We’re getting a glimpse of where future priorities may lie for smartphone makers ZTE (HKEx: 763; Shenzhen: 000063) and TCL Communications (HKEx: 2618; Shenzhen: 000100), with the former hinting at a move into wearable devices and the latter placing big bets on China’s homegrown 4G technology called TD-LTE. ZTE isn’t exactly known for setting new market trends, but I would certainly like its decision to test its luck in wearable devices like wrist watches and glasses sooner rather than later. Meantime, TCL’s TD-LTE gambit looks like a 50-50 bet to me, as this notoriously boom-bust company tries to find a sustainable formula for success. Read Full Post…
In a move that was long overdue, Yum Brands (NYSE: YUM) is taking the bold step of relaunching its KFC brand in China in a bid to reverse sinking sales as bird flu season heats up. Yum might like to blame its recent woes for KFC in China on a bird flu scare last year, or on a minor food safety scandal that briefly tarnished its image. But the reality is that the brand is showing signs of age, and really is in need of this kind of a major overhaul. Read Full Post…
News that high-end hotel operator Hyatt (NYSE: H) is launching 2 more brands in China is drawing attention to the market’s growing saturation, boding poorly for all operators as the nation’s economy slows. Hyatt and most of the other big western brands don’t disclose separate operating figures for China, but leading budget brands Home Inns (Nasdaq: HMIN) and China Lodging (Nasdaq: HTHT) act as good indicators for the market. And their latest quarterly results don’t paint a very rosy picture for the industry in the year ahead. Read Full Post…
The issue of corkage fees has been popping in and out of the headlines these past few months, spotlighting a practice that many Chinese consumers feel is unfair even though it’s quite common in the west. The issue is quite straightforward, with restaurants charging an extra fee to customers who drink their own wine or other beverage with their meal. Such fees are often quite high, and are meant to encourage people to purchase drinks from the menu. Read Full Post…
The number 1,000 took on new significance in the blogosphere this past week, with tech titans Lenovo (HKEx: 992), Huawei and Xiaomi in a sudden new rush to chop prices for some of their newest products to under 1,000 yuan. The number translates to roughly $160, and is certainly not a bad price for the relatively high quality smartphones and tablet PCs that are suddenly being sold by the trio at that price and even less.
Meantime, tech executives were also paying tribute on their microblogs to Pat McGovern, the billionaire founder of the IDG media empire that was one of earliest venture capital investors to realize the potential of China’s Internet. McGovern, who died last Wednesday, leaves behind an empire that helped to fund some of China’s most recognizable Internet names, including sector leaders Tencent (HKEx: 700), Baidu (Nasdaq: BIDU), Ctrip (Nasdaq: CTRP) and SouFun (NYSE: SFUN), and many others. Read Full Post…
Retail village to debut alongside Shanghai Disneyland
An amusing rivalry between 2 US entertainment giants is rapidly shaping up in Shanghai, with developers of the new Disneyland (NYSE: DIS) resort announcing a major new retail development just days after DreamWorks Animation (NYSE: DWA) broke ground on its own massive entertainment complex in the city. The close timing of these 2 announcements may be partly coincidental, but the rivalry certainly isn’t. Hollywood followers will know that DreamWorks Animation chief Jeffrey Katzenberg was formerly the head of Disney’s famous animation division, and only left the company after a famous fall-out with former Disney chief Michael Eisner. Read Full Post…
The growing feud between banks and China’s biggest Internet firms has taken a major new turn, with word that leading lender ICBC (HKEx: 1398) may be preparing to formally sever ties with Alibaba’s Alipay electronic payments platform. The move would be clearly aimed at Alibaba’s wildly popular Yu’ebao service, which lets users put excess funds from their Alipay accounts into a product that functions much like a traditional bank savings account but offers much higher interest rates. Of course the next big question is whether other big banks will follow ICBC’s lead, and I suspect the answer is that many will indeed do so. Read Full Post…
Nearly all of the Chinese companies to list in New York during the current IPO boom have come from the tech sector, but reports of a new candidate that combines tech and finance looks like an interesting one to watch. The company, China Risk Finance, operates a peer-to-peer (P2P) loan platform, and is reportedly talking to investment banks about a potential New York listing later this year. (Chinese article) That could provide investors with an interesting and potentially exciting chance to buy into China’s small but quickly growing private financial services sector. Read Full Post…
China achieved an important milestone in its trade relations with the west last week when it settled 2 disputes with the European Union through negotiations, a less familiar tactic that produced a similar breakthrough deal last year. Both sides should be commended for this new approach, which not only avoids damaging trade wars but also helps to build a friendlier trade relationship based on mutual trust. Read Full Post…
US probe of JPMorgan claims victim in top official
The recent series of foreign government probes into their companies’ China business practices has claimed its first major victim, with word that the local investment banking chief of JPMorgan (NYSE: JPM) will retire from the company. There’s no direct evidence that the departure of longtime JPMorgan executive Fang Fang is related to the ongoing US probe against his company’s China hiring practices. But of course everyone is speculating that’s the case. The development looks like a positive one, as it sends a message that foreign companies intend to change the way they do business in China, and I expect we could see some other similar executive shuffles in the months ahead. Read Full Post…
I generally try to avoid taking sides in political disputes like the one involving US accusations that Chinese telecoms equipment from Huawei could pose a national security threat. But in the case of the latest revelations about US government spying on Huawei, I do think that Washington should at least discuss the results of its efforts to find evidence of a covert relationship between Huawei and the Chinese military. At the same time, I find Beijing’s condemnation of the snooping a bit insincere, as I’m quite sure that China and most other nations also engage in similar electronic spying. (English article) Read Full Post…
