The political economy of Chinese internet companies: Financialization, concentration, and capitalization

Abstract

The rapid growth of the internet in China has been propelled by the Chinese government’s push to develop the country’s information infrastructure and its tight control over the internet. The most recent stage of internet development in China, however, has been driven by a three-way dynamic between the State, internet companies, and international finance capital. This relationship has yielded three internet giants—Baidu, Alibaba, and Tencent—that stand at the apex of the internet economy in China. They also rival their US counterparts like Google, Facebook, and Amazon, on several key measures. We examine annual reports and other financial documents to better understand these three companies’ character as ‘capitalist enterprises’ and the tight nexus that links them to international investment banks, venture capital funds, and other foreign investors. While these processes are now fundamentally shaping ‘the Chinese internet’, they have not yet been adequately explored in the scholarly literature, we argue.

East Asian pop music idol production and the emergence of data fandom in China

“…(2001)(2002)(2003)(2004)(2005), strategically allocating direct financial investment and establishing economic incentives to facilitate research and the building of digital infrastructures.Second, were policies of political re-regulation after China joined the World Trade Organization in 2001. These allowed for state managed capitalist competition and private enterprise, and reduced restrictions on both capital investment into China and the external operations of major internet companies, such as Baidu, Alibaba and Tencent, outside of China(Tse, 2015;Jia & Winseck, 2018).Unlike Korea, where entertainment companies had been signing and developing pop artists since the 1980s, the rapid growth of the digital economy in China led to platforms being set up that required content that was relatively scarce within the mainland recorded music industry. The commercial recording sector in China developed relatively slowly following the economic reform programme of 1978.…”

Going Public and Going Global: Chinese Internet Companies and Global Finance Networks

“…For example, Sina's spinoff Weibo is owned by Alibaba and Tencent owns 16.5 per cent of Cheetah Mobile. This reaffirms the concentration of power in the hands of a few Chinese internet companies, especially Baidu, Alibaba and Tencent (BAT) (Jia & Winseck, 2018;Xia & Fuchs, 2016). Australian financial group Macquarie Bank owns 16.7 per cent of Sohu and 5.5 per cent of Sina's shares respectively in 2016.…”

“…Nonetheless, critical media scholars have highlighted the converging characteristics between Chinese and US internet companies, where the integration of monopoly-finance capital and the internet represents the dominant tendency of the global capitalist system (Foster & McChesney, 2011). Concentration of market power in the hands of a few giants rings alarm bells both in the US (Foster & McChesney, 2011) and China (Xia & Fuchs, 2016;Jia & Winseck, 2018). Bingqing Xia and Christian Fuchs reveal the power wielded by the BAT (Baidu, Alibaba and Tencent) in sweeping up many start-up companies in China into their pockets in order to accumulate capital based on financial rather than productive accumulation, which further stimulates internet finance bubbles (Xia & Fuchs, 2016).…”

WeChat as infrastructure: the techno-nationalist shaping of Chinese digital platforms

“…To understand the success of WeChat Pay and its rise as an infrastructural standard, such payment features must be framed beyond the well-documented interplay between private companies and the state. They must be considered in the broad context of the rapidly growing Chinese digital economy, particularly the role of finance capital (Jia & Winseck, 2018). This context includes the entrepreneurial drive of individual users engaging in e-commerce, service provision, and innovation (Yu, 2017).…”