Asia Tech Review: 5 July 2022
I spent much of last month in the US, giving the newsletter an extended sojourn as public markets, private markets and the world of crypto melt in the downturn. But we are back this week with news of a journalist arrest in India, concerns around TikTok’s US user data, Netflix’s plan to revive its numbers, a future Southeast Asia unicorn and much more.
In between emails, you can keep up with news as it happens via the ATR Telegram channel here.
See you next time,
Stories in focus
Mohammed Zubair, a co-founder of Alt News—a digital publication that weeds out false information and fake news—was arrested for a tweet that was allegedly designed to “incite hatred” against “a particular religious community.” The post in question is thought to be a tweet highlighting controversial comments about the Prophet Muhammad from a former spokesperson of the ruling Bharatiya Janata Party (BJP), which became a global embarrassment from India. The detention of Zubair is vague and troubling.
TikTok parent ByteDance has tacitly admitted employees in China can access user data from the US and other countries. The company claims it is working to "fully safeguard user data and US national security interests" through a partnership with Oracle. It also denied the Chinese government has full data access. The responses come as US lawmakers again raise concern over access to data, and whether TikTok should be banned from the US.
The ride-hailing giant’s IPO was long-anticipated, at one point it seemed likely to pip Uber to reaching the public markets, which made its spectacular collapse at the hands of Chinese government intervention all the more dramatic. Bloomberg looks in detail at how the events unfolded behind the scenes, catching everyone off guard.
The New York Times threads the needle on how China is using technology-enabled surveillance to keep tabs on its massive population. The state’s use of technology has traditionally been over-emphasised since a lot of the technology is largely unproven and based on claims, however China has ploughed such investment and time into developing its surveillance system that the sheer potential is mind-blowing.
We’ve seen China try to build its own versions of technology necessities—look at its ongoing chip ambitions, for example, and now it is pushing hard on desktop operating systems.
“Kylinsoft, a subsidiary of state-owned China Electronics Corp, last week joined forces with more than 10 Chinese entities, including the National Industrial Information Security Development Research Centre, to set up an open-source code community. Named “openKylin”, it allows programmers to publish and share computer codes related to the Kylin operating system.”
Netflix plans to increase spending in India, despite overall spending reductions, with a focus on local films and series. On the product side, it also wants to explore mobile-only plans and lower priced options that can make it more compelling for a new demographic. A part of that will also see it explore partnership opportunities with operations, payment firms and others who can give it leverage into newer customer segments. Ironically, that’s a strategy many of the local streaming players had, only to be killed off by Netflix going global. Tech truly is cyclical.
Crisis at SenseTime—the AI and surveillance company—as shares fell by nearly half as some investors sold following the end of a six-month lockup period. The crash erased nearly $12B in market value link
Tencent and ByteDance are among the Chinese tech firms that have laid off thousands of employees in the name of cost-cutting link
A shocking report has shown that officials used China’s health code system to stop depositors from protesting over failing rural banks—it highlights the very real concern that some governments have used Covid and other apps to exert control link
China’s gadget manufacturers are getting into the car-making business. That could shake up the auto industry, global trade, and geopolitics…. link
China’s regulator proposed new rules to improve anti-monopoly governance—requirements include that companies will need to seek an antitrust review on M&A if one parties' global annual revenue is over 12B yuan ($1.79B) or two parties' domestic annual sales cross 800M yuan link
US-listed Full Truck Alliance and Kanzhun have resumed new user registrations in what is a sign that China’s cybersecurity probe into the businesses is nearly over link
Chinese tech giants including Tencent and Ant Group have signed a pact to stop the secondary trading of digital collectibles and "self-regulate" their activities in the market link
Byju’s reportedly laid off over 2,500 employees across its Byju’s, Whitehat Junior and Toppr services—a rare period of funk for a company that’s grown into the world’s largest edtech in the last 5 years or so link
Google’s latest investment in India is Progcap, a startups that gives working capital to small retailers—the investment is part of a $40M round that values the startup at $600M and Tiger Global is another investor link
Accounting giant Intuit will stop offering its QuickBooks Online products in India from January 2023 because, basically, it’s really hard to get customers to pay to use them link
You don’t often see Indian companies expanding overseas, Byju’s may be the best of the rare examples, but India’s Lenskart is buying a majority stake in Japan’s Owndays to create one of Asia’s biggest online retailers of eyewear. Reportedly the merger values 32-year Owndays at $400M. Lenskart reportedly raised $100M at a valuation of over $4B earlier this year link
Gaming startup MPL is planning to raise $10-$15M to finance a web3 gaming unit—it is reportedly talking to crypto VCs such as Polygon and Spartan Labs. A deal could value it as high as $250M link
India is giving VPN providers and cloud service operators an additional 3 months to comply with new rules that require they maintain names and addresses of their customers and their IP addresses link
Arzooo raised $70M to bring ‘best of e-commerce’ to physical stores in India—the round included Doordash founder Tony Xu link
Defi protocol MoHash raised $6M from Sequoia, Quona and others link
Battery swapping startup Battery Smart raised $25M led by Tiger Global, which has also backed India-based EV makers Ather Energy and Ola Electric link
Solv, a marketplace for small businesses, raised $40M led by Japan-headquartered SBI Holdings link
Revenue-based financing platform GetVantage raises $36M link
Ecommerce-focused logistics player Ecom Express, which was preparing for a listing before the markets turned choppy, is looking to raise $125-$150M in private funding link
Rewards and cashback service Shopback is looking like a prime IPO candidate (once the market is ready again) after it pulled in an $80M round to take its total funding to $230M—Asia Partners led the round but Shopback counts Temasek among its backers link (bonus: I wrote about Shopback for The Ken a couple of years ago, it’s an interesting company that is not only doing offline services but also expanding outwardly from Southeast Asia: link)
Logistics firm Deliveree raised $70M led by Gobi Partners and SPIL Ventures link
Indonesia-based consumer insights platform Populix raises US$7.7M in Series A funding link
Mapan, a financial services company once owned by Gojek, raised $15M to expand across Indonesia link
Japan’s biggest semiconductor makers from Toshiba to Sony are warning that the government’s push to revive its domestic chip industry is being threatened by a shortage of engineers link
LG Electronics has acquired AppleMango, a South Korean electric vehicle battery charger developer, as the race to produce everything related to EVs ramps up globally link
Car-sharing platform Socar is aiming for a $1.2B valuation in an August IPO link
Apple opened the gate for third-party payment options in South Korea—now it says developers who want to take advantage of the opportunity will need to submit new versions of apps and adhere to some guidelines link
South Korea, the world’s biggest producer of memory chips, saw its chip stockpiles increased by the most in more than four years, suggesting a slowdown in demand for memory chips used in electronics worldwide link
Samsung has purchased Germany-based display company Cynora for about $300M—the deal will see it gain technology for OLED screens link
Rest of Asia
How a schoolteacher became one of Nepal’s biggest YouTube stars link
Bangladesh B2B commerce startup ShopUp raised $65M from Peter Thiel’s Valar Ventures and Grab backer Flourish Ventures link
Taiwan's GlobalWafers to invest $5B in new silicon wafer plant in Texas link
North Korean hacking group Lazarus is said to be behind a $100M Horizon bridge hack link
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