will be more self-adaptive security and risk management. The Chinese will tighten policy on security and controllability, driving investment on IT security by governments and large state-owned enterprises to grow by 15 per cent on average annually. By 2018, half of CIOs will help drive global risk portfolios that enable adaptive responses to security, compliance, business, or catastrophic threats.

The new wave of cloud computing (dubbed Cloud 2.0) will facilitate ICT ecosystem revolution. IDC said that by 2020, 40 per cent of all enterprise IT infrastructure and software spending will be for cloud-based offerings.

“The Cloud will morph to become distributed, trusted, intelligent, industry-focused and channel-mediated. By 2018, the number of Industry Collaborative Clouds will be more than 40; by 2020, more than half of China’s Top 100 will be digital services suppliers through ICCs,” IDC said.

Security worries delays Ingram Micro take over

ingram-mico-hqWorries about security have forced the delay of Ingram Micro’s take over by a Chinese outfit.

Ingram says that the deal, which would see it part of the Tianjin Tianhai Investment Company  is  now being delayed until towards the end of the year

The first delay to the deal came last month when the Shanghai Stock Exchange sent a letter to Tianjin Tianhai asking for more details about the takeover. In that case the Exchange was worried about how the deal was being funded.

But now the Committee on Foreign Investment in the United States wants to take a close look at the deal.

“Ingram Micro today announced that the End Date by which the acquisition of Ingram Micro by Tianjin Tianhai Investment Company must be completed has been extended to November 13, 2016,” Ingram said.

Despite the CFIUS activity the expectation from both Ingram and on the Chinese side is that the deal will still close this year.

However it might not be that easy. The US is getting increasingly concerned about the involvement of the Chinese in business. Earlier this week it became clear that the Chinese company that is one of the main investors in the Hinkley Point nuclear power station is facing charges of nuclear espionage in the US.

Huawei ignores US to clean up

cia-cleanerDespite being on a US spying list, China’s Huawei technologies continues to clean up.

Huawei does not have to tell us much, because it is a private company, but the world’s No.2 telecommunications equipment maker, reported a 33 percent rise in profit for 2014.

This matches company guidance, as the global adoption of fourth-generation (4G) mobile technology boosted sales.

Net profit for 2014 rose to $45.7 billion US dollars, the Shenzhen-based company told media in an earnings briefing today.

In a breakdown, its revenue from telecom operator business rose 16.4 percent year on year, to $31 billion dollars; its revenue from enterprise business reached $3.1 billion dollars, up 27.3 percent year on year; and its revenue from consumer business reached $12.1 billion dollars, up 32.6 percent year on year.

Meanwhile, the company invested $66 billion dollars in research and development, rising 29.4 percent year on year and representing 14.2 percent of its annual sales revenue.

In the past ten years, Huawei’s investment in research and development accumulated to $307 billion dollars.

Either way, despite the US’s most ironic embargo, Huawei is doing rather well.

 

Chinese CEO calls Apple Nazis

donald-duck-funny-german-germany-hitler-nazi-Favim.com-91188Chinese CEO and billionaire Jia Yueting, has created a storm by comparing Apple to the Nazi Party.

For those who are not in the know, Jia Yueting is the chairman of Leshi Television, one of the China’s most popular online video sites. Jia’s private Leshi Holding (Beijing) invests in film and TV show production.

In a weibo post, Yueting compares the attributes of the Android and iOS ecosystems as “Crowdsourced, freedom vs arrogance, tyranny”, painting Apple as the villain.

He goes on to say, “Under the arrogant regime of iOS domination that developers around the world love yet hate, we are always carefully asking, ‘is this kind of innovation okay?'”

It might be that he is wanting a reasonable debate between closed and open source, he does not seem to want to make many friends by starting the debate by invoking Godwin.

The Tame Apple Press of course is spitting blood about the comments claiming that it must be some promotional move by LeTV to enter the smartphone industry. After all the only reason people need to criticise something as perfect as Apple is for click bait or marketing,

LeTV has already announced it will be creating an electric and autonomous vehicle as well, so to the Tame Apple Press that means that Yueting wants to be Apple.

“It is rather ironic that LeTV would use the Nazi Party as a symbolism of closed source systems, when modern day China is perhaps a more usable source, with Mainland China banned from seeing anything outside the “Great Firewall” and US companies regularly attacked by Chinese regulators,” hissed David Curry on Betanews .

He then attacks Xiaomi for copying Apple’s store layouts and TV designs, perhaps forgetting that Xiaomi is not LeTV.

Apple creates old lamps for new scheme in China

lampFruity cargo cult Apple thinks that the best way for punters behind the bamboo curtain to keep buying its expensive products is if they can trade them in like a car.

Jobs’ Mob plans to introduce a trade-in program for iPhones in China in association with Foxconn.

Under the deal, people will be able to exchange older iPhones at Apple stores in China for credit against the company’s products starting March 31.

Chinese demand for larger-screen iPhones helped fuel Apple’s record profit of $18 billion in the final quarter last year.

Apple Chief Executive Tim Cook has said China is poised to overtake the United States as the company’s biggest market, and he is working to about double the number of stores in Greater China by the middle of next year.

The only problem is that most of Apple’s potential customers will have to sell a kidney, or body part to get enough cash to buy a phone.

Under the China programme, Foxconn will buy the iPhones directly, without Apple taking ownership, and repair the devices if needed before selling them on its e-commerce websites such as FLNet and on Alibaba’s online store.

Foxconn, a key Apple supplier, is also in talks to sell the older iPhones in physical stores and may take the trade-in program online in future.

Apple has a similar scheme in the US, where the company has started accepting non-Apple devices, Bloomberg reported.

Major US wireless carriers including Verizon Communications and Sprint last year offered subscribers schemes under which they could trade in their old iPhones for new ones.

Hutchison Whampoa to buy 02

oxygen_maskHutchison Whampoa is expected to finalise a deal to buy Telefonica British mobile unit O2 for $15.70 billion today.

The companies did not face any major issues during the two months of due diligence, which could allow the deal to be announced on Tuesday.

The deal could be announced as early as this morning, but there is some possibility that it might be delayed.

Hutchison is chatting with wealth funds including China Investment Corporation, Singapore’s Temasek and GIC, and one of Qatar’s big government-sponsored outfits to provide the cash.

The company has plans to sell stake worth about 3 billion pounds, which makes about 30 percent of the group to outside investors, the newspaper reported.

Hutchison Whampoa is owned by Asia’s richest man, Li Ka-shing, and there might be those in the British government who are not that keen to have a British asset like O2 in the paws of the Chinese. However since no one minded when an Armada of Spanish financiers took the outfit out of British ownership, it is too late to bang Drake’s drum now.

IBM cosies up to China

ibm-officeThe CEO of IBM said she has a strategy in which her company will share tech with Chinese firms.

Virginia Rometty was speaking in Beijing at a government sponsored conference, according to Reuters.

She said that a country of over one billion people needed its own IT industry and it was unfair of foreign multinationals just to milk the market or use it as a place to manufacture kit.

Many foreign companies have made successful businesses in China by taking a partner in the country – the government makes this something of a condition in order to trade there.

The report said that IBM would let local companies build servers using the Power chip and also use the software for the mainframes.

The first beneficiary of the deal is a Chinese firm called Suzhou Powercore, which will manufacture the Power chips for home grown servers.

Rometty didn’t appear to speak of human rights in China, which remain an obstacle for other firms.

Chinese government downs Reuters

android-china-communistThe Chinese government seems to believe that if its citizens read Reuters websites their minds will be totally corrupted.

Reuters said both its English and Chinese websites were inaccessible in China today, and it appears to be the government that’s made them unavailable.

Communist China blocks a large number of foreign websites – the Wall Street Journal, the New York Times and Bloomberg are all banned.

Reuters asked the government internet watchdog what was going on but the watchdog doesn’t appear to be listening, yet.

The news service said in a statement that it is committed to fair and accurate journalism across world. “We recognise the great importance of news about China to all our customers, and we hope that our sites will be restored in China too,” Reuters said in a statement.

The company’s financial and data services to Chinese clients haven’t been tampered with.

 

Solar panels go through the roof

solarsA report said that total global solar photovoltaic (PV) capacity will be 498 gigawatts in 2019, a 177 percent increase over capacity in 2014.

IHS said that last year the market became supply driven. That trend will continue until 2019 when the use rate of module projection will exceed the peak usage rate in 2010. That is when the global market really started to soar.

As this chart from IHS shows, China leads the pack in using solar panels, followed by Japan, the USA, the UK, Germany and India.

Screen Shot 2015-03-20 at 11.03.43

And there’s good news if you’re in the mood to buy, because the average selling prices of standard modules will fall by 27 percent between 2015 and 2019.

Thin film modules aren’t experiencing stellar growth patterns, but IHS believes that this year market share for those will be around seven percent.

That market share is likely to remain at around seven percent between now and 2019.

 

Microsoft gives the Chinese free Windows 10

eclipse-chinaSoftware king of the world Microsoft has decided that the best way to stop the Chinese pirating its Windows 10 operating system is to give it to them.

Microsoft has decided to push into the heavily pirated Chinese consumer computing market this summer by offering free upgrades to Windows 10 to all Windows users, regardless of whether they are running genuine copies of the software.

The big idea is to get legitimate versions of VoleWare onto machines of the hundreds of millions of Windows users in China. Recent studies show that three-quarters of all PC software is not properly licensed there.

Terry Myerson, who runs Microsoft’s operating systems unit, announced the plan at the WinHEC technology conference in Shenzhen, China.

Microsoft will upgrade all qualified PCs, genuine and non-genuine, to Windows 10. The plan is to “re-engage” with the hundreds of millions of users of Windows in China, he said, without elaboration.

Windows 10 would be released globally sometime “this summer”. That is the first time Microsoft has put a time frame on the release, although it has been expected in autumn.

Microsoft said in January it would offer free upgrades to Windows 10 for users of Windows 7 or later in an attempt to hold onto users and make up for lost revenue by selling services such as Office over the Internet.

Microsoft is working with Lenovo to roll out Windows 10 in China to current Windows users, Myerson said.

It also is offering Windows 10 through security company Qihoo 360 Technology and Tencent Holdings, China’s biggest social networking company, which will build a Windows 10 app that will work on smartphones and PCs for its popular QQ gaming and messaging service. QQ has more than 800 million users.

Lenovo said in a statement that it will make phones running Windows software, available through China Mobile, sometime later this year.

 

China puts anti-western tech law on hold

1900-intl-forces-including-us-marines-enter-beijing-to-put-down-boxer-rebellion-which-was-aimed-at-ridding-china-of-foreigners-A law, China claimed was all about counter-terrorism but stopped US technology companies selling so much behind the bamboo curtain, has been put on hold.

A senior US official welcomed the move which he said was a good sign for Western businesses that saw the rule as a major impediment to working in the world’s second largest economy.

President Barack Obama said in an interview with Reuters on March 2 that he had raised concerns about the law directly with Chinese President Xi Jinping.

White House Cybersecurity Coordinator Michael Daniel said the Chinese have decided to suspend the third reading of that particular law, which has put the law on hiatus.

“We did see that as something that was bad not just for U.S. business but for the global economy as a whole, and it was something we felt was very important to communicate very clearly to them,” Daniel said.

The law would require technology firms to hand over encryption keys, the passcodes that help protect data, and install security “backdoors” in their systems to give Chinese authorities surveillance access.

The move has given companies “some breathing room, but not complete relief” because the bill could be picked up again at any point.

The thought is that the Chinese are not ready to kick out all foreign companies, and because they weren’t ready to take that step, they backed off.

The initial draft, published by the NPC late last year, requires companies to also keep servers and user data within China, supply law enforcement authorities with communications records and censor terrorism-related Internet content.

Although the law would apply to both domestic and foreign companies, officials in Washington and Western business lobbies complained that the combination of that law, the banking rules and anti-trust investigations amounted to unfair regulatory pressure targeting foreign companies.

 

Intel and Huawei snuggle up

cuddling-dog-catIntel and Huawei Technologies are getting closer even as their rival governments fall out over trade blocks.

According to Huawei, the pair are getting closer and will share technology and adopt Huawei branding behind the bamboo curtain to make Intel products more palatable to local buyers and the Chinese government.

The technology involved focuses on the cloud, with the pair working on a project to create new servers, a data centre, software and cyber security for a global cloud-computing network.

China’s government has been openly pushing for the use of more Chinese and less foreign-made technology, both to grow its own tech sector and as a response to Edward Snowden’s leaks about widespread US cyber surveillance.

Intel and Huawei have collaborated previously, including a server and cloud product team-up in 2012 and an agreement to cooperate on data storage last April.

Although the announcement is mostly Chinese focused it is likely that the Intel side of the deal will result in other products seen worldwide. Intel would take the lead in nations where Huawei is not trusted, and Huawei stepping forward in countries which are worried about US surveillance.

China irritates tech firms

chinaflagA law set to be passed by Chinese authorities would make tech vendors provide the government with encryption keys and put backdoors in systems.

According to Reuters, the law relates to counter terrorism and the legislation is likely to be passed into law in the near future.

Other elements of the counter terrorism law include a reqirement for companies to locate their servers and user data in China, as well as forcing vendors to censor content that China believes is related to terrorism.

China already forces banks to buy from home grown vendors, rather than buying abroad.

Reuters said that the implications of this new piece of legislation would be to forbid secure VPNs, to send financial information securely, and to hide any detail of a commercial business.

Google might find itself thanking its lucky stars that it doesn’t do business in mainland China, but other vendors including Apple, Intel and Microsoft will certainly be hit by the legislation.