156 countries commit to fair COVID-19 vaccine access, but US won’t join

World Health Organization (WHO) Director-General Tedros Adhanom Ghebreyesus attends a press conference organized by the Geneva Association of United Nations Correspondents (ACANU) amid the COVID-19 outbreak, caused by the novel coronavirus, on July 3, 2020 at the WHO headquarters in Geneva.

Enlarge / World Health Organization (WHO) Director-General Tedros Adhanom Ghebreyesus attends a press conference organized by the Geneva Association of United Nations Correspondents (ACANU) amid the COVID-19 outbreak, caused by the novel coronavirus, on July 3, 2020 at the WHO headquarters in Geneva. (credit: Getty | Fabrice Cof)

A total of 156 countries—representing about 64 percent of the world’s population—have committed to pooling resources to help develop, buy, and equitably distribute two billion doses of a COVID-19 vaccine by the end of 2021.

“This isn’t just the right thing to do, it’s the smart thing to do,” said Dr. Tedros Adhanom Ghebreyesus, director-general of the World Health Organization, which is co-leading the effort along with the Coalition for Epidemic Preparedness Innovations (CEPI) and Gavi, the Vaccine Alliance.

So far, 64 high-income countries have signed on to the effort, as well as 92 low- and middle-income countries, which would be eligible for support in procuring vaccine doses. Gavi CEO Seth Berkley said in a WHO press conference on Monday that he expects 38 more countries to sign up in the coming days.

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#china, #covax, #covid-19, #infectious-disease, #pandemic, #policy, #public-health, #russia, #sars-cov-2, #science, #us, #vaccine, #who


TikTok, WeChat and the growing digital divide between the U.S. and China

Over the past decade, the dynamic between Chinese and United States tech companies has undergone dramatic shifts. Once seen as a promising market for American companies, that narrative flipped as China’s tech innovation and investment power became increasingly evident, and the expanding reach of the Chinese Communist Party’s cybersecurity regulations fueled concerns about data privacy. For years, however, there still seemed to be room for a flow of ideas between the two countries. But that promise has eroded, against the backdrop of the tariff wars and, most recently, the Trump administration’s executive orders against TikTok and WeChat.

The U.S. Commerce Department was set to enforce the shutdown of TikTok and WeChat in the United States last weekend, but both apps got reprieves. In WeChat’s case, a U.S. district court judge issued a temporary stay against the ban, while TikTok owner ByteDance is in the process of finalizing a complicated deal with Oracle.

The TikTok and WeChat imbroglios underline how much America’s perception of Chinese tech has evolved. Not only is TikTok the first consumer app by a Chinese company to gain a major foothold in the United States, but it’s also had a significant impact on popular culture there. This would have been almost unimaginable just ten, or even five, years ago.

China as a target for expansion

For a long time, China, with its population of 1.4 billion people, was seen as a lucrative market by many foreign tech companies, even as government censorship began to expand. In 2003, China’s Ministry of Public Security launched the Golden Shield Project, commonly referred to as the Great Firewall of China, the apparatus that controls what overseas sites and apps Chinese internet users have access to. At first the Great Firewall mainly targeted access to Chinese-language sites with anti-Chinese Communist Party content. Then it began blocking more services.

A laptop computer screen in Beijing shows the homepage of Google.cn, 26 January 2006, a day after its debut in mainland China where the US online search engine launched a new service after agreeing to censor websites and content banned by the Beijing authorities (AFP PHOTO/Frederic J. BROWN)

A laptop computer screen in Beijing shows the homepage of Google.cn, 26 January 2006, a day after its debut in mainland China where the US online search engine launched a new service after agreeing to censor websites and content banned by the Beijing authorities (AFP PHOTO/Frederic J. BROWN)

Even as the Communist Party’s online censorship became more stringent, many American internet companies were still keen to expand into China. Perhaps the most prominent example from that era is Google, which added Chinese support to Google.com in 2000.

Though access to the search engine was spotty (according to a 2010 timeline from the Financial Times, this may have been because of “extensive filtering” by China’s licensed internet service providers) and it was briefly blocked in 2002, Google continued launching new services targeted to users in China, including a simplified Chinese language version of Google News.

Then in 2005, the company announced plans to set up a research and development center in China. The next year, it officially launched Google.cn. In order to do so, Google agreed to exclude search results on sensitive political topics, causing controversy.

Despite its concessions to the Chinese government, Google’s relationship with China began deteriorating, foreshadowing what other foreign tech companies, particularly those offering online services, would deal with when they tried to enter China. After being blocked on and off, access to YouTube was completely cut off in 2009 after footage was uploaded that appeared to show the brutal beatings of Tibetan protestors in Lhasa. That year, China also blocked access to Facebook and Twitter.

In January 2010, Google announced it was no longer willing to censor searches in China and would withdraw from the country if necessary. It also began redirecting all search queries on Google.cn to Google.com.hk.

But the company continued its R&D operations there and maintained a sales team. (In 2018, an investigation by The Intercept found that Google had started to work on a censored search engine for China again, code-named “Project Dragonfly”). Other big U.S. tech companies also continued courting China, even though their services were blocked there.

For example, Facebook chief executive Mark Zuckerberg made several trips to China in the mid-2010s, including a 2015 visit to Tsinghua University, a leading research university. Zuckerberg had joined the university’s board the previous year, and delivered several public talks in Mandarin. Speculation mostly focused on Facebook’s efforts to get a version of its service into China, but China-based companies were, and continue to be, one of Facebook’s most important sources of advertising revenue.

Chinese government policies designed to help domestic companies become more competitive also began to have an impact and by 2015, many American tech firms needed to find a local partner to enter China. The narrative that China needed American tech innovation began to turn on its head.

A shifting dynamic

Since Google Play was also blocked in China, that led the way for the rise of third-party Android app stores, including Chinese internet giant Tencent’s My App.

But Tencent’s most influential product is WeChat, the messenger that launched in 2011. Two years later, Tencent added mobile payments by integrating it with TenPay. In less than five years, WeChat became a vital part of daily life for hundreds of millions of users in China. WeChat Pay and Alibaba’s Alipay, its main competitor, have revolutionized payments in China, where about one-third of consumer payments are now cashless, according to research by think tank CGAP.

BEIJING, CHINA - SEPTEMBER 19: A Chinese customer uses his mobile to pay via a QR code with the WeChat app at a local market on September 19, 2020 in Beijing, China. (Photo by Kevin Frayer/Getty Images)

BEIJING, CHINA – SEPTEMBER 19: A Chinese customer uses his mobile to pay via a QR code with the WeChat app at a local market on September 19, 2020 in Beijing, China. (Photo by Kevin Frayer/Getty Images)

In 2017, Wechat launched “mini-programs,” that allows developers to create “apps within an app” that run on WeChat. The program took off quickly, and within less than two years, Tencent said it had reached one million mini-programs and 200 million daily users. Even Google quietly launched its own mini-program in 2018.

Despite its ubiquity in China, WeChat’s international presence is relatively small, especially when compared to other messengers like WhatsApp. WeChat claims more than one billion monthly active users in total, but only an estimated 100 million to 200 million are international users. Many are members of the Chinese diaspora who use it to keep in touch with family and associates in mainland China since many other popular messengers, including WhatsApp, Facebook Messenger and Line, are blocked there.

In the meantime, another company was gaining ascendancy, and would eventually succeed where Tencent hadn’t.

Founded in 2012 by Microsoft veteran Zhang Yiming, ByteDance had its own early run-ins with the Chinese government. The first app it launched, a social media platform called Neihan Duanzi that reached 200 million users by 2017, was shut down the next year after the National Radio and Television Administration accused it of hosting inappropriate content. Despite that early setback, ByteDance continued to grow, releasing apps like Toutiao, one of China’s top news aggregators.

But the product it is best known for launched in 2016. Called Douyin in China, ByteDance always planned to expand the short video-sharing app overseas. In an interview with Chinese tech news site 36Kr, Zhang said, “China is home to only one-fifth of the world’s internet users. If we don’t expand globally, we are bound to lose to our peers eyeing the rest of the world” — both echoing and contravening the viewpoint of U.S. internet companies that had seen China as a crucial market.

TikTok, the international version of Douyin, was launched in 2017. That year, ByteDance also bought Musical.ly, a lip-syncing app popular with teens, in a deal worth between $800 million to $1 billion. ByteDance merged Musical.ly with TikTok, consolidating their audiences.

By early 2019, TikTok had become popular among teens and people in their early 20s, though many older people still struggled to understand its appeal. But as TikTok was turning into a mainstay of Gen Z culture, it also began to face scrutiny by the U.S. government. In February 2019, the Federal Trade Commission fined TikTok $5.7 million for violating children’s privacy laws.

Then a few months later, the U.S. government reportedly began a national security review of TikTok, marking the first in a chain of events that led to Trump’s August executive order against the company, and ByteDance’s new, but confusing, agreement with “trusted technology partner” Oracle.

The impact of China’s 2017 cybersecurity law

The United States is not the only country where TikTok has been deemed a national security threat. In June, it was among 59 apps developed by Chinese companies banned in India for threatening the country’s “national security and defence.” It’s also under investigation by French data security watchdog CNIL over how it handles user data.

While some cybersecurity experts believe that TikTok’s data collection practices are similar to other social media apps that depend on targeted ads for revenue, the heart of the issue is a Chinese law, implemented in June 2017, that requires companies to comply with government requests for data stored in China. ByteDance has insisted repeatedly it would resist attempts by the Chinese government to access U.S. users’ data, which it says is stored in the United States and Singapore.

“Our data centers are located entirely outside of China, and none of our data is subject to Chinese law,” TikTok wrote in a October 2019 statement. “Further, we have a dedicated technical team focused on adhering to robust cybersecurity policies, and data privacy and security practices.”

In the same post, TikTok also addressed concerns that it censors content, including videos about the Hong Kong protests and China’s treatment of Uighurs and other Muslim groups. “We have never been asked by the Chinese government to remove any content and we would not do so if asked. Period,” the company said.

WeChat and TikTok’s uncertain future in the U.S.

But as a Chinese company, ByteDance is ultimately still beholden to Chinese laws. Earlier this week, ByteDance said it will retain an 80% stake in TikTok, after selling a total of 20% to Oracle and Walmart. Then Oracle executive vice president Ken Glueck said that Oracle and Walmart would make their investment upon the creation of a new entity called TikTok Global. He added that ByteDance will have no ownership in TikTok Global.

This creates more questions, but doesn’t answer the most pressing one: how close will the U.S. version of TikTok remain to ByteDance, and will it still be subject to the Chinese cybersecurity regulations that cause so much concern?

Around the same time that ByteDance’s proposed deal with Oracle and Walmart was announced, a U.S. district court judge temporarily stayed the nationwide ban on WeChat, as part of a case brought against the U.S. government by the U.S. WeChat Users Alliance, a nonprofit organization initiated by attorneys who want to preserve access to WeChat for users in America. In her opinion, Judge Laurel Beeler wrote, “while the government has established that China’s activities raise significant national-security concerns—it has put in scant little evidence that its effective ban of WeChat for all U.S. users addresses those concerns.”

On its site, the U.S. WeChat Users Alliance said it believes Trump’s August 6 executive order against WeChat “violates many provisions of the U.S. Constitution and the Administrative Procedure Act.” Furthermore, the group argued that a WeChat ban would “severely affect the lives and the work of millions of people in the U.S.” who use WeChat to talk to family, friends and business associates in China.

While WeChat is heavily censored, users have often found ingenious ways to bypass bans on topics deemed sensitive by the Chinese government. For example, people used emojis, PDFs and fictional languages like Klingon to share an interview with Ai Fen, the director of Wuhan Central Hospital’s emergency department and one of the first whistleblowers to sound the alarm about COVID-19 even as the government attempted to stifle information about the disease.

The growing divide

The U.S. government’s actions against TikTok and WeChat are taking place against an increasingly fraught political landscape. Huawei and ZTE were first identified as potential threats to U.S. national security in a 2012 bipartisan House committee report, but legal actions against Huawei, one of the world’s biggest telecom equipment suppliers, escalated under the Trump administration. These include criminal charges brought against Huawei by the Department of Justice, and the arrest and indictment of chief financial officer Meng Wanzhou.

The U.S. government’s actions in the name of national security doesn’t just affect the Chinese government or China’s biggest companies. It also impacts individuals, as in the case of increasingly stringent visa restrictions for Chinese students.

At the same time, the Great Firewall has become more restrictive under President Xi Jinping’s regime and China’s cybersecurity laws are becoming increasingly invasive, granting the government even more access to citizens’ data. Increasingly sophisticated surveillance technology has been used to monitor Uighurs and other ethnic minorities, and a crackdown on VPN services that began escalating in 2017 is making it harder for people in China to circumvent the Great Firewall.

When compared to these social issues, the future of a video-sharing app might seem relatively minor. But it underscores one of the most unsettling developments in the relationship between U.S. and China over the past ten years.

In a prescient 2016 Washington Post article titled “America wants to believe China can’t innovate. Tech tells a different story,” Emily Rauhala wrote “China’s tech scene is flourishing in a parallel universe.” TikTok’s deep cultural impact gave a glimpse of what is possible when two parallel universes connect. Along with geopolitical tensions, the furore over TikTok and WeChat uncovers something else: that the exchange of ideas and information between people in two of the world’s most powerful countries is becoming increasingly restricted due to circumstances beyond their control.

#apps, #bytedance, #china, #policy, #tc, #tencent, #tiktok, #united-states, #wechat


Chinese City of Lanzhou Orders Taxi Drivers to Remove Tattoos

Officials in Lanzhou said tattooed drivers could “cause distress” to passengers. The order has revived a debate over stigmatized body art.

#china, #tattoos, #taxicabs-and-taxicab-drivers


Human Rights Are Like Fire Departments. You Really Need Them.

They may be less appealing than economic prosperity, but they are indispensable.

#arendt-hannah, #china, #communist-party-of-china, #erdogan-recep-tayyip, #fukuyama-francis, #human-rights-and-human-rights-violations, #rawls-john, #turkey


China’s electric carmaker WM Motor pulls in $1.47 billion Series D

Chinese electric vehicle startup WM Motor just pocketed an outsize investment to fuel growth in a competitive landscape increasingly coveted by foreign rival Tesla. The five-year-old company raised 10 billion yuan ($1.47 billion) in a Series D round, it announced on Tuesday, which will pay for research and development, branding, marketing and expansion of sales channel.

WM Motor, backed by Baidu and Tencent, is one of the highest funded EV startups in China alongside NIO, Xpeng and Li Auto, all of which have gone public in New York. With its latest capital boost, WM Motor could be gearing up for an initial public offering. As Bloomberg’s sources in July said, the company was weighing a listing on China’s Nasdaq-style STAR board as soon as this year.

Days before its funding news, WM Motor unveiled its key partners and suppliers: Qualcomm Snapdragon’s cockpit chips will power the startup’s in-cabin experience; Baidu’s Apollo autonomous driving system will give WM vehicles self-parking capability; Unisplendour, rooted in China’s Tsinghua University, will take care of the hardware side of autonomous driving; and lastly, integrated circuit company Sino IC Leasing will work on “car connectivity” for WM Motor, whatever that term entails.

It’s not uncommon to see the new generation of EV makers seeking external partnerships given their limited experience in manufacturing. WM Motor’s rival Xpeng similarly works with Blackberry, Desay EV and Nvidia to deliver its smart EVs.

WM Motor was founded by automotive veteran Freeman Shen, who previously held executive positions at Volvo, Fiat and Geely in China.

The startup recently announced an ambitious plan for the next 3-5 years to allocate 20 billion yuan ($2.95 billion) and 3,000 engineers to work on 5G-powered smart cockpits, Level-4 driving and other futuristic auto technologies. That’s a big chunk of the startup’s total raise, which is estimated to be north of $3 billion, based on Crunchbase data and its latest funding figure.

Regional governments are often seen rooting for companies partaking in China’s strategic industries such as semiconductors and electric cars. WM Motor’s latest round, for instance, is led by a state-owned investment platform and state-owned carmaker SAIC Motor, both based in Shanghai where the startup’s headquarters resides. The city is also home to Tesla’s Gigafactory where the American giant churns out made-in-China vehicles.

In July, the Chinese EV upstart delivered its 30,000th EX5 SUV vehicle, which comes at about $22,000 with state subsidy and features the likes of in-car video streaming and air purification. The company claimed that parents of young children account for nearly 70% of its customers.

#asia, #automotive, #china, #electric-vehicle, #ev, #funding, #fundings-exits, #wm-motor


China Sentences Ren Zhiqiang, Tycoon Who Criticized Xi, to 18 Years in Prison

The Communist Party had accused Ren Zhiqiang of being disloyal. His heavy sentence underscores Xi Jinping’s crackdown on dissent among the elite.

#beijing-china, #china, #communist-party-of-china, #politics-and-government, #ren-zhiqiang, #xi-jinping


TikTok Deal with Oracle, Walmart Trips Over U.S.-China Feud

Companies involved in a deal to resolve TikTok’s future publicly clashed over the arrangement, while President Trump threatened to block any deal that left the service in Chinese hands.

#beijing-bytedance-technology-co-ltd, #china, #computers-and-the-internet, #mergers-acquisitions-and-divestitures, #mobile-applications, #oracle-corporation, #politics-and-government, #social-media, #stocks-and-bonds, #tiktok-bytedance, #trump-donald-j, #united-states-politics-and-government


Everything we know so far about Oracle not actually buying TikTok

A casually dressed young woman shrugs while holding the logos of two competing companies.

Enlarge / ¯\_(ツ)_/¯ (credit: Aurich Lawson / Getty Images)

It was a weird weekend to end a weird summer for one of the country’s most poular social media apps, TikTok. First, in August, the Trump administration threatened to ban TikTok unless it found a US buyer. Then last weekend, one-time dark horse Oracle emerged victorious in a federally mandated contest to acquire TikTok. Except, it turns out, Oracle isn’t actually acquiring TikTok at all—and Oracle and TikTok’s current parent company, ByteDance, disagree on who is going to be in charge.

If you’re confused, you’re in good company. Here’s our attempt to lay out everything we know about TikTok, Oracle, and their mysterious deal so far.

What is TikTok? Who owns it?

TikTok is an extremely popular short-form video app used worldwide. The app appeared in its current incarnation after its parent company, Beijing-based ByteDance, acquired US startup Musical.ly in 2017 and integrated it with its existing TikTok product under the TikTok name.

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#bans, #china, #explainers, #policy, #tiktok, #trade-war, #trump, #trump-administration, #wechat, #white-house


Amnesty calls for human rights controls on EU digital surveillance exports

In a new report, Amnesty International says it’s found evidence of EU companies selling digital surveillance technologies to China — despite the stark human rights risks of technologies like facial recognition ending up in the hands of an authoritarian regime that’s been rounding up ethnic Uyghurs and holding them in “re-education” camps.

The human rights charity has called for the bloc to update its export framework, given that the export of most digital surveillance technologies is currently unregulated — urging EU lawmakers to bake in a requirement to consider human rights risks as a matter of urgency.

“The current EU exports regulation (i.e. Dual Use Regulation) fails to address the rapidly changing surveillance dynamics and fails to mitigate emerging risks that are posed by new forms of digital surveillance technologies [such as facial recognition tech],” it writes. “These technologies can be exported freely to every buyer around the globe, including Chinese public security bureaus. The export regulation framework also does not obligate the exporting companies to conduct human rights due diligence, which is unacceptable considering the human rights risk associated with digital surveillance technologies.”

“The EU exports regulation framework needs fixing, and it needs it fast,” it adds, saying there’s a window of opportunity as the European legislature is in the process of amending the exports regulation framework.

Amnesty’s report contains a number of recommendations for updating the framework so it’s able to respond to fast-paced developments in surveillance tech — including saying the scope of the Recast Dual Use Regulation should be “technology-neutral”, and suggesting obligations are placed on exporting companies to carry out human rights due diligence, regardless of size, location or structure.

We’ve reached out to the European Commission for a response to Amnesty’s call for updates to the EU export framework.

The report identifies three EU-based companies — biometrics authentication solutions provider Morpho (now Idemia) from France; networked camera maker Axis Communications from Sweden; and human (and animal) behavioral research software provider Noldus Information Technology from the Netherlands — as having exported digital surveillance tools to China.

“These technologies included facial and emotion recognition software, and are now used by Chinese public security bureaus, criminal law enforcement agencies, and/or government-related research institutes, including in the region of Xinjiang,” it writes, referring to a region of north-west China that’s home to many ethnic minorities, including the persecuted Uyghurs.

“None of the companies fulfilled their human rights due diligence responsibilities for these transactions, as prescribed by international human rights law,” it adds. “The exports pose significant risks to human rights.”

Amnesty suggests the risks posed by some of the technologies that have already been exported from the EU include interference with the right to privacy — such as via eliminating the possibility for individuals to remain anonymous in public spaces — as well as interference with non-discrimination, freedom of opinion and expression, and potential impacts on the rights to assembly and association too.

We contacted the three EU companies named in the report for a response.

At the time of writing only Axis Communications had replied — pointing us to a public statement, where it writes that its network video solutions are “used all over the world to help increase security and safety”, adding that it “always” respects human rights and opposes discrimination and repression “in any form”.

“In relation to the ethics of how our solutions are used by our customers, customers are systematically screened to highlight any legal restrictions or inclusion on lists of national and international sanctions,” it also claims, although the statement makes no reference to why this process did not prevent it from selling its technology to China.

On the domestic front, European lawmakers are in the process of fashioning regional rules for the use of ‘high risk’ applications of AI across the bloc — with a draft proposal due next year, per a recent speech by the Commission president.

Thus far the EU’s executive has steered away from an earlier suggestion that it could seek a temporary ban on the use of facial recognition tech in public places. It also appears to favor lighter touch regulation which defines only a sub-set of ‘high risk’ applications, rather than imposing any blanket bans. Additionally regional lawmakers have sought a ‘broad’ debate on circumstances where use of remote use of biometric identification could be justified, suggesting nothing is yet off the table.

#amnesty-international, #artificial-intelligence, #china, #digital-surveillance, #eu, #europe, #human-rights


‘There’s No There There’: What the TikTok Deal Achieved

The agreement for the social media app falls short of President Trump’s promises.

#beijing-bytedance-technology-co-ltd, #china, #computer-security, #computers-and-the-internet, #executive-orders-and-memorandums, #mobile-applications, #oracle-corporation, #social-media, #suits-and-litigation-civil, #tiktok-bytedance, #trump-donald-j, #united-states-politics-and-government, #walmart-stores-inc


China T.V. Show Praising Coronavirus Fight Sparks a Backlash from Women

A scene from a state-sponsored show extolled men who volunteered but played down women’s contributions. Internet users are calling for the show to be pulled from the air.

#china, #coronavirus-2019-ncov, #discrimination, #propaganda, #social-media, #volunteers-and-community-service, #women-and-girls


President Trump reportedly has approved the Oracle deal for TikTok’s US operations

President Donald Trump said has has given his stamp of approval “in concept” on the Oracle bid for the U.S. operations of the wildly popular social media app, TikTok, according to a report from Bloomberg.

According to the Bloomberg report Trump said, “I have given the deal my blessing,” as he left the White House for a campaign rally in North Carolina on Saturday.

“I approved the deal in concept,” Trump reportedly said.

The spinout of TikTok’s U.S. operations from its parent company Bytedance was something that Trump administration had demanded on the grounds that the company’s data handling policies and popularity in the U.S. posed a national security threat.

The President’s push to sever the applications ties to China also followed TikTok users’ alleged prank that turned what was supposed to be a triumphal rally for the President in Oklahoma City into a Presidential campaign embarrassment that cost the job of Trump’s campaign manager, Brad Parscale.

That said, the U.S. has been looking to curtail the operations of several Chinese technology companies on the grounds that they pose security threats to the U.S. Indeed, the Presidential order that demanded TikTok’s spinout also called for the discontinuation of the U.S. operations of the messaging service WeChat, which is owned by Tencent — one of China’s largest technology companies. And the U.S. government has also put a target on the telecommunications and networking technology developer, Huawei.

With the TikTok deal set to be approved, a new company called TikTok Global will be created as part of the deal, according to statements from Treasury Secretary, Steven Mnuchin, earlier this week.

Bloomberg reported that Trump said the new company would be headquartered in Texas, would hire as many as 25,000 people and would contribute $5 billion toward U.S. education.

The bulk of TikTok’s U.S. operations are now in Los Angeles.

As the Trump Administration continues its push to disrupt the operations of Chinese tech companies in the U.S., strange bedfellows are uniting to voice opposition to the deal.

On Friday, the American Civil Liberties Union and the head of Facebook’s Instagram subsidiary both came out with statements opposing the proposed transaction.

“This order violates the First Amendment rights of people in the United States by restricting their ability to communicate and conduct important transactions on the two social media platforms,” said Hina Shamsi, director of the American Civil Liberties Union’s National Security Project, in a statement on Friday.

And the dragnet against Chinese influence through ownership of U.S. technology companies has reportedly widened to include many of the top U.S. gaming companies, which have been backed (or are wholly owned) by Tencent.

All of this could be exceptionally bad for U.S. technology businesses, as Instgram’s chief, Adam Mosseri pointed out in a series of Friday tweets.

“A US ban of TikTok would be meaningful step in the direction of a more fragmented nationalized internet, which would be bad for US tech companies which have benefited greatly from the ability to operate across borders,” Mosseri wrote.

#brad-parscale, #bytedance, #campaign-manager, #china, #companies, #donald-trump, #huawei, #los-angeles, #mobile-applications, #north-carolina, #oracle, #president, #social-media-app, #software, #tc, #technology, #telecommunications, #tencent, #texas, #tiktok, #trump-administration, #u-s-government, #united-states, #white-house


After Trump’s TikTok Ban, China Readies Blacklist of Foreign Companies

Beijing issued rules that could allow it to halt exports, imports and investments by businesses accused of endangering national security.

#blacklisting, #china, #foreign-investments, #international-trade-and-world-market, #politics-and-government, #tiktok-bytedance, #united-states-international-relations, #wechat-mobile-app


China Sends Warning to U.S. and Taiwan With Aerial Drill

Beijing sent 18 aircraft into the Taiwan Strait as a senior American diplomat held meetings on the island.

#china, #defense-and-military-forces, #lee-teng-hui, #politics-and-government, #taiwan, #tsai-ing-wen, #united-states, #united-states-international-relations


Chinese Communist Party Seeks Sway Over Private Business

Party leaders have pledged to increase their influence over entrepreneurs even as they promise greater aid, reflecting Xi Jinping’s greatest — and sometimes conflicting — challenges.

#china, #communist-party-of-china, #economic-conditions-and-trends, #entrepreneurship, #politics-and-government


TikTok Accepts Deal Revisions as Trump Prepares to Review Proposal

The video app is also looking for a new chief executive and has talked to candidates including a founder of Instagram.

#beijing-bytedance-technology-co-ltd, #china, #computer-security, #computers-and-the-internet, #executive-orders-and-memorandums, #mobile-applications, #presidential-election-of-2020, #social-media, #systrom-kevin, #tiktok-bytedance, #trump-donald-j, #united-states-politics-and-government


US Pushes Large Arms Sale to Taiwan, Including Jet Missiles

The administration is proposing the packages as President Trump’s strategists try to paint him as being tough on China despite soft actions earlier.

#arms-trade, #boeing-company, #china, #defense-and-military-forces, #international-relations, #lockheed-martin-corporation, #military-aircraft, #peoples-liberation-army-china, #taiwan, #trump-donald-j, #tsai-ing-wen, #united-states-international-relations, #united-states-politics-and-government, #xi-jinping


China, Seeking a Friend in Europe, Finds Rising Anger and Frustration

Beijing’s hopes of using Europe as a counterweight to the United States have faltered as country after country confronts China over trade, Hong Kong, human rights and other issues.

#china, #coronavirus-2019-ncov, #europe, #european-commission, #european-union, #international-trade-and-world-market, #political-prisoners, #politics-and-government, #united-states-international-relations, #wang-yi, #xi-jinping


Impending WeChat ban won’t actually ban users from WeChat, DOJ says

There's no ban on WeChat in the US right now, the DOJ says, which is true—but that's supposed to change, somehow, in the immediate future, and nobody knows how.

Enlarge / There’s no ban on WeChat in the US right now, the DOJ says, which is true—but that’s supposed to change, somehow, in the immediate future, and nobody knows how. (credit: Budrul Chukrut | SOPA Images | LightRocket | Getty Images)

Three days before a ban on the use of China-owned app WeChat in the United States is supposed to take effect, the Trump administration still hasn’t said what specifically is being banned—only that individuals will not be penalized for using the app, despite the alleged threat it presents to national security.

Secretary of Commerce Wilbur Ross does “not intend to take actions that would target persons or groups whose only connection with WeChat is their use or downloading of the app to convey personal or business information between users, or otherwise define the relevant transactions in such a way that would impose criminal or civil liability on such users,” attorneys for the Department of Justice wrote in a court filing (PDF).

Users of WeChat may find services “directly or indirectly impaired” by whatever measures the administration does end up imposing, the filing continued, but “use and downloading of the app for this limited purpose will not be a defined transaction.”

Read 7 remaining paragraphs | Comments

#bans, #china, #executive-orders, #keystone-cops, #policy, #wechat


TikTok rumors beg the question: Did Trump solve anything?

Over the past 24 hours, rumors picked up by Bloomberg, the Wall Street Journal and CNBC have put some boundaries on what a possible deal between Oracle and TikTok’s parent company ByteDance will look like.

In its current incarnation floating around the DC press corps, it appears that TikTok’s data on American users will be stored in Oracle’s cloud, with Oracle acting as a “trusted technology partner.” Oracle will have some sort of real-time source code verification duty, in which it will audit TikTok’s codebase to ensure that there aren’t “backdoors” that allow China to siphon data into its national security apparatus. ByteDance will create a new organization for its U.S. operations, which will have a board of directors approved by the U.S. government and will have a license agreement to access TikTok’s algorithms. One member of that board (at least) will come from the American national security community.

There remains a pretty yawning gap in these rumors over what the ownership of this new entity looks like, and precisely who is going to own what. Oracle is presumed to take a fairly large stake, with CNBC reporting this morning that it will get a 20% stake. Walmart apparently has broken away from its deal partner Microsoft, and is still pursuing some sort of deal engagement with the company, now with Oracle as its champion.

While President Trump has repeatedly said that a deal had to be reached by September 15, his executive order gave the parties until September 20 to hash out an agreement. Therefore, we expect a final deal to be approved — or denied outright — in the next two to three days.

Obviously, all terms are still under negotiation, and for all we know, McDonalds will end up buying the company (it’s been that kind of year).

Given what we know so far though, how did the Trump administration do in furthering its goals? The administration has repeatedly said that it wants to protect American users, particularly the young users who love TikTok, from the prying eyes of China. It also wanted to ensure that any protections would last into the future and couldn’t be changed retrospectively by, say, a more aggressive future policy implemented by China. And Trump has also said that the U.S. government should be paid for allowing the company to essentially continue to exist in the U.S. at all.

The latter point is the easiest one — U.S. government lawyers have said outright that the country can’t accept a payment for allowing a deal through, a point that Trump now appears to agree with.

So let’s head over to national security and privacy. Hosting American data on American soil helps with some jurisdictional issues of course. So-called data sovereignty laws have been popular in the European Union, China, India, Brazil and elsewhere as a means of ensuring that citizen data comports with the laws of those citizens’ countries. If the EU wants better privacy protections than America for instance, then it actually needs to “own” its own data to put its policies into place.

However, what has not been made clear is how “TikTok US” (or whatever the entity is called) will be able to take advantage of its parent company’s algorithms without actually handing American data over for processing.

The kinds of algorithms that run TikTok’s feed — like other social media feeds or Google’s search results — require real-time tuning of millions if not billions of parameters benchmarked against the quality of the user experience. For instance, users who linger on a particular video for longer than others, interact with it in specific ways, and share it are all data points that get fed into the “algorithm” to optimize exactly what each user sees in their own feeds.

This is an extraordinarily hard problem, and one that the word “algorithm” barely begins to describe. TikTok has to ingest billions of data points in real time from its app, needs to evaluate mullions of uploaded videos in real time, and needs to curate a custom stream of videos in real time for hundreds of millions of active users. That’s not an algorithm so much as a massively scaled computing system.

In the current deal framework, it sounds like “TikTok US” will supposedly “license” the underlying systems that power TikTok Global’s feeds. Yet, there has so far been zero clarity on how those algorithmic systems can tune their parameters without peering into U.S. data, or even how you can bifurcate such a system into a global half and a U.S.-only half.

One answer might be that the U.S.will just have an entirely independent algorithmic system that is tuned to the tastes of U.S. users and doesn’t take input from other global sources. That might work, although it’s an open question whether the smaller scale of TikTok US’ data will allow it to create as compelling a feed as today.

The larger issue is the pace of change in these systems. Updates to these algorithmic systems happen around the clock as engineers, product managers, data scientists and others determine ever more optimal and novel ways to improve the user experience. TikTok’s engineering team is expected to stay in China, meaning that any entity licensing those systems would have to absorb that constant avalanche of new code changes and integrate it into the U.S. codebase. Worse, those changes would have to be continuously evaluated by Oracle for backdoors — an incredibly hard engineering problem that remains by and large unsolved even if certain services offer a modicum of protection here.

Finally, building this infrastructure is not going to be easy. We haven’t heard much on how long TikTok would have to transition its systems, but it is hard to imagine that the company could rebuild its infrastructure on Oracle, add in real-time source code verification, completely separate its core machine learning algorithms into independent systems, and do all that while continuing to adapt its product to changing consumer whims in anything less than three years. One doesn’t just rebuild the code from scratch of a system used by hundreds of millions of people.

In all honesty, the rapid iterations required of a social media service will wither and die in the deal framework offered here. Which means that TikTok’s U.S. engineering efforts look all but doomed if this deal is approved.

Then there is this deal term of potentially adding an all U.S. government-approved board, with at least one director coming with a national security background. That experience isn’t unheard of in tech companies these days: Amazon just last week added former National Security Agency director Keith Alexander to its board, presumably due to the company’s expanding cloud services sales to the government.

Given that so many of the concerns expressed by the administration were around citizen privacy though, how exactly does this board structure protect privacy whatsoever? The company will essentially replace presumed Chinese surveillance with presumed American surveillance, and that’s a Pyrrhic victory in the end. We’ve heard next to nothing in these rumors about how the company can better protect user data in a more transparent fashion.

So the net-net right now is that the U.S. government isn’t going to get paid its tithe/bribe, the company’s engineering velocity is going to crater from bureaucracy, and its user data won’t have any more protections than what pretty much already exists with other social networks.

Maybe in the end, killing TikTok was the goal all along. Certainly some analysts in the DC national security community would like to see that happen. But at least from the seat over here, what a colossal failure of imagination and opportunity.

#bytedance, #china, #government, #ma, #oracle, #policy, #tiktok, #walmart


Hammer drops on hackers accused of targeting game and software makers

A large seal of a white, Classical Revival-style office building is flanked by flags.

Enlarge / The Department of Justice seal as seen during a press conference in December 2019. (credit: Samuel Corum | Getty Images)

For more than a decade, hackers working on behalf of the Chinese government have brazenly pursued advanced cyber intrusions on technology companies, with a particular focus on those that market software, such as CCleaner, role-playing games, and other types of games. On Wednesday, US authorities fired back, charging seven men allegedly backed by the Chinese government for carrying out a string of financially motivated hacks on more than 100 US and overseas organizations.

US prosecutors said the men targeted tech companies with the aim of stealing software-signing certificates, customer account data, and valuable business information, all with the tacit approval of the Chinese government. Working for front companies located in China, the defendants allegedly used the intrusions into game and software makers for money laundering, identity theft, wire and access device fraud, and to facilitate other criminal schemes, such as ransomware and cryptojacking schemes.

Legal protection

According to one of three indictments unsealed on Wednesday, defendant Jiang Lizhi boasted of his connections to China’s Ministry of State Security and claimed it provided him with legal protection “unless something very big happens.” Jiang’s business associate, Qian Chuan, allegedly spent the past 10 years supporting Chinese government projects, including development of a secure cleaning tool to wipe confidential data from digital media.

Read 13 remaining paragraphs | Comments

#apt41, #biz-it, #china, #game-makers, #hackers, #hacking, #policy, #software, #winnti


Trump Is Wrong about TikTok. China’s Plans Are Much More Sinister.

The West still doesn’t understand the scale of Beijing’s soft-power ambitions.

#5g-wireless-communications, #australia, #beijing-bytedance-technology-co-ltd, #blacklisting, #chiang-kai-shek, #china, #communist-party-of-china, #computers-and-the-internet, #confucius-institutes, #darwin-australia, #embargoes-and-sanctions, #espionage-and-intelligence-services, #huawei-technologies-co-ltd, #india, #indian-ocean, #kenya, #kiribati, #maldives, #mao-zedong, #military-bases-and-installations, #mobile-applications, #myanmar, #pakistan, #panama-canal-and-canal-zone, #propaganda, #solomon-islands, #sri-lanka, #the-art-of-war-book, #the-romance-of-the-three-kingdoms-book, #tiktok-bytedance, #united-states, #united-states-international-relations, #united-states-politics-and-government, #xi-jinping


Senate Democrats Present $350 Billion Strategy to Counter China

Democrats rolled out sprawling legislation that proposes substantial new funding over a decade in a bid to reinvest in the nation’s economy and challenge Beijing.

#china, #democratic-party, #menendez-robert, #schumer-charles-e, #science-and-technology, #senate, #united-states-international-relations, #united-states-politics-and-government


Blume Ventures’ Karthik Reddy on Indian startup ecosystem, geo-political tension with China and coronavirus

Despite the coronavirus outbreak, which has slowed down deal-making across the world, dozens of startups in India have raised considerable amounts in recent months. Unacademy, which raised $110 million in February, closed a new round of $150 million this month.

These large check sizes, and the frequency at which they are being bandied out, were almost unheard of in India just 10 years ago. The list of problems these local startups were solving then was also quite smaller back in the day.

Karthik Reddy has seen this change very closely.

He co-founded venture capital firm Blume Ventures, where he also serves as a partner, 10 years ago. Blume Ventures is the largest Indian venture capital firm. In a wide-ranging interview at Disrupt 2020, Reddy talked about the state of the startup ecosystem in India, some of the challenges it is confronting today and what lies ahead for the market.

“Fifteen years is what you should consider the active VC build-out in India. For the first five to seven years, we were kind of faking it till we make it. We sold the idea that we can replicate what the U.S. and China have done,” he said.

The breakout moment in India happened when low-cost Android smartphones flooded the market. A handful of startups with consumer-facing services such as Flipkart, Paytm and Zomato emerged to serve the first tens of millions of smartphone users in the country.

“The Hail Mary moment there was Reliance Jio’s arrival in the market,” he said. India’s richest man, Mukesh Ambani, entered the telecommunications market in the second half of 2016 with the world’s cheapest mobile tariff.

Moreover, for several months, Ambani simply did not charge Jio subscribers anything for access to 4G data. So India at large, once conscious about each megabyte it spent on the internet, suddenly started consuming gigabytes of content everyday. “It democratized data and smartphones at a scale that we have not seen in countries other than China,” said Reddy.

Karthik Reddy is the co-founder of Blume Ventures, the largest Indian venture capital firm

As hundreds of millions of users in India arrived on the internet, scores of startups in the country started to solve more complex problems: Bangalore-based startup Meesho today is helping millions of women sell products digitally; Classplus, a Blume Ventures-backed startup, has built a Shopify-like platform for teachers and coaching centres to serve students directly.

As India grew into the world’s second largest internet consumer, it has also attracted American and Chinese technology groups, all of which are looking for their next billion users. Several major investment firms, including Silver Lake, Alibaba Group, Tencent, GGV Capital, Tiger Global, General Atlantic, KKR, Vista, and Owl Ventures have also arrived and become aggressive in their investments in recent years.

But the geo-political tension between India and China have slightly complicated matters. In April this year, India amended its foreign direct investment policy to China to seek approval from New Delhi for their future deals in the country. Chinese investors have ploughed billions of dollars into the Indian startup ecosystem in recent years.

It’s a sensitive topic, given the involvement of the government, that most VCs in India are not comfortable addressing it even off the record. But Reddy weighed in.

“If not an arm or limb, it cuts off a finger or two for your choices. You are a little handicapped,” he said. “But there’s a caveat to that. It’s limited to certain segments of the market. I don’t think China and Hong Kong investors, even though they were very familiar with Chinese VC success story, were really interested in India’s deep tech and cross-border tech,” he said.

Today those areas account for more than a third of the robust ecosystem in India, Reddy argued. “If you look at the entire ecosystem collectively, there’s a single-digit influence of Chinese capital. […] If you ask me personally, 40% of my portfolio is not even remotely affected by it,” he said.

But several large consumer-facing Indian startups, such as Paytm, Zomato and Udaan, do have Chinese investors on their cap tables. Reddy said they would be impacted as uncertainty looms over when — and if — India would offer any relaxation to its current stand.

He said he is hopeful that the government would provide some distinction to VC-managed fund money that is not necessarily Chinese just because it’s run by someone who originated there.

Reddy also spoke about why he thinks early-stage startups, despite the proliferation of VC firms in India focusing on young firms, continue to receive less attention. We also spoke about how the coronavirus is impacting his portfolio startups and the industry at large and what advice he has for startup founders to navigate the turbulence times. You can watch this and much more in the interview below.

#alibaba-group, #asia, #blume-ventures, #china, #disrupt, #disrupt-2020, #india, #karthik-reddy, #startups, #techcrunch-disrupt, #unacademy, #venture-capital, #zomato


Justice Department says WeChat users won’t be penalized under Trump’s executive order

In a Wednesday filing in federal court, the United States government said that users who use or download WeChat “to convey personal or business information” will not be subject to penalties under President Donald Trump’s executive order banning transactions with the Tencent-owned messaging app.

Trump issued the executive order against WeChat on August 6, the same day he issued a similar one banning transactions with ByteDance, the parent company of TikTok, claiming national security concerns. Both orders caused confusion because they are set to go into effect 45 days after being issued, but said that Secretary of Commerce Wilbur Ross will not identify what transactions are covered until then.

With that deadline now looming at the end of this week, WeChat users in America are still uncertain about the app’s future. Though WeChat is the top messaging app by far in China, where it also serves as an essential conduit for payments and other services, the U.S. version of the app has relatively limited features. It is used by Chinese-Americans, and other members of the Chinese disapora in the U.S., to keep in touch with their family and other people in China. With other popular messaging apps, like Facebook Messenger and WhatsApp, banned in China, WeChat is often the most direct communication channel available to them.

The U.S. government’s filing (embedded below) was made as part of a request for a preliminary injunction against the executive order brought by the U.S. WeChat Users Alliance, a non-profit organization initiated by attorneys who want to preserve access to WeChat for users in the U.S. A hearing is scheduled for Thursday.

In it, attorneys from the Justice Department said the U.S. Commerce Department is continuing to review transactions and will clarify which ones are affected by Sept. 20, but “we can provide assurances that [Secretary Ross] does not intend to take actions that would target persons or groups whose only connection to WeChat is their use or downloading of the app to convey personal or business information between users, or otherwise define the relevant transaction in such a way that would impose criminal or civil liability on such users.”

But in a response (also embedded below), the U.S. WeChat Users Alliance said that the Department of Justice’s filing instead demonstrates why a preliminary injunction is necessary. “Having first failed to articulate any actual national security concerns, the administration’s latest ‘assurances’ that users can keep using WeChat, and exchange their personal and business information, only further illustrates the hollowness and pre-textual nature of the Defendants’ ‘national security rationales.’”

The U.S. WeChat Users Alliance filed for the injunction on August 21. In an open letter published on its site, it said a complete ban of WeChat “will severely affect the lives and the work of millions of people in the U.S. They will have a difficult time talking to family relatives and friends back in China. Countless people or businesses who use WeChat to develop and contact customers will also suffer significant economic losses.”

The group also believes that the executive order “violates many provisions of the U.S. Constitution,” and the Administrative Procedure Act.

#apps, #china, #department-of-justice, #messaging, #policy, #tc, #tencent, #u-s-government, #wechat


China-Backed Hackers Broke Into 100 Firms and Agencies, U.S. Says

In indictments against five Chinese nationals, the Justice Department described sophisticated attacks to hijack networks and extort universities, businesses and nonprofits.

#china, #computer-security, #computers-and-the-internet, #cyberattacks-and-hackers, #cyberwarfare-and-defense, #industrial-espionage, #justice-department, #malaysia, #united-states-politics-and-government


Her Husband Abused Her. But Getting a Divorce Was an Ordeal.

A graphic video of a husband beating his wife has shocked China, shedding light on the prevalence of domestic violence and the difficulties of obtaining a divorce.

#china, #divorce-separations-and-annulments, #domestic-violence, #henan-province-china, #womens-rights


China tops 110 million 5G users in less than a year

Over 110 million users in China have signed up for 5G plans, announced president of the China Academy for Information and Communications Technology (CAICT), a think tank under the telecoms watchdog Ministry of Industry and Information Technology, at an industry event on Wednesday.

That makes China the largest 5G market in terms of user size, the think tank president said. The milestone came in less than a year after China’s top carriers rolled out  5G plans for consumers, and just over a year after the authority began issuing 5G licenses for commercial use.

The number is still a small fraction of the overall subscription. In June, China’s three state-run carriers collectively commanded some 1.6 billion mobile subscribers (suggesting China’s 1.4 billion population owned over one mobile device per capita).

China’s 5G ambition is a multi-pronged effort among the government, network carriers, telecoms equipment makers, device makers, and software developers. Policymakers need to show consumers visible improvement on network speed, and as such the carriers have been aggressively setting up 5G base stations across the country — more than 460,000 towers by July.

China was adding an average of 15,000 new 5G base stations every week, said an official in July. The government has plans to raise that number to 600,000 by the end of 2020, covering all prefectural-level cities nationwide. A clear winner in China’s 5G push is Huawei, which makes both 5G devices and the infrastructure that undergirds the next-gen network.

In the meantime, Huawei, Oppo, Xiaomi and their rivals are rushing to launch 5G compatible handsets. China has sold over 93 million units of 5G mobile phones this year so far, according to recent data released by CAICT. 5G phones accounted for 60% of total shipments in August.

China’s rapid shift to 5G is also driving the need for new hardware parts like integrated circuits. The country produced over 100 billion units of ICs during the first half of 2020, representing a 16.4% year-over-year gain, said an industry official in July, adding that much of the demand came from 5G-related projects.

#5g, #asia, #china, #tc


Will Oracle Solve Trump’s TikTok Problem?

Forcing the unspooling of a complex global company is not as easy as yelling about the “China menace.”

#beijing-bytedance-technology-co-ltd, #china, #ellison-lawrence-j, #mergers-acquisitions-and-divestitures, #oracle-corporation, #propaganda, #social-media, #tiktok-bytedance, #trump-donald-j, #united-states-politics-and-government


Travel Warning for Hong Kong Could Worsen U.S.-China Relations

The measure is unlikely to have much of an immediate effect because of the city’s coronavirus restrictions, but it could worsen fraying U.S.-China ties.

#china, #hong-kong, #hong-kong-protests-2019, #politics-and-government, #state-department, #travel-warnings, #united-states, #united-states-international-relations


As U.N. Turns 75, the Celebration Is Muted by Calamity and Conflict

The organization created in the wake of one world war was aimed at preventing another. But a celebration of its accomplishments has been overshadowed by a pandemic and rising world tensions.

#china, #coronavirus-2019-ncov, #defense-and-military-forces, #general-assembly-un, #guterres-antonio, #international-relations, #trump-donald-j, #united-nations, #united-states, #war-crimes-genocide-and-crimes-against-humanity


America Is Going to Decapitate Huawei

The United States’ technological dominance gives it an immense power. But how long will that last?

#5g-wireless-communications, #cadence-design-systems-inc, #china, #computer-chips, #huawei-technologies-co-ltd, #nanotechnology, #regulation-and-deregulation-of-industry, #taiwan, #united-states-international-relations


TikTok’s Proposed Deal Seeks to Mollify U.S. and China

The Chinese-owned app designed a compromise to satisfy U.S. security concerns. The terms are now under review by the Trump administration.

#china, #computer-security, #computers-and-the-internet, #executive-orders-and-memorandums, #international-trade-and-world-market, #mergers-acquisitions-and-divestitures, #oracle-corporation, #social-media, #stocks-and-bonds, #tiktok-bytedance, #treasury-department, #united-states-international-relations, #united-states-politics-and-government


How China Brought Almost 200 Million Students Back

We’re also rounding up thought-provoking ideas about Covid-era education, and bringing you the latest local updates for K-12 and college.

#atlantic-the-magazine, #axios-media-inc, #boston-mass, #boston-college, #california, #california-state-university, #children-and-childhood, #china, #colleges-and-universities, #communist-party-of-china, #connecticut, #coronavirus-2019-ncov, #coronavirus-reopenings, #de-blasio-bill, #e-learning, #education, #education-k-12, #florida-state-university, #football-college, #georgia, #los-angeles-calif, #maine, #massachusetts, #michigan-state-university, #new-york-city, #oregon, #rochester-ny, #shutdowns-institutional, #university-of-kansas, #university-of-michigan, #university-of-texas-at-austin, #washington-state, #wuhan-china, #yglesias-matthew


TikTok Was a Wasted Opportunity

The TikTok battle was a chance to debate big questions about technology and government. We missed it.

#5g-wireless-communications, #china, #computers-and-the-internet, #oracle-corporation, #social-media, #tiktok-bytedance


Equity Monday: The TikTok mess, two funding rounds, and NVIDIA will buy ARM

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast where we unpack the numbers behind the headlines.

This is Equity Monday, our weekly kickoff that tracks the latest big news, chats about the coming week, digs into some recent funding rounds and mulls over a larger theme or narrative from the private markets. You can follow the show on Twitter here and myself here — and don’t forget to check out last Friday’s episode.

What a weekend behind us, and what a week ahead. Disrupt kicks off today, so the TechCrunch crew is busy as heck getting all the final touches put on. Snag a ticket here and we will see you soon.

On the podcast this morning:

Ok, that’s all we have time for today. See you at Disrupt in a few hours!

Equity drops every Monday at 7:00 a.m. PT and Thursday afternoon as fast as we can get it out, so subscribe to us on Apple PodcastsOvercastSpotify and all the casts.

#arm, #china, #gojek, #microsoft, #nvidia, #oracle, #tc, #tiktok


ByteDance’s Need for a TikTok-Oracle Deal: China is Slowing

ByteDance’s founder has long urged his employees to think beyond the world’s No. 2 economy, where growth is easing and competition is rising.

#artificial-intelligence, #beijing-china, #china, #computers-and-the-internet, #mobile-applications, #social-media, #tiktok-bytedance, #toutiao-chinese-news-platform, #united-states-international-relations, #venture-capital, #video-recordings-downloads-and-streaming, #zhang-yiming-1983


TikTok’s Sale Is More About Power Than Protecting Your Privacy

Forcing a sale of the app is a show of power, but it doesn’t really protect your privacy.

#china, #computer-security, #computers-and-the-internet, #mobile-applications, #politics-and-government, #privacy, #social-media, #tiktok-bytedance, #trump-donald-j, #united-states


Terry Branstad, Trump’s Ambassador to China, is Stepping Down

Terry Branstad, a former Republican governor of Iowa and early supporter of Mr. Trump’s candidacy, will leave his post as the top American diplomat in China.

#branstad-terry-e, #china, #pompeo-mike, #united-states-international-relations, #united-states-politics-and-government


When Good People Don’t Act, Evil Reigns

Stop thinking that the horrors of the world will simply work themselves out.

#china, #coronavirus-2019-ncov, #deaths-fatalities, #demonstrations-protests-and-riots, #institute-for-health-metrics-and-evaluation, #police-brutality-misconduct-and-shootings, #trump-donald-j, #united-states, #united-states-politics-and-government, #war-crimes-genocide-and-crimes-against-humanity


Europe Feels Squeeze as Tech Competition Heats Up Between U.S. and China

As the rapid pace of change mixes with national security issues, Europe’s role as a global regulator is increasingly tested — and may not be enough.

#amazon-com-inc, #apple-inc, #artificial-intelligence, #china, #computers-and-the-internet, #european-union, #facebook-inc, #facial-recognition-software, #google-inc, #privacy, #regulation-and-deregulation-of-industry, #social-media, #tiktok-bytedance, #united-states-international-relations


Families of Hong Kong Activists Arrested at Sea Plea for Access to Lawyers

A dozen activists are being held after trying to flee to Taiwan, detentions that echo fears of judicial tactics by mainland China that set off last year’s mass protests in Hong Kong.

#china, #hong-kong, #political-prisoners, #politics-and-government


DCM has already made nearly $1 billion off its $26 million bet on Bill.com

David Chao, the cofounder of the cross-border venture firm DCM, speaks English, Japanese, and Mandarin. But he also knows how to talk to founders.

It’s worth a lot. Consider that DCM should see more than $1 billion from the $26.4 million it invested across 14 years in the cloud-based business-to-business payments company Bill.com, starting with its A round. Indeed, by the time Bill.com went public last December, when its shares priced at $22 apiece, DCM’s stake — which was 16% sailing into the IPO — was worth a not-so-small fortune.

Since then Wall Street’s lust for both digital payments and subscription-based revenue models has driven Bill.com’s shares to roughly $90 each. Little wonder that in recent weeks, DCM has sold roughly 70 percent of its stake for nearly $900 million. (It still owns 30 percent of its position.)

We talked with Chao earlier today about Bill.com, on whose board he sits and whose founder, René Lacerte, is someone Chao backed previously. We also talked about another very lucrative stake DCM holds right now, about DCM’s newest fund, and about how Chao navigates between the U.S. and China as relations between the two countries worsen. Our conversation has been edited lightly for length and clarity.

TC: I’m seeing you owned about 33% of Bill.com after the first round. How did that initial check come to pass? Had you invested before in Lacerte?

DC: That’s right. Renee started [an online payroll] company called PayCycle and we’d backed him and it sold to Intuit [in 2009] and Renee made good money and we made money. And when he wanted to start this next thing, he said, ‘Look, I want to do something that’s a bigger outcome. I don’t want to sell the company along the way. I just want this time to do a big public company.’

TC: Why did he sell PayCycle if that was his ambition?

DC: It was largely because when you’re a first-time CEO and entrepreneur and a large company offers you the chance to make millions and millions of dollars, you’re a bit more tempted to sell the company. And it was a good price. For where the company was, it was a decent price.

Bill.com was a little bit different. We had good offers before going public. We even had an offer right before we went public.  But Renee said, ‘No, this time, I want to go all the way.’ And he fulfilled that promise he’d made to himself. It’s a 14-year success story.

TC: You’ve sold most of your stake in recent weeks for $900 million; how does that outcome compare with other recent exits for DCM? 

DC: We actually have another recent one that’s phenomenal. We invested in a company called Kuaishou in China. It’s the largest competitor to Bytedance’s TikTok in China. We’ve invested $49.3 million altogether and now that stake is worth $3.8 billion. The company is still private held, but we actually cashed out around 15% of our holdings. and with just that sale alone we’ve already [seen 10 times] that $30 million.

TC: How do you think about selling off your holdings, particularly once a company has gone public?

DC: It’s really case by case. In general, once a company goes public, we probably spend somewhere between 18 months to three years [unwinding our position]. We had two big IPOs in Japan last year. One company [had] a $1 billion market cap; the other was a $2 billion company. There are some [cases] that are 12 months and there are some [where we own some shares] for four or five years.

TC: What types of businesses are these newly public companies in Japan?

DC: They’re both B2B. One is pretty much the Bill.com of Japan. The other makes contact management software

TC: Isn’t DCM also an investor in Blued, the LGBTQ dating app that went public in the U.S. in July?

DC: Yes, our stake wasn’t  very big,  but we were probably the first major VC to jump in because it was controversial.

TC: I also saw that you closed a new $880 million early stage fund this summer.

DC: Yes, that’s right. It was largely driven by the fact that many of our funds have done well. We’re now on fund nine, but our fund seven is on paper today 9x, and even the fund that Bill.com is in, fund four, is now more than 3x. So is fund five. So we’re in a good spot.

TC: As a cross-border fund, what does the growing tension between the U.S and China mean for your team and how it operates?

DC: It’s not a huge impact. If we were currently investing in semiconductor companies, for example, I think it would be a pretty rough period, because [the U.S.] restricts all the money coming from any foreign sources. At least, you’d be under strong scrutiny. And if we invested in a semiconductor company in China, you might not be able to go public in the U.S.

But the kinds of deals that we do, which are largely B2B and B2C — more on the software and services side — they aren’t as impacted. I’d say 90% of our deals in China focus on the domestic market. And so it doesn’t really impact us as much.

I think some of the Western institutions putting money into the Chinese market — that might be decreasing, or at least they’re a little bit more on the sidelines, trying to figure out whether they should be continuing to invest in China. And maybe for Chinese companies, less companies will go public in the U.S., etcetera. But some of these companies can go public in Hong Kong.

TC: How you feel about U.S. administration’s policies?  Do you understand them? Are you frustrated by them?

DC: I think it requires patience, because what [is announced and] goes on the news, versus what is really implemented and how it truly affects the industry, there’s a huge gap.

#bill-com, #china, #cross-border, #david-chao, #dcm, #exit, #ipo, #kuaishou, #recent-funding, #startups, #tc, #venture-capital


How China Brought Nearly 200 Million Students Back to School

China says the reopening of classrooms proves that its top-down system is superior. To overwhelmed teachers and students stuck on campuses, its restrictions can feel like overkill.

#china, #communist-party-of-china, #coronavirus-2019-ncov, #coronavirus-reopenings, #education-k-12, #education-secondary, #politics-and-government


Elon Musk says Tesla will ‘one day’ produce ‘super efficient home HVAC’ with HEPA filtering

Elon Musk has previously touted the ‘Bioweapon Defense Mode’ boasted by Tesla’s vehicles, which are designed to provide excellent air quality inside the car even in the face of disastrous conditions without, thanks in part to high-efficiency HEPA air filtration. Now, Musk has said on Twitter that he hopes to one day provide similar air filtration along with home HVAC systems.

Tesla, while primarily an automaker, is also already in the business of home energy and power generation, thanks to its acquisition of SolarCity, its current production of solar roofing products, and its business building Tesla batteries for storage of power generated from green sources at home. While it hasn’t yet seemed to make any moves to enter into any other parts of home building or infrastructure, HVAC systems actually would be a logical extension of its business, since they represent a significant part of the overall energy consumption of a home, depending on its heating and cooling sources.

Boosting home HVAC efficiency would have the added benefit of making Tesla’s other home energy products more appealing to consumers, since it would presumably help make it easier to achieve true off-grid (or near off-grid) self-sufficiency.

As for the company’s HEPA filtration, despite the jokey name, Tesla actually takes ‘Bioweapon Defense Mode’ very seriously. In a blog post in 2016, it detailed what went into the system’s design, along with testing data to back up its claims of a HEPA filter that’s “ten times more efficient than standard automotive filters.” While Tesla doesn’t cited wildfires in that post, it does list “California freeways during rush hour, smelly marshes, cow pastures in the Central Valley of California, and major cities in China” in terms of challenges it wanted it to to be able to handle.

Many experts are predicting that the wildfires we’re currently seeing devastating large portions of the west coast of the U.S. will only get worse as environmental conditions continue to suffer the impact of climate change. Given that, and given Tesla’s larger business goals of offering a range of products that neutralize or reduce the ecological impact of its customers, more efficient and effective home HVAC products don’t seem that far outside its operational expertise.

#articles, #california, #china, #elon-musk, #greentech, #hardware, #health, #solar-city, #solarcity, #tc, #tesla, #tesla-model-s, #united-states, #west-coast


The Coronavirus Is Mutating, and That’s Fine (So Far)

SARS-CoV-2 has been slowly changing in small ways, without getting more dangerous.

#australia, #cell-journal, #china, #content-type-service, #coronavirus-2019-ncov, #evolution-biology, #hong-kong, #immune-system, #influenza, #italy, #mutation, #new-south-wales-australia, #rna-ribonucleic-acid, #rumors-and-misinformation, #sars-severe-acute-respiratory-syndrome, #vaccination-and-immunization, #victoria-australia, #viruses, #wuhan-china


China and India Pledge to Ease Tensions After Border Clashes

The foreign ministers of the two countries issued a five-point statement aimed at ending a simmering confrontation. A previous pledge was followed by the deadliest clash in decades.

#china, #himalayas, #india, #international-relations, #peoples-liberation-army-china, #wang-yi


From Asia to Africa, China Promotes Its Vaccines to Win Friends

With pledges of a coronavirus vaccine, China is on a charm offensive to repair strained diplomatic ties and bolster engagement with other countries.

#africa, #bangladesh, #china, #clinical-trials, #communist-party-of-china, #coronavirus-2019-ncov, #far-east-south-and-southeast-asia-and-pacific-areas, #politics-and-government, #vaccination-and-immunization


Trump says deadline for TikTok sale won’t be extended

The United States government will not extend the September 20 deadline for Beijing-based ByteDance to sell TikTok, President Donald Trump said on Thursday. This adds urgency to negotiations because TikTok may be banned in the United States if it can’t reach an agreement with a buyer.

“We’ll see what happens. It’ll either be closed up or they’ll sell it,” Trump said before boarding Air Force One at Joint Base Andrews. Some analysts had predicted that the deadline would be extended because of the sale’s complexity.

Trump issued an executive order last month claiming there is “credible evidence” that ByteDance “might take action that threatens to impair the national security of the United States.” ByteDance was already in negotiations with Microsoft for a sale. Several other large American tech companies have since reportedly entered into talks with popular video-sharing app–but potential new roadblocks to a deal have also emerged.

Despite TikTok’s larger user base and value as one of the most popular social media apps among Gen Z, there are currently several issues that may lower its attractiveness for buyers.

For example, the software code used in ByteDance’s apps, including TikTok, are developed by engineers and developers at its Beijing headquarters. This makes separating TikTok from ByteDance more complicated on a technical level. Another factor is an update China made two weeks ago to export control laws that cover artificial intelligence technologies. TikTok’s AI-based algorithms, which shows new content to users depending on their interests and browsing history, are valuable and a huge part of its success. After the export control policy update was issued by China’s Ministry of Commerce, ByteDance said it will “strictly follow” the new rules, but that might prevent ByteDance from including TikTok’s personalized recommendation and AI-based technology in a sale, making it a less attractive acquisition.

In addition to Microsoft, contenders for TikTok reportedly include other American tech heavyweights like Twitter, Google and Oracle. Walmart has even put itself forward as a buyer, in a potential partnership with Microsoft.

TikTok’s security is also under a magnifying glass in several other countries. For example, it was among a roster of Chinese apps banned in India  over “national security and defence” concerns,” and is currently being investigated by French data security watchdog CNIL.

TikTok has fought back against those claims. Last month, it sued the Trump administration, stating in an announcement on August 24 that it “we strongly disagree with the Administration’s position that TikTok is a national security threat.”

In its complaint, TikTok said it has taken “extraordinary measures to protect the privacy and security of TikTok’s user data” by storing data in the U.S. and Singapore, and creating barriers between TikTok’s U.S. user data and the data of other ByteDance products like Douyin.

Since launching in 2017, TikTok, ByteDance’s international version of Douyin, has become firmly entrenched in internet culture, especially among Gen Z. In the U.S. alone, TikTok says it has over 100 million users in the U.S. and employs about 1,500 people.

Even though several apps, including Instagram, are trying to position themselves as TikTok alternatives with similar short-form video sharing features, no frontrunner has emerged so far. In fact, a new report by analytics firm Sensor Tower said that in August, TikTok was the most downloaded non-gaming app worldwide, with more than 63.3 million installs. TikTok users are so committed to the app that at least one VPN provider, ExpressVPN, saw a spike in traffic after the U.S. government proposed a potential ban in July.

Some cybersecurity experts say that TikTok’s data collection practices are similar to other social media apps that depend on advertising revenue. But a major concern revolves around its ownership by a Chinese company that may be forced to capitulate to demands for data by the Chinese government. A Chinese cybersecurity law requires Chinese tech companies, like ByteDance, to comply with government’s requests for user data. ByteDance has said it would resist attempts by the Chinese government access TikTok’s user data

Security concerns about TikTok also increased after a Wall Street Journal analysis published in August found that TikTok went around an Android operating system feature designed to limit how much data, including unique identifiers called MAC addresses, that apps can collect from users. According to the WSJ, TikTok stopped collecting unique identifiers in November, but its investigation raised questions about TikTok’s commitment to protecting user privacy. In a statement to the WSJ, TikTok said “like our peers, we constantly update our app to keep up with evolving security challenges.”

It’s not just Republicans who are taking a stance against TikTok. In July, Joe Biden’s presidential campaign reportedly asked its staff to remove TikTok from their work and personal devices.

The U.S government’s scrutiny of TikTok began escalating last year when Sens. Charles Schumer (D-NY) and Tom Cotton (R-AR) asked Joseph Maguire, then the acting director of national intelligence, to assess if TikTok can be forced to turn over American users’ data to Chinese authorities.

#apps, #bytedance, #china, #policy, #president-donald-trump, #tc, #tiktok, #u-s-government, #united-states


Carbon Health to launch 100 pop-up COVID-19 testing clinics across the U.S.

Primary care health tech startup Carbon Health has added a new element to its “omnichannel” healthcare approach with the launch of a new pop-up clinic model that is already live in San Francisco, LA, Seattle, Brooklyn and Manhattan, with Detroit to follow soon – and that will be rolling out over the next weeks and months across a variety of major markets in the U.S., ultimately resulting in 100 new COVID-19 testing sites that will add testing capacity on the order of around an additional 100,000 patients per month across the country.

So far, Carbon Health has focused its COVID-19 efforts around its existing facilities in the Bay Area, and also around pop-up testing sites set up in and around San Francisco through collaboration with genomics startup Color, and municipal authorities. Now, Carbon Health CEO and co-founder Even Bali tells me in an interview that the company believes the time is right for it to take what it has learned and apply that on a more national scale, with a model that allows for flexible and rapid deployment. In fact, Bali says the they realized and began working towards this goal as early as March.

“We started working on COVID response as early as February, because we were seeing patients who are literally coming from Wuhan, China to our clinics,” Bali said. “We expected the pandemic to hit any time. And partially because of the failure of federal government control, we decided to do everything we can to be able to help out with certain things.”

That began with things that Carbon could do locally, more close to home in its existing footprint. But it was obvious early on to Bali and his team that there would be a need to scale efforts more broadly. To do that, Carbon was able to draw on its early experience.

“We have been doing on-site, we have been going to nursing homes, we have been working with companies to help them reopen,” he told me. “At this point, I think we’v