Telecoms

Information war

How Big Data is bringing Chinese tech giants to blows

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Big Data has been identified as a key driver for Alibaba’s earnings growth and its boss Jack Ma says he is already sitting on a huge trove of valuable information. “Do you want to know which province in China boasts [the women with] the largest bra size? We have this data,” Ma crowed at a conference last month, without revealing an answer. “The smallest? Here in Zhejiang,” he did confirm.

Less tantalizing applications of customer information are seeing Chinese companies fighting one another for better insights about consumers. One outcome was the stand-off between Alibaba and logistics giant SF Express last month, when two of the key cogs in China’s e-commerce market stopped sharing information (see WiC374). And last week, a similar row was brewing between Tencent, the archrival of Alibaba, and China’s leading smartphone manufacturer Huawei.

The dispute, which was first reported by the Wall Street Journal, started when Huawei began collecting data from users of its newly released Honor Magic smartphone. As Huawei is also capturing information on text messages sent via Tencent’s WeChat service, Tencent contends that it is stealing data and violating the privacy of WeChat’s users.

Huawei denies any wrongdoing, insisting that it collects information from users who have given approvals through their phone’s settings. It also said that its Shenzhen neighbour has no monopoly on access to the information anyway. “All user data belongs to the user… it doesn’t belong to WeChat or Honor Magic,” Huawei told the Wall Street Journal.

Tencent has already filed a complaint to the Ministry of Industry and Information Technology, although the ministry has urged the duo to “come to a peaceful resolution” and protect the rights of consumers. (The State Postal Bureau coordinated the truce between SF Express and Alibaba’s logistics unit Cainiao last month.)

The central government’s inaction this time, China Business Journal suggests, is linked to a lack of adequate legislation in the rapidly changing mobile industry. “The collection of consumer information will be a conflict zone for more internet and tech firms as their business interests converge in the era of Big Data and artificial intelligence,” the newspaper says.

China Business Journal has also reported that Sina Weibo, an affiliate of Alibaba, has severed its services to Jinri Toutiao (also known as Today’s Headlines), a popular news aggregator valued at $11 billion (see WiC244 for our first mention of this fast-growing firm). The reason: Sina believes that Toutiao has been republishing content generated by its weibo users without permission.

Akin to Huawei’s defence against WeChat, Toutiao argues that it only republishes content from users who have agreed to its terms and conditions. “We believe that anything posted by users on weibo belongs to the users themselves,” Toutiao added.

For its own rehashing of news content from other websites such as MSN, Sohu and Netease, Toutiao then pointed out that Sina Weibo’s parent firm Sina has long been a serial offender itself.

Few were convinced by this argument, however. “Just because Sina did it doesn’t mean that Toutiao can do it. If Sina was wrong and Toutiao followed suit, both of them are wrong. But for the time being there are still no specific rules governing such behaviour on social media,” an intellectual property rights lawyer told ThePaper.cn.

Tencent has also launched a newsfeed and search function (see WiC367) and it is only a matter of time before China’s most valuable internet firm wrangles with other news providers such as Sina Weibo and Toutiao over user content.

With Tencent already battling Apple (see WiC364), it will be interesting to see how it handles its new confrontation with Huawei – especially given the Honor Magic looks set to become a popular handset.


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