UC has been sued and wechat service has been suspended. India has accelerated its decoupling from Chinas Internet companies

 UC has been sued and wechat service has been suspended. India has accelerated its decoupling from Chinas Internet companies

UC had to say goodbye to India because of its business failure and geopolitical impact.

Recently, Ma Yun was subpoenaed by the court for layoffs in UC India.

According to Reuters on July 26, a former UCWEB employee named Pama sued Alibaba, claiming that he was wrongly hired for opposing content censorship and false news on UC browser and ucnews. At the same time, Indias gurug district court, which accepted the case, summoned Alibaba, Ma Yun and other relevant individuals and operation subjects, requiring them to attend the court in person or through lawyers on July 29.

Source: unsplash

In response to this, Wang Shuai, chairman of Alis market public relations committee, said in the afternoon of July 26 that UC India had indeed received a notice and the company was processing according to the process. However, as to whether Ma Yun knew about this, Wang Shuai said that Ma Yun has retired and is difficult to find.

Do Ma Yun and Ali executives need to appear in court to participate in the trial of this case? Wang Lai, senior consultant and lawyer of Indias K & T Consulting Company, told Time Finance on July 27 that at present, there is no Ma Yun on the list of shareholders and directors of UCWEB in India. As a legal person, the company has the qualification of litigation subject. In the case that the litigation documents have not been published, there is no reason to sue Ma Yun, but Ma Yun can find an agent to appear in court.

India UCWEBs ownership structure is provided by Wang Lai

Although it is pointed out that the above-mentioned employee was dismissed during Ma Yuns tenure in Alibaba in 2017, Wang Lai pointed out that the employee is now filing a lawsuit, which should be based on the current time point. The defendant company UCWEB of India is a company registered in accordance with the company law of India in 2013, which will not affect Alibabas domestic general group. It is also a director / Executive Director or authorized other persons to participate in the lawsuit. If we have to trace through the layers of offshore relations, and finally to Alibaba group, it is normal to mention Ma Yun.

UC leaves India, Alibaba shrinks overseas content business

As a matter of fact, the UC incident is only two weeks after India announced the ban on 59 Chinese apps, including UC browser, tiktok and wechat.

On July 15, Alibabas UC browser, ucnews and vmate, a short video product, all informed the local staff that the team was about to be disbanded through the companys internal letter.

According to Reuters, there are less than 100 local employees directly employed by Ali, but more than 100 employees of Indian outsourcing companies are involved.

According to Google play data, among the 59 Chinese apps banned by India, ucnews has been ranked out of the 1000 downloads in India, while vamte ranks 102nd. When UC browser was launched in India in 2016, the number of downloads was once the first, and now it has dropped to 60.

UC browser has more than 430 million monthly active users worldwide, and more than 689 million downloads in India, with 130 million monthly active users, according to sensor tower, an application analysis company. More than 790000 news downloads were made in 2017, but most of them were downloaded twice.

The companys share of chrome in India, at 46.56% as of 2020, is far lower than that of Googles 46.56% as of 2020.

India mobile browser market share from June 2019 to June 2020 source: StatCounter

Perhaps due to the poor user data in recent years, before the announcement of the dismissal of UC India team, Ali announced that the content internationalization strategy would be fully contracted. According to a later report, ucnews announced in June this year that it would stop operation and the original team was merged into Ali health. At the same time, vmate reduced staff and tightened capital investment.

As a matter of fact, UC has a good international foundation, and Alibabas content outbound has always focused on UC products: UC browser, ucnews (news aggregation products), vmate (short video) and 9apps (application distribution).

As early as 2011, UC established its first overseas business unit, with its office located in Gurgaon, a satellite city of science and technology in India. In 2013, UC announced that its overseas users exceeded 500 million, among which India ranked first. In December of the same year, UC launched 9apps, an overseas app store.

In 2014, Alibaba made globalization the companys basic strategy, and acquired UC for us $5 billion in this year, which became the largest M & a event in the history of Chinese Internet at that time.

In June 2016, UC launched the news aggregation application ucnews in India. Nine months after its launch, the monthly live users exceeded 80 million. In September 2017, UC incubated a short video platform VMate, which was called India express Kwai. Two years later, vmate announced that it had nearly 50 million active users.

After 10 years of hard work, the number of UC users in India is not small, why choose to wave goodbye?

On July 27, Dong Zhen, an analyst at Analysys, said that the current international situation is an important reason for UC to shrink the Indian market.

An Internet investor who does not want to be named believes that geopolitics only acts as a catalyst. UCs adjustment is mainly due to the poor performance of its offshore business, and Ali has made strategic adjustments. In recent years, Alibaba has spent a lot of money on the sea content, but the number of users has not been converted into actual revenue, and the data is not good. The above investors said to time finance.

On the same day, Wei Fangdan, founder and CEO of Moby Dick, an Internet offshore platform, told time finance and economics that the main revenue of UC is advertising, but in emerging markets like India, the advertising value of users is not high.

In an earlier report, a number of people familiar with the adjustment were quoted as saying that Alibaba gave up ucnews and contracted vmate because of the poor performance of users and revenue data. UC browser, the most important overseas product of UC, is also unsatisfactory. The staff have been evacuated one after another, leaving only maintenance work.

The recent loss of Alibaba entertainment business, where UC is located, also supports the above view. According to Alibabas financial report in 2019, the operating loss of entertainment business in that year was 4.49 billion yuan (RMB, the same below), an increase of 16% compared with the same period of last year.

Its better to copy todays headlines than to copy Betta

In fact, in addition to UC, the content of domestic well-known Internet companies is not smooth.

Take Tencent video and iqiyi as examples. Last year, they began to use Southeast Asia as a springboard to enter overseas. In June last year, Tencent video wetv officially landed in Thailand; during the same period, iqiyi reached a cooperation with Astro Malaysia, which officially launched iqiyi brand channel.

But at present, the effect of the two platforms is not good.

According to the third party data statistics, AI has statistics that the number of the two major platforms still has more than 99% of the users coming from Chinese mainland by the end of last year. In contrast, the number of overseas paying members of Netflix in the same period was 97.71 million, accounting for more than 60%.

In Wei Fangdans view, tiktoks brilliance has covered up the struggle of many local enterprises to go abroad. Compared with tool products, content products are more difficult to go abroad.

When enterprises go overseas, to a large extent, they want to seize the huge number of users and traffic, and want to copy the successful mode in China. However, in such emerging markets, there is no mature sample reference. At the same time, content products should also consider the localization of local language, writing and even religion.

Dong Zhenze believes that in India, Southeast Asia and other overseas markets, most domestic Internet enterprises are in the initial stage of seizing user traffic. Manufacturers entering India and Southeast Asia attach great importance to the first mover advantage, and only after accumulating a certain amount of user traffic can they open up a payment mode in line with local conditions.

So, under the existing environment, which kind of content products of Chinese Internet enterprises are most likely to successfully dock overseas?

Wei Fangdan believes that live and social products are more likely to succeed. The effect of direct broadcast reward is better than the advertising revenue of news aggregation platform. At present, many overseas markets have a certain online payment basis. It is very convenient to make small payment in live broadcast, and it is easier to form impulse consumption in live broadcast. For news aggregation products, Yahoo and Google have already entered the local market, while the competition in the live broadcasting field is not fierce. Instead of copying a UC or todays headlines, it is better to copy a Betta and YY.

India accelerates decoupling from Chinese Internet companies

However, applications such as live video games, which had a promising future, are also facing a full retreat from the Indian market.

According to the economic times of India on July 27, the Indian government is drawing up a new blacklist of 275 Chinese applications. The Indian government may ban all or part of the list, people familiar with the matter said

The list of Chinas unlisted applications includes the Tencent game Jedi Survival International Edition (chicken eating), the byte beating independent music streaming media application Resso, the fast SnackVideo, the short video application of millet, Zili and the Alibaba groups global express (Tao Baoguo Kwai Edition).

In addition, apps from Meitu, byte skipping, perfectcorp, Sina, Netease and yoozoglobal are all on the list. Even Tencents application developed in supercell, a Finnish mobile game giant that has acquired a majority stake, is facing scrutiny.

Two days ago, on July 25, local time, wechat officially stopped its service to Indian users. The wechat registered with local mobile phone number in India could no longer be used, while the number in China was still normal.

Previously, the market generally speculated that the Indian government wanted to take advantage of the opportunity of suppressing Chinese applications to expand space for the development of domestic applications. However, Hu Xiaowen, an associate researcher at the Institute of Indian Studies at Yunnan University, believes that although it is difficult to make up for the gap in technology, innovation and service between Indian and Chinese applications in a short time, it is easy for Indians to find alternatives in mobile applications for life, entertainment and social networking.

Wang Lai noticed that Indians also rely heavily on Google software. In order to replace wechat, many business Indians have registered for nailing and flying books. In terms of entertainment, India also has some products with good use experience, but it is not clear whether there is any investment from Chinese enterprises.

Mr. Chen, who works for a well-known Chinese enterprise in India, also said in an interview with time finance on July 27 that he would wait and see the rise of local applications in India, but thought it was unlikely. He pointed out that Indian partners and Indian employees seldom use wechat at ordinary times. Most of them still use WhatsApp. American applications such as WhatsApp are more likely to fill the market gap.

This article is from Wang Fengzhi, editor in charge of times finance and economics_ NT2541