Digital Ventures has previously discussed China’s technology development. Today, we want our readers to see the big picture of China’s latest tech advancement, the so-called Tech Scene in China. It reflects factors behind China’s success in terms of innovation from large tech leaders to startups as well as the support from the Chinese government.
China Internet Industry, stepping closer to the USA
Undeniably, the USA still houses several giants in the internet industry which has been around for a long period of time. However, today, many Chinese tech giants are not far behind. This is observed from the world’s internet company ranking that compares the market capability. Here, we see 7 Chinese companies in the top 15. This is lead by Tencent and Alibaba, each with a value of over 4 trillion USD followed by Baidu, JD, Ctrip, and Weibo. Products and services from each company are a variety and outstanding ranging from content platforms, e-commerce, payment, social network, sharing economy, gaming and e-sport. Also, Deep Tech such as Blockchain, Big Data, and AI are ready to serve consumers’ future trends.
Tech companies are the heart of China’s digital economy
Tech companies in China have a very high total market value which accounts for 30% of the country’s GDP. Interestingly, tech companies in China only came into the business in 1998. Yet their growth rate is rather extreme when compared to traditional companies in China that have been established long ago.
Leaders in the Tech company sector is no other than Alibaba, Baidu, and Tencent. Aside from the complete service on the internet, all 3 companies are spearheads for China’s tech development.
- Baidu, an internet company who has shifted its strategy to develop AI. Products range from autonomous vehicles and AI operating system for users similar to that of Siri or Alexa. Moreover, the company internally highlights the need to nurture AI specialists by launching a short-term program which produces over 100,000 AI developers with computer science knowledge.
- Alibaba, an IT firm who is the leader of China’s e-commerce both online and offline. They offer online shopping and service booking platforms as well as loan services. Also, they own the payment platform via QR codes called Alipay. For the future, Alibaba has established a research center named DAMO (Academy for Discovery, Adventure, Momentum, and Outlook). This is a place for innovative research and development both for software and hardware with state-of-the-art technology, all of which, will become solutions for future consumer needs.
- Tencent, another tech giant, owner of WeChat and payment platform, WeChat Pay as well as an online content platform which is well-known both in China and countries around the world. This firm is handling the task from the Chinese government to develop AI in healthcare, the solution for the aging society.
These 3 giants are China’s significant spearheads in tech and innovation. Surely, we shall share more about them in our upcoming blogs.
China’s startups with strength comparable to world-leading players
Aside from the aforementioned tech giants, another sector worth spotlighting is the tech startup. They play a significant part in solidifying the tech industry in China. Factors and outcomes of China’s tech startup development are as follow:
- They fully make use of the economy of scale. An enormous population brings about a large market and abundant pool of labor such as graduates who are high-skilled workforces. At the same time, most of China’s population quickly embraces technology. Thus, development and experiment happen quickly and has a high potential for success.
- 1 in 3 of the world’s unicorn is from China. Not only does China house a large market, but startups have great potential in that it has received funding of billions USD to become unicorns. There are 262 unicorns which account for 1 in 3 of the world’s unicorn.
- Large VCs that are about to overtake USA’s. Not only for startups but China’s venture capital is also quite active. Today, Chinese VC has large funds that rank second in the world, following only the USA. Estimation suggests that the size of funds from Chinese VC may exceed the USA by 2020.
- Having the most incubator and makerspace in the world. Market size and funding may not be the sole factors for developing startups. Nurturing startups involves incubation coupled with other facilities. China highlights this issue and has collaborated with private sectors to launch over 3,000 incubator projects as well as 4,000 makerspaces for innovative research and development. Their dedication resulted in 14,000 new business registration per day. Moreover, in 2020, China plans to house 10,000 makerspaces which will lead to an increase of 3 million new jobs.
Tech development strategies with the “government” as host
The advancement in tech industries and businesses in China is not solely dependent on the private sector. Also, the government issues policies to support and drive the process. China has launched a mega plan called the “Science and Technology Innovation 2030” project. It aims to drive significant technologies of the future towards the country’s sustainable development in accordance with the UN’s Sustainable Development Goals (SDGs). China is emphasizing future techs such as Artificial Intelligence and Quantum Computing.
China is stepping up as leader of tech development which will surely bring about various changes that neighboring countries such as Thailand can hardly avoid. Therefore, learning and keeping up with China’s changes is crucial to how we plan to tackle the changes in the near future.
The DV blog regarding China’s tech development: