Archives 2014

App developers given Google platform

The Google Inc stand at a mobile Internet expo in Beijing. The search provider has started to allow app developers in China to sell items through Google Play.

Google Inc is making its most aggressive move on the Chinese mainland since a high-profile exit from the market nearly five years ago.

The Internet giant said on Thursday that it has started to allow app developers in China to sell their products through Google Play, an online app store installed in more than 1 billion Android smartphones worldwide.

Industry sources speculated that Google is preparing for a more significant move that would let Android phone users in China download apps from the store, which cannot be done at present in the world’s biggest smartphone market.

Google was careful in phrasing its app announcement because the move could potentially make available the first major Google service in China since early 2010. After months of skirmishing with local regulators over information security, Google gradually withdrew its core services from the mainland in that year.

Google’s products, including its online search engine and mapping service, are not available on the mainland.

“Today we are simply opening Google Play to Chinese developers and giving them the ability to bring their applications to a global audience?just like what we’ve done in more than 60 other countries,” Google said in an e-mailed statement to China Daily.

Developers in China will be able to sell apps via Google Play in 130 overseas markets. Google will help developers collect revenues from in-app purchase and subscription services. The revenues will be transferred to developers’ Chinese bank accounts.

App developers in China had to find an overseas agent to manage the payments in the past.

Chris Yerga, Asia-Pacific managing director of Google Play, said: “Chinese developers will be able to explore global business through the Android platform. They will have a chance to build a real international business.”

Also on Thursday, US tech website The Information reported that Google intends to introduce a version of Google Play to China in hopes of tapping into a market that accounts for about half of the global population that is using the Google-developed Android operating system.

“The company has indicated its intention to reverse a longstanding Google policy and distribute its app store with phonemakers and other potential partners in China,” said the report, citing an unidentified source.

Google declined to comment.

Wang Jun, a senior analyst with Beijing-based consultancy Analysys International, said Google has already missed the key window of opportunity to return to the Chinese app market.

“Local players are taking firm control over the Android app-distribution market. There is not much room left for Google Play,” Wang said. He said that most Chinese smartphone producers do not pre-install Google Play on their devices, making it harder for the service to reach out to customers.

Baidu Inc, Qihoo 360 Technology Co Ltd and wandoujia are the country’s top three app distributors, according to the China Cloud Degree Registration Center, an app distribution monitoring organization. The three platforms handled more than 70 percent of the country’s total game app downloads as of August, the center said.

According to Google, more than 1 billion Android devices, including smartphones and tablets, are installed with Google Play globally. The app store now has more than 1 million utility and gaming apps with total downloads exceeding 50 billion.

Apple Inc, who operates Android’s rival system iOS, is also trying to grab more revenue in China. The company teamed up with local bankcard association China UnionPay in an attempt to spur app sales and to bundle more bankcards. It is launching a promotion campaign on the mainland by lowering some of the apps’ prices to 1 yuan (16 cents).

Chinese yuan-linked financial products rise in S Korea

The Chinese yuan-linked financial products rose in South Korea ahead of the launch of a market where currencies of the two countries would be traded directly and the implementation of a bilateral free trade agreement (FTA).

Shinhan Bank, one of South Korea’s four leading banks, said Thursday that it rolled out the yuan deposit product, named China Plus Time Deposit. It has five maturities, including one month and a year, and the deposit rate was set at 3.15 percent.

Hana Bank and Korea Exchange Bank launched a joint yuan deposit product with a maturity of six months and a year earlier this month. The deposit rate was more than 3 percent.

The yuan deposit rate almost doubled the rate of the South Korean won-denominated deposits offered by local banks. The won deposit rate stays at a mid- to upper-bound of 1 percent.

The rise in yuan-related financial products came as the two countries are expected to implement the bilateral FTA next year. South Korea plans to launch the direct trading market between the yuan and the won within this year.

A South Korean news media reported that the financial regulator plans to increase the portion of yuan settlement in trade with China to 20 percent in the long term.

In 2013, South Korea and China traded 228.8 billion U.S. dollars of goods and services, among which 1.2 percent was settled with the Chinese yuan.

Wuzhen to host World Internet Conference

The World Internet Conference, which will take place in Wuzhen, a town in East China’s Zhejiang province, on Wednesday, has attracted more than 1,000 participants from across the world.

The conference, held from Wednesday to Friday, will focus on several hot issues in the cyberspace, including cyber security, online anti-terrorism crackdown, mobile network and cross-border e-commerce.

It is the first time that China is holding such a top-level conference related to Internet. Guests include government officials from various countries, cyberspace specialists and technology enterprises tycoons, such as Zhou Hongyi, head of Qihoo 360, Chinese largest security software manufacturer, and Jack Ma, the founder and board chairman of Alibaba, China’s largest e-commerce business.

According to the organizer, the Cyberspace Administration of China, the country’s top Internet watchdog, the meeting has also attracted almost 700 journalists from the world and 500 volunteers have been deputed to serve the guests.

In addition, participants can enjoy fast-speed free Wi-Fi in Wuzhen, and the town will become the permanent place to hold the conference in future.

New copyright trading base set up in FTZ

Move aims to boost cross-border transactions

A national copyright trading base was launched in the China (Shanghai) Pilot Free Trade Zone (FTZ) Thursday, with the aim of using the advantages of the FTZ to promote the copyright industry, Chinese financial news portal yicai.com reported Thursday.

The national-level copyright trading base, which is the first of its kind in the Yangtze River Delta region, was approved by the National Copyright Administration on September 28, the report said.

Xu Jiong, director of the Shanghai Copyright Administration, said that the new base will protect copyright and encourage cross-border transactions for cultural products, according to the report.

Beneficial trade policies for the FTZ and the financial reforms that have been conducted there have already been positive for copyright trade growth, it noted.

The national base can be a helpful platform for individuals to sell the copyrights for their works, Wang Qian, a professor with the School of Intellectual Property at the East China University of Political Science and Law in Shanghai, told the Global Times Thursday.

However, it may not be that effective in terms of large-scale copyright transactions, such as for foreign movies, TV dramas or literature works that the Chinese market usually buys, he noted.

The copyrights for these cultural products are mainly held by large companies. For instance, the copyrights for animated films are dominated by two US-based firms – Walt Disney Company and Pixar Animation Studios – Wang noted.

For larger transactions such as this, sellers and buyers can easily reach each other without needing any special platforms, according to Wang.

Zhao Zhanling, a Beijing-based intellectual property lawyer, agreed with Wang and said that small copyright transactions may benefit from the new base in Shanghai.

Usually, copyright transactions for more popular products such as TV shows are dominated by a small number of companies, he told the Global Times Thursday.

For example, the fierce competition among China’s online video websites for copyrights for popular US TV dramas in previous years has forced up the prices, even if the battle for copyright has been less intense since two major video websites – youku.com and tudou.com – merged in August.

The new base in Shanghai might function as more than just a platform, according to financial news portal cs.com.cn, which reported Thursday that the base will seek policy breakthroughs in fields such as tax, financing and registration for copyright trade.

The FTZ facilitates overseas art works’ entry into the domestic market with fast customs clearance, and tariff and value-added tax (VAT) payments can be delayed until after sales rather than before, Li Wei, an employee at a cultural communications firm in Shanghai, was quoted as saying in the yicai.com report. Overseas buyers do not pay the 8 percent tariff and 17 percent VAT if cultural products are purchased through the FTZ, Li said.

China’s copyright trade is still at an early stage, cs.com.cn reported Thursday.

Cross-border copyright trade revenue is decided by a country’s soft power, Wang said, noting that China does not currently export as many cultural products as it imports.

Xiaomi, Youku Tudou agree video content cooperation

TV, smartphone hardware maker might also invest $300m in iQiyi video provider

Chinese smartphone maker Xiaomi Technology Co reached an agreement with US-listed Chinese video streaming firm Youku Tudou Inc Wednesday to invest in the distribution and production of online video content, a move analysts said will be a win-win solution for the two companies.

The two companies will cooperate in online video content and technologies, according to a press release that Xiaomi e-mailed to the Global Times Wednesday. It didn’t specify how much the smartphone maker would invest in the video streaming firm.

Xiaomi announced on November 4 that it would inject $1 billion to develop its Internet TV content.

“The first batch of money (of the $1 billion) has been invested in Youku Tudou… Xiaomi will join in content distribution and production with Youku Tudou to provide favorable content to Xiaomi fans… The two companies will dedicate themselves to pushing forward the online video industry in China,” Xiaomi founder and CEO Lei Jun said on his personal Sina Weibo account Wednesday.

To expand its TV content business, Xiaomi hired Chen Tong, a former executive at Chinese Internet firm Sina Corp, to manage its TV business.

Chinese media also reported Tuesday that Xiaomi will invest $300 million in online video provider iQiyi, which China’s biggest search engine Baidu Inc owns a 96 percent stake of.

Calls to iQiyi went unanswered by press time Wednesday while Xiaomi refused to comment on this event.

Xiaomi’s moves in video content come a year after it unveiled its first 47-inch smart TV in September 2013, which has since gradually gained popularity among users.

The burgeoning TV hardware business of Xiaomi, including its TV sets and set-top boxes, “has already developed well,” and further “expansion in TV content will increase its profit space further,” Luo Lan, an analyst at Analysys International, a Beijing-based Internet consultancy, told the Global Times Wednesday.

Luo suggested Xiaomi and Youku Tudou focus on improving the quality of their TV content in the face of intense competition in the sector.

In addition to Xiaomi, other Internet companies also launched smart TVs to capitalize on the burgeoning market.

In September 2013, China’s biggest search engine Baidu’s online video provider iQiyi launched a 48-inch smart TV called “TV+” in partnership with domestic TV maker TCL Corp. In the same month, domestic e-commerce giant Alibaba launched three smart TV models in partnership with Shenzhen-based appliance firm Skyworth.

Luo noted that the cooperation between Xiaomi and Youku Tudou was “a win-win solution,” as Xiaomi will enable Yuku Tudou to get more access to the huge amount of Internet and mobile users that Xiaomi has accumulated since it was set up in 2010.

Youku Tudou’s expertise in the production of original content will also be helpful for improving the user experience for Xiaomi TV and smartphones, said Luo.

The total sales value of Xiaomi smartphones, TV, as well as its set-top box on Tmall, a leading Chinese e-commerce website operated by Alibaba group, hit 1.56 billion yuan ($254.28 million) on November 11, which is dubbed “Singles’ Day” in China, Lei Jun disclosed on his Weibo.

Xiaomi ranked third in the global top smartphone manufacturers list due to its focus on China and adjacent markets, according to the latest report by the International Data Corporation (IDC), a global market research company.

According to IDC, the global market share of Xiaomi stood at 5.3 percent, following Samsung with 23.8 percent and Apple’s 12 percent in the third quarter.

Weaving a high road to growth

Workers at the Beijing Institute of Fashion Technology prepare traditional Chinese-style outfits for participants in the 22nd Asia-Pacific Economic Cooperation Economic Leaders’ Meeting held on Monday and Tuesday in Beijing.

Chinese silk company uses APEC platform to highlight global plans

Riding on the back of endorsements from global leaders during the Asia-Pacific Economic Cooperation leaders’ meeting in Beijing, Chinese silk major High Fashion Silk (Zhejiang) Co Ltd is looking to spread its reach beyond the nation and enhance its standing as an icon of Chinese culture, a company official said on Tuesday.

High Fashion Silk, a leading woven silk and knitting fabric producer from Xinchang in Zhejiang province, rocketed to instant fame after top global leaders wore the company’s glitzy New Chinese Suits during the APEC welcome ceremony in Beijing on Monday night.

“We are honored to be the sole fabric provider for the APEC meeting,” said Lin Ping, chairman and chief executive officer of High Fashion Silk. “China is the cradle of cultivated silk and we hope the endorsement from global leaders and their spouses will lead to more taking to Chinese-style fashion.”

Lin said the company had offered four lots of fabric totaling 6,000 meters for the APEC meeting. Two sets were made from the top mulberry silk, while the other two were a blend of top mulberry silk and wool.

“Our focus is to transform and become a cultural and creative company, based on supportive policies and our own advantages,” said Lin.

According to Lin, the entire fabric-making process for the APEC took over a month to complete. “We traveled on the ancient Silk Road to draw inspiration for colors and designs. The finished product was achieved after 60 processes spread over one month.

“The New Chinese Suit stands for peace, happiness and beauty,” Lin said.

The fabric designs for the APEC meeting represent China’s commitment and vision to be a global leader in quality, he said. The same vision has now been translated into the commercial parlance of haute couture, which refers to the creation of exclusive custom-fitted clothing.

“We are planning to open several stores in Beijing soon,” said Lin, adding that in Shanghai, the company has inked cooperation agreements with Donghua University (formerly China Textile University).

High Fashion Silk posted flat revenue growth of 1 billion yuan ($164 million) last year and a net profit of 30 million yuan during the same period. During the past three years, its total output in terms of value exceeded 2 billion yuan, with $80 million in exports.

The company has an annual production capacity of 10 million meters of woven silk, 1,000 metric tons of silk knitting fabrics, 3 million pieces of home textiles and 3 million silk neckties.

The company is also looking to improve its technology and innovative skills by using its 38 patents and advanced equipment from Italy, Germany, France, Switzerland and Japan.

The main brands, designers and retailers it cooperates with are the Guangzhou-based Exception de Mixmind, Uniqlo Co Ltd from Japan, and Calvin Klein Inc, Diane von Furstenberg and Macy’s Inc from the United States.

Besides High Fashion Group, the parent company of High Fashion Silk, other leading silk companies in China include Wujiang Dingsheng Silk Co Ltd in Jiangsu province, Hangzhou-based Wensli Group, Zhejiang Jiaxin Silk Co Ltd and Jiangsu Xinmin Textile Science and Technology Co Ltd.

China’s exports of genuine silk products in 2013 totaled $3.5 billion, up 3 percent, while imports rose 3.5 percent to $260 million, according to data from the General Administration of Customs.

Shanghai-based CharColn Consulting said the value of Chinese silk products accounts for less than 0.5 percent of the nation’s entire textile industry, but these are high-value products with a strong cultural aspects.

China’s chip industry awaits boom despite challenges

While China is known as the “world’s factory,” seemingly capable of making everything, semiconductor chips have been conspicuously absent on the “Made in China” list.

Statistics show that China’s chip imports in 2013 grew 20.5 percent to reach 231.3 billion US dollars, exceeding imports of other goods, including crude oil. In fact, they have consistently topped China’s import list over the past decade.

Considered “the heart” of all electronic devices, chips are vital for developing the broader information industry. Experts have called for more government support and industry innovation, as prolonged underdevelopment of China’s chip sector could derail the country’s economic upgrade and blunt its competitiveness.

SMALL CHIP, BIG BUSINESS

Chips are widely used in computers, consumer electronic devices, automotive electronics and Internet communications. Though small in size — and getting smaller as technology advances — chips are high in value and represent an important link in the information industry chain.

“There are several stages in the production of a semiconductor chip, including its design, manufacturing, assembly and testing,” said Zou Xuecheng, a professor of semiconductor engineering at Wuhan-based Huazhong University of Science and Technology.

A semiconductor chip with production value of 1 US dollar translates into 10 US dollars in growth for the related information industry, and adds 100 US dollars to a country’s Gross Domestic Product (GDP), Zou said, citing IMF research.

“With China’s consumption of chips exceeding 200 billion US dollars, it means 20 trillion in GDP growth for the world’s economy,” Zou added.

However, China has failed to make gains in the chip production process. Though China’s semiconductor use accounts for more than half of the global market, the country is overly dependent on foreign chip suppliers.

The market share for chips made by domestic manufacturers is merely 10 percent in China, according to Li Ping, vice general manager of XMC, a semiconductor manufacturer based in Wuhan.

Though 77 percent of cell phones sold on the global market are made in China, only 3 percent of chips in those phones are from Chinese suppliers, Li added.

According to a research report issued last year by the State Council, China’s cabinet, China has the capacity to produce around 1.2 billion cell phones, 350 million computers and 130 million color TVs a year. Yet, Chinese companies have been reduced to worker bees for the international companies that take the lion’s share of profits through patent fees on chips.

BOOM, BOON

China’s industry insiders lament being mired in a vicious circle: companies cannot gain a competitive edge and increase profits without owning key technologies, while meager profits limit their ability to invest in research and development.

Countries such as the United States and Japan have long attached great importance to the semiconductor industry, promoting it as a strategic sector with huge research expenditures funneled into the field.

The world’s leading chip makers spend lavishly on research and expanding their production capacity. Statistics show that in 2012, Samsung invested 14.2 billion US Dollars and Intel spent 12.5 billion US Dollars.

Those amounts dwarfed what Chinese players can earmark for chip research. The fledgling industry is faced with scanty resources, even with government help. Semiconductor Manufacturing International Corporation (SMIC), China’s biggest chip maker, is only able to spend 100 million US dollars on research and production expansion a year.

Financial aid alone, however, cannot pull Chinese chip makers up, as the sophisticated industry also calls for top talent.

“The key is an abundance of talented researchers, but we have seen an exodus of talent in recent years,” said Yang Zhiyong, general manager of the electronics division of Wuhan-based FiberHome Technologies Group.

Yang Chunshi, professor at Xiamen University, said research institutions should focus on developing technologies that are suitable for industrial applications instead of a blind pursuit of high-end technology. He added that companies should also take the initiative and embrace new technologies, as dated production modes spell trouble.

Ma Xinqiang, Chair of China’s HGTECH, believes that with patience and persistence, China’s chip industry can thrive as the ongoing “Third Industrial revolution” powered by the mobile Internet, the Internet of Things and cloud computing will unleash great potential.

Experts share Ma’s optimism. They predict that as the volume of China’s domestic chip industry is expected to reach 160 billion US dollars next year, the industry will see more positive changes.

Xiaomi to raise $1.5 bln in latest funding boost: report

Chinese smartphone manufacturer Xiaomi Inc. is talking to investors and banks to raise about 1.5 billion U.S. dollars in its fifth round of financing, local media reported.

The fundraising target is roughly 1.5 billion U.S. dollars, which would be the largest investment (excluding IPO) raised by any Chinese company backed by venture capital, financial news website Jiemian of the Shanghai United Media Group reported on Saturday.

One of the investors is said to be DST Global, a London-based investment firm that focuses on Internet companies, Jiemian said in the report.

Xiaomi, currently the world’s third-largest smartphone maker after Samsung and Apple, will use most of the money raised to develop video content for Xiaomi TV, according to the report.

Xiaomi has said it will spend about 1 billion U.S. dollars to expand its own TV content. It hired Chen Tong, former editor-in-chief of popular news portal Sina.com, to revamp its Internet video business.

Xiaomi founder and CEO Lei Jun said that Xiaomi shipped 18 million smartphones in the third quarter, an increase of 18 percent from the previous quarter.

For the first nine months, Xiaomi, whose name means “millet” in Chinese, shipped a total of 44 million units, Lei said.

Xiaomi was founded in April 2010 by Lei and his friends in Zhongguancun, Beijing’s technology hub, which has been called “China’s Silicon Valley.” Xiaomi’s first smartphone debuted on Aug. 16, 2011.

In another development, Hong Kong-based South China Morning Post reported on Thursday that Xiaomi Inc., which is valued at 50 billion U.S. dollars, is aiming for an initial public offering as early as next year.

“Xiaomi is one of the large Chinese technology companies that would tap the IPO market next year,” the newspaper quoted a source as saying. “Hong Kong investors seem to be more receptive of hardware than software firms, making the city the likely IPO destination for Xiaomi.”

The current market appetite for technology firms with a clear growth outlook, such as Alibaba Group, is an incentive to do it soon, the newspaper said.

Xiaomi is seen by investors as the most likely candidate to become the next “Chinese IT legend” after Alibaba, which completed a 25-billion-dollar IPO in the United States in September.

Global market researcher International Data Corporation (IDC) said in its latest report that Xiaomi jumped onto the list of top 5 manufacturers for the first time at the number 3 position thanks to its focus on China and adjacent markets, which resulted in triple-digit year-over-year growth.

In the third quarter of this year, Xiaomi’s global market share stood at 5.3 percent, following Samsung’s 23.8 percent and Apple’s 12 percent, according to IDC.

Foreign language apps find a larger following

There has been a surge in the use of foreign language apps accessed by smartphones, according to a survey, with women in particular keen to be taught via their handset.

The study, carried out jointly by the country’s leading Internet education provider Hujiang.com and the online education platform of Baidu Inc, shows the most popular customers are the female, college students or white-collar workers, under the age of 30?a profile which accounted for 80 percent of users of the services.

In a sizeable snapshot of 25,000 users of Internet-based education products, 58.4 percent were women.

“The young people are generally keen to improve themselves through multiple ways and resources,” said Dong Xiaoliang, director of mobile business department of Hujiang.

Some 44.7 percent of mobile education users were based in second-tier cities, 26.5 percent came from first-tier cities, and nearly 30 percent subscribed from third- and fourth-tier cities.

The survey found that laptop or computer-based online education was prevalent in cities throughout the country and included a wider cross-section of society, said Dong.

“Compared with other areas, first-tier cities on the whole have more abundant educational resources available, both online and offline.

“Resources in second-, third- or fourth-tier cities are accessed from more sources.”

Foreign language studies were by far the most popular type of course, with a dominant 89.3 percent of respondents, followed by those accessing courses in lifestyle and hobbies (13.8 percent), and career certification and examination (13.5 percent).

The report also revealed many were not deterred by cost, with nearly one-third of those surveyed saying they would happily spend 500 yuan ($82) or above, while 27.3 percent chose free offerings.

“In recent years people have got into the habit of making more payments for using their smartphones, helped by the increasing popularity of e-commerce apps,” Dong said.

About half of those surveyed said they used their educational apps before they went to bed, with 38.8 percent gaining access to their course riding in an automobile and 37.6 percent during their lunch break.

The average weekly time studying on their mobile device was five hours, the report said.

A 26-year-old woman respondent named Qi Na was included in the study.

“Smartphone-based education has made studies more convenient and efficient,” she said.

“For example, I can read English news through my mobile phone when I wait for a bus or take a break from work. And I don’t have to take a book with me every day.”

Li Xuhui, founder of the nonprofit online education website Kuxuexi, said smartphone-based Internet education is appealing especially to people who need to study at fragmented times.

“The innovation of Internet technology and the prevalence of PC and smartphones allow people to learn whenever they want and wherever they are,” Li said, adding that mobile Internet education will become more common.

According to the China Online Education Report 2013-14, released by Internet consultancy iResearch Group, the online education market in China was worth around 84 billion yuan in 2013, a 19.9 percent increase on the previous year.

The latest industry estimates suggest the number of online learners is expected to grow to 120 million over the next three years.