After going through today’s global news, you might find yourself wondering: what the hell is going on with China? As of late, the country has absolutely dominated headlines all over the world. If you don’t live in any China-owned territory, these headlines are very likely about the recent controversies surrounding Western companies.
Following the wave of pro-democracy protests in Hong Kong, China has started controlling disseminated information about the incidents. Of course, the controversy of Chinese censorship has always existed throughout modern history. However, this time around, the Chinese government is tapping its resources in the corporate world.
Western companies have also started censoring pro-Hong Kong sentiments among their representatives and official channels. Naturally, the general public is largely accusing these companies of selling out to the Chinese money-making regime.
Most of the corporate clout has eked out only this week. However, the controversy has existed as early as the first major Hong Kong protest. Let’s run through this tenuous history.
Come fly the hostile skies
Naturally, the first spark of Chinese censorship started in Hong Kong’s home turf. In August, the protests came to a huge head when protestors swarmed the Hong Kong International Airport, grounding several flights for several days. In the middle of all this, Hong Kong’s own Cathay Pacific found itself in a corporate nightmare. Who should the company (and its employees) support: China or Hong Kong?
Unsurprisingly, several Cathay Pacific employees have come out in support of the protests. The higher-ups were not happy. Spurred by Chinese intervention, the company’s managers have suspended employees involved in the protests.
Because of the relative infancy of the issue, Cathay Pacific’s troubles drowned in a sea of larger protests that followed the airport protest.
The tech world got its first taste of Chinese intervention through the popular short-video social media app, TikTok. Created by the Chinese developer ByteDance, TikTok is a lot more susceptible to government intervention. Case in point, the app has banned all anti-China content. The ban covers any mentions of Tiananmen Square and Tibet.
Strangely enough, TikTok was created for a more global audience, compared to the developer’s more Chinese-targeted Doujin app. Regardless, TikTok enforced the more stringent ruling across the entire platform. The ban was the world’s first taste of Chinese censorship. Unbeknownst to the world at the time, the situation was about to get worse.
Houston, we have a problem
This week, NBA started the larger party. Houston Rockets general manager Daryl Morey tweeted a pro-Hong Kong image. The image came with the statement, “Fight for Freedom. Stand with Hong Kong.” The obvious political opinion was shut down immediately after the tweet. NBA heads, including Rockets owner Tilman Fertitta and commissioner Adamn Silver, reiterated that individual opinions don’t represent the organization. Morey himself issued an apology soon after.
Unfortunately, the damage was done on both sides. Chinese companies have suspended cooperation with the NBA, especially with the Houston Rockets. Yao Ming’s own Chinese Basketball Association ceased its partnership with the Texan team. Tencent. Additionally, Tencent has ceased its livestreams of NBA matchups with the Rockets. Nike has also pulled its Houston Rockets merchandise from its Chinese stores.
On the Western end, the general public is calling for more integral responsibility on the part of the NBA. The NBA has always touted itself as an inclusive organization, drafting players from all over the world. The inclusivity, however, does not apply when profits are involved, according to Western protests.
Related to this, the ESPN has also stopped reporting on any of the NBA’s political opinions. Curiously, the broadcast company has recently televised a map of China. The map includes the 9-dash demarcation line that represents the country’s claims on the disputed South China Sea.
An Apple a day doesn’t keep China away
Concurrent with NBA’s woes, Apple has also found itself in the crossfire. Recently, the Chinese government has urged the company to pull offensive apps from the App Store in the region. The order includes HKmap.live and the Quartz news app. Apparently, these apps revealed critical police movements to protestors who had the app. Soon after, Apple gave in, joining the growing number of companies succumbing to Chinese pressure.
Apple pulled the apps. The company’s head honcho issued an embattling defense for his actions. In an internal memo, he said:
“However, over the past several days we received credible information, from the Hong Kong Cybersecurity and Technology Crime Bureau, as well as from users in Hong Kong, that the app was being used maliciously to target individual officers for violence and to victimise individuals and property where no police are present. This use put the app in violation of Hong Kong law.”
However, Hong Kong protestors have disputed his claims, reiterating the obvious political motivation behind the move. Like the NBA, Cook’s statement is remarkably non-confrontational, seeking to please both sides in the conversation.
Videogame company Blizzard is likewise facing immense backlash for similar decisions. Earlier this week, Blizzard censored and banned a professional Hearthstone player, Blitzchung, from its tournaments. The ban also strips him of prize money that he fairly won at a recent tournament. In that tourney, he went off on a pro-Hong Kong tirade during his victory speech. “Liberate Hong Kong, revolution of our age,” he declared. The speech was immediately cut short and removed from Blizzard’s official channels.
More than the NBA or Apple, Blizzard’s action sparked humungous global outrage. The fine went beyond simple censorship, stripping a worthy winner from rightful prizes. In defense, Blizzard invoked its right to penalize players for offending significant portions of the population.
Regardless, the public is already calling for a huge boycott against Blizzard’s products. Gamers have started unsubscribing and uninstalling popular games World of Warcraft and Overwatch. American lawmakers have asked for formal investigations against Blizzard’s actions. Pro-Hong Kong protestors have also started using a Chinese Overwatch character, Mei, as one of their protest icons. On the other hand, rivaling game companies have come out in support for Blitzchung.
The cost of luxury
Outside of the tech world, the lifestyle industry is also feeling the pressure. Apparel brands Gap and Zara have recently altered their websites. Previously, their websites included Taiwan and Hong Kong as individual countries, which China has requested to change.
People are also investigating whether Disney is censoring Winnie the Pooh in certain countries. According to a Reddit thread, Winnie the Pooh’s official site redirects to Disney’s official site in some countries. The internet has compared Winnie the Pooh’s appearance to President Xi Jinping, sparking a Chinese war against the cartoon character.
After this week, the corporate world is on notice. Who are they siding with? For some, the temptation of more profits is more important. For others, their integrity remains intact.
iPhone sales surge like never before despite raging pandemic
Apple’s daily revenue was $1 billion in Q2
Apple reported record revenues of US$ 89.6 billion for Q2 2021, an increase of 54 percent year over year. The company’s iPhone, iPad, and Mac lineups are producing strong growth.
The iPhone range, headlined by the iPhone 12 quartet, brought in US$ 48 billion in revenue alone between January and the end of March. iPhone revenue in the previous quarter was roughly US$ 29 billion, marking a rise of 66 percent. iPad sales came in at US$ 7.8 billion while Mac sales were US$ 9.1 billion.
Apple said it would increase its dividend by 7 percent to US$ 0.22 per share and authorized $90 billion in share buyback, which is significantly higher than last year’s US$ 50 billion.
The subscription services, which include the Apple One bundles, also hit an all-time high with US$ 16.9 billion in sales. These services include Apple Music, Apple TV+, Apple Arcade, and more. Wearables like AirPods and the Apple Watch had a record-setting quarter, too, drawing in US$ 7.8bn.
Apple CEO, Tim Cook, said on a conference call with analysts that all five of the best-selling smartphones in the U.S. during the quarter were iPhones. Though, Apple did not disclose official guidance for what it presumes in the quarter ending in June.
Apple sales grew at least 35 percent in every region, and while the majority was still in the Americas, China played a pivotal role too. The company did say that future growth could be hampered due to the acute shortage of semiconductors. Its new M1 chipset is class-leading and designed on the latest ARM-based architecture. This adds a layer of complexity that could slow down shipments.
Apple said it didn’t know how long the chip shortage would keep supply from meeting demand, but it’s sure that the demand far outweighs the supply.
Jeff Bezos says Amazon should treat its workers in a better way
His final letter to shareholders before stepping down as CEO
Amazon CEO Jeff Bezos used his final letter to Amazon shareholders to focus on employee well-being and its significant carbon footprint. The transition is closely watched by everyone as the legendary co-founder hands over the reigns to Andy Jassy.
The e-commerce giant has always been customer-centric, which was the prime reason it was able to garner trust and support. Now, Bezos thinks it time to put the company’s workforce on priority.
Jassy, the former head of Amazon Web Services, is taking over the top job so that Bezos can step back from day-to-day responsibilities. It’ll now be his responsibility to ensure Amazon continues its growth trajectory and sustains the pandemic-induced boom.
It’s currently hounded by regulators, labor unions, and activists around the world. There are multiple allegations — unfair treatment of warehouse workers, stifling competition, discouraging unionization, and shortchanged partners. It’s a long list, and the pressure keeps mounting as the company’s stock increases in value.
Bezos also talked about creating wealth for shareholders, the fact that climate change is real, the recent warehouse union vote in Bessemer, Alabama, US. Among his proposals are new staffing rotations to reduce physical stress at warehouses. He said that 40 percent of Amazon’s work-related injuries are musculoskeletal disorders (MSDs), such as strains and sprains from repetitive motions. These injuries tend to occur in the first six months of an employee’s tenure.
The founder also touted the company’s decision to increase Amazon’s minimum wage to US$ 15 per hour, a rate that labor groups have been advocating for the longest of time.
When it comes to workers who can’t consistently meet the company’s expectations, he says Amazon provides coaching to them, with 82 percent of it being “positive.” He also added that less than 2.6 percent of the staff was fired for not meeting the job expectations.
Amazon is also trying to cut down its carbon emissions and has pledged to have 100,000 electric delivery vans by 2030. Bezos has personally committed US$ 10 billion in grants for climate-oriented companies and organizations.
Why is Amazon starting a $250 million venture fund in India?
Aims to bring 1 million offline stores online by 2025
Amazon has announced a US$ 250 million venture fund called Amazon Smbhav Venture Fund that’ll invest in small and medium-sized businesses. The goal is to boost India’s export by using technology and the marketplace’s reach.
Amazon Smbhav will be focusing on the digitization of small businesses, agri-tech innovations to raise farmer productivity, and health tech for quality universal healthcare. The fund was announced at Amazon India’s annual Smbhav Summit.
It intends to tap offline sellers and professionals via the fund and on onboarding a million shops by 2025. Another initiative is “Spotlight NorthEast,” which will bring 50,000 artisans, weavers, and small businesses online from India’s North-Eastern states. The region is known for its local produce like honey, tea, and spices.
The announcement came at a fireside chat at the summit between Andy Jassy, incoming CEO of Amazon and Amit Agarwal, Global Senior VP and Country Head, Amazon India. They also revealed the first bet Amazon was making through the new fund — invoice discounting platform M1xchange, in which it has led a $10 million investment.
Amazon said it created close to 300,000 jobs since January 2020 and one million in total. It also boasted of having almost 70,000 sellers, exporting Indian goods to other markets totaling US$ 3 billion in sales.
The timing of Amazon India’s announcement is key because the e-commerce companies have been barred from delivering in the state of Maharashtra amid a Coronavirus-led curfew. While the restrictions are regional, businesses are unable to get necessary and basic supplies. In a work-from-home world, getting an emergency mice/keyboard or mattress should be easy via digitization, but there are antitrust concerns.
Due to a lockdown, offline sellers cannot operate and thus, don’t want online businesses to eat their share. The Narendra Modi-led government has historically sided with the offline traders since they constitute a majority of India’s market. The offline market is still the king, and the gap between the two is very substantial.
If online players operate exclusively for too long, they’ll start gobbling up market share gradually, killing the smaller businesses. While the aim is to maintain a level-playing field, the current rules aren’t helping anybody at the end of the day. The region also fails to collect indirect taxes over the possible transactions, leading to a cash crunch while the pandemic rages.
The FDI (Foreign Direct Investment) rules for the retail market were changed in 2019, meaning Amazon India could no longer directly sell its products. It had to act like a marketplace to maintain healthy competition since 100 percent FDI is allowed in e-commerce as a tech platform, but not as a retailer.
Thanks to the fund, Amazon can show its commitment to India and its initiatives to encourage online trade. India’s new farm laws also make it easier for private companies to invest in agriculture or partner with farmers for contracts.
Amazon had announced an investment of US$1 billion in January 2020 and its purpose was also the same — digitizing India’s small and medium businesses. Founder Jeff Bezos had said back then, “We are doing this now because it is working. And when something works you should double down on it.”
For now, the concerns of a monopoly are diminished because Amazon is going up against India’s homegrown Flipkart, which Walmart now backs. Reliance is also eyeing this segment and has already kicked off a hyperlocal service called JioMart. Lastly, many other retailers like Dmart, Tata CliQ + Bigbasket, and Grofers are available.
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