Last week,China’s antitrust authority summoned 34 top internet companies to talk about new fair-competition rules. Within hours,they were discussing business changes and publicly pledging to stay in line.
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“These new regulations are going to require internet platforms to look at how they innovate going forward,and the result is potentially less innovation,” said Gordon Orr,a non-executive board member at Meituan,the Chinese food delivery giant.
Even so,Alibaba and other internet titans have a status in China that could protect them from the most heavy-handed treatment. Officials have praised the titans’ economic contributions even as they tighten supervision. Xi wants China’s economy to be driven more by its own innovations than by those of fickle foreign powers.
That means it might be too soon to declare Jack Ma down for the count.
“His company is much more important to the success and functioning of the Chinese economy than any of the other entrepreneurs’,” McGregor said. “The government wants to continue to reap the benefits of his company — but on their terms. The government isn’t nationalising Alibaba. It isn’t confiscating its assets. It’s simply narrowing the field in which it operates.”
Alibaba declined to comment.
Ma is no neophyte at dealing with the authorities in China.
He worked briefly and unhappily at a government-run advertising agency before founding Alibaba in 1999. At the time,China was still getting used to the idea of powerful private entrepreneurs,and Ma proved adept at charming government officials.
“Alibaba absolutely has the chance to grow into a world-class company,” Wang Guoping,then the Communist Party secretary of the eastern city of Hangzhou,where Alibaba is based,said in the 2000s. “What a world-class company needs most is a soul,a commander,a world-class businessman. Jack Ma,I believe,meets this standard.”
When Ma stepped down as Alibaba’s chairman in 2019,a commentary in the official Communist Party newspaper declared:“There is no so-called Jack Ma era — only Jack Ma as part of this era.”
In 2011,Ma got a taste of how his ambitions might rub shareholders and regulators the wrong way. He quietly took over Alibaba’s payment service,Alipay,angering one of Alibaba’s biggest investors,Yahoo. Ma said the move had been necessary under new Chinese regulations. Alipay later became Ant Group.
“The Alipay transfer emboldened him,” said Duncan Clark,who has known Ma since 1999 and is chairman of BDA China,a consulting firm. “He kind of got away with it.”
As Alibaba grew,Ma began being courted by presidents and movie stars,but also by a wider coterie of fellow Chinese entrepreneurs. This “echo chamber” may have distorted Ma’s ideas about himself and his standing with the government,Clark said.
He might otherwise have seen the writing on the wall,particularly as Xi has pushed private businesses to work more closely with the state.
When Ma stepped down as Alibaba’s chairman in 2019,a commentary in the official Communist Party newspaper declared:“There is no so-called Jack Ma era — only Jack Ma as part of this era.”
Ma has largely vanished from sight within his companies,too. In January,he popped up in an internal chat group to answer a business question,according to a person who saw the message but was not authorised to speak publicly. Employees later shared Ma’s message to reassure nervous colleagues.
Recently,the Shanghai research group Hurun Report estimated that Ma was not,for the first time in three years,one of China’s three richest people. The country’s new No. 1 was Zhong Shanshan,the low-key head of both a bottled-water giant and a pharmaceutical business.
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When his water company went public last year,Zhong was so little known that Chinese news reports about his sudden wealth had to explain to readers how to pronounce an obscure Chinese character in his name.
The New York Times
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