Bottom line: Ericsson’s new tie-up with Inspur looks like a savvy move to gain a foothold in the nation’s fast-growing market to supply infrastructure to power Internet-related products and services.
Ericsson ties up with Inspur
Chinese IT services firm Inspur has just scored a major new partnership, with word that it’s forming a new tie-up to offer cloud and other Internet-based services with global telecoms equipment leader Ericsson. (Stockholm: ERICb). The new tie-up adds to a growing stable of similar alliances between Inspur and big-name foreign partners, following previous tie-ups with IBM (NYSE: IBM) and Cisco (Nasdaq: CSCO).
We should begin by pointing out that this kind of tie-up isn’t that uncommon for big foreign high-tech names, since Beijing often prefers that such companies form joint ventures for doing business in the vast Chinese market. That drive for tie-ups has accelerated over the last year, following Beijing’s roll-out of a new national security law that requires foreign high-tech product makers to work with Chinese partners when selling to the government or big state-owned companies. Read Full Post…
The following press releases and news reports about China companies were carried on July 14. To view a full article or story, click on the link next to the headline.
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Singapore’s GIC Buys 5 Pct of China Telecom’s (HKEx: 728) H-Shares (HKEx announcement)
Inspur, Ericsson (Stockholm: ERICb) Form Tie-Up in Cloud, Internet of Things (Chinese article)
Yum (NYSE: YUM) Shares Rise After CEO Signals China Momentum (English article)
Wanda to Bring First International Soccer Tournament to China (company announcement)
Tishman Teams With Lenovo (HKEx: 992) on South China Real Estate Development (English article)
Bottom line: Seagate’s new partnership with Sugon is the latest tie-up designed to give a major western hardware maker continued access to China’s IT services market, even as such partnerships sharply raise the risk of IP theft.
Seagate in new China tie-up
The steady stream of US tech firms bowing to Beijing’s tough new rules for doing business in China has just gained a new member, with word that data storage specialist Seagate (Nasdaq: STX) has just formed a new local joint venture. This particular tie-up comes just a half year after Seagate’s new partner, a company called Sugon (Shanghai: 603019), formed another similar cloud computing partnership with VMWare (Nasdaq: VMW), a unit of data storage giant EMC (NYSE: EMC).
The new Seagate alliance and slightly older VMWare venture come as most major US high-tech hardware makers, including the likes of IBM (NYSE: IBM), Hewlett Packard Enterprise (NYSE: HPE) and Cisco (Nasdaq: CSCO), have all formed similar tie-ups in a new love affair with Beijing. Of course I’m being slightly facetious in calling it a love affair, since these companies really didn’t have any choice in the matter. Read Full Post…
Bottom line: VMWare’s new China joint venture is the latest such tie-up for a major western tech firm to ease Beijing’s national security concerns, and could prompt the US to implement tougher restrictions on technology transfers to China.
VMWare in China cloud joint venture
EMC (NYSE: EMC) and its acquirer Dell are jumping on a high-tech train that goes directly to Beijing, with word that EMC-controlled VMWare (NYSE: VMW) has become the latest IT firm to set up a joint venture with a Chinese partner. The trio of high-tech giants join a growing number of other leading US tech firms to form similar ventures, with Hewlett Packard (NYSE: HPQ), IBM (NYSE: IBM) and Cisco (Nasdaq: CSCO) all forming similar tie-ups over the past year.
The rush to form such alliances comes as China rolls out a new national security law that could otherwise limit the big multinationals’ ability to sell their products and services to the Chinese government and big state-owned enterprises. But at the same time, a new New York Times report is pointing out that many of the Chinese firms in these new tie-ups also have links to China’s defense establishment, potentially setting the stage for a showdown between Washington and Beijing over national security. Read Full Post…
Bottom line: Cisco’s new joint venture will mostly resell its networking equipment into China, and is unlikely to ease Beijing’s worries that its products could be used by Washington for cyber spying.
Cisco calls on China with new JV
Networking equipment giant Cisco (NYSE: CSCO) has become the latest global tech firm to capitulate to China’s national security paranoia, announcing the formation of a new joint venture with a local partner. The tie-up with Inspur Group is just the latest in a recent string of new China-based partnerships involving big western tech firms. Those companies, whose ranks also include IBM (NYSE: IBM) and Hewlett-Packard (NYSE: HPQ), fear that without such well-connected local partners, they could get locked out of the lucrative IT services market under tough restrictions imposed by a new Chinese national security law.
Announcement of the new joint venture with Inspur marks a major shift for Cisco, which up until now has preferred to do its business in China by itself rather than with a local partner. Cisco’s earlier go-it-alone posture has already come with a high cost it in a country where Beijing prefers to see big foreign tech names transfer technology to local partners. Thus this latest partnership should perhaps help to ease some of that pressure, even though it could ultimately put some of Cisco’s intellectual property at risk. Read Full Post…
The following press releases and media reports about Chinese companies were carried on September 24. To view a full article or story, click on the link next to the headline.
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Alibaba’s (NYSE: BABA) Tmall to Split Headquarters Between Hangzhou, Beijing (Chinese article)
Cisco (Nasdaq: CSCO) in $100 Mln JV with China’s Inspur Group (English article)
Apple (Nasdaq: AAPL) Hack Exposes Flaws in Building Apps in China (English article)
ReneSola (NYSE: SOL) Announces $20 Mln Share Repurchase Program (PRNewswire)
Tencent’s (HKEx: 700) Billionaire Founder Sells $414 Mln in Shares (English article)
The following press releases and media reports about Chinese companies were carried on October 17. To view a full article or story, click on the link next to the headline.
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Ant Financial Set Up With Alibaba Assets Alipay, Yu’ebao And Others (Chinese article)
Spring Airlines To Become First Public Low-Cost Carrier With IPO By Year End (Chinese article)
Internet Giants’ Brawl Ends With Qihoo (NYSE:QIHU) Final Loss To Tencent (English article)
McDonald’s (NYSE: MCD) Hits Snag In China Expansion With Franchisee Dispute (Chinese article)
After months of hostile exchanges, accusations and negative publicity, the tone in a series of disputes between Chinese and foreign companies and governments abruptly shifted late last week with new signs of conciliation from both the foreign companies and Chinese government. One case involved leading global smartphone chip maker Qualcomm (Nasdaq: QCOM) , which is being probed by Beijing for anti-competitive behavior. The other involved computing giant IBM (NYSE: IBM), whose hardware could soon be shunned by many state-owned banks after Beijing warned of national security concerns earlier this year. Read Full Post…
The following press releases and media reports about Chinese companies were carried on August 23-25. To view a full article or story, click on the link next to the headline.
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Regulator Says Qualcomm (Nasdaq: QCOM) Seeks To End Anti-Trust Probe (English article)
US Game Designer Ouya Scores Xiaomi Partnership To Take Games To China (English article)
