Alibaba

[Wildreamz]

As long as a business contributes value to society, stays relevant to society changing needs, I thought there is nothing to fear in respect of China government recent actions.

And contributing value to society should have been an important (if not the most important) criteria for any long-term value investment.

100% agreed. The most durable business has to be pro-stakeholders. I think if one watched a couple interviews of Daniel Zhang, you'd agree that he is on the same page.

[Wildreamz]

Also one interesting observation, some of the fastest growing, Chinese tech companies, seems to also be the most manipulative.

Tencent (mobile games: microtransactions, energy systems, loot-boxes, pay-to-win etc.).
Futu (gamification of investing, promoting speculation),
ByteDance (addictive TikTok videos, cheap dopamine hits).
Didi and Meituan (exploitative pricing structure for merchants and deliverymen)
Chinese EduTech companies (exploiting Chinese parents kiasu mentality)

Alibaba seems like the lesser of the offenders. But maybe because I'm biased. haha

(vested in $baba, small)

[CY09]

Ant financial was the one in alibaba's conglomerate that was the naughty child. The rest of its business in cloud computing and e commerce are the mainstream and unlikely to have broken rules although there have been some unhappiness over the way it forces sellers to stick to its seller platform.

Ele might be another, but i am unsure of the effects of giving more benefits to delivery riders (though a small market share but definitely with this set of regulations likely will become a loss making segment). However, all this will be covered up by the vastly improving cloud segment

[Wildreamz]

https://www.msn.com/en-xl/money/other/te...uxbndlbing

"Temasek's 13F filing on Monday listed investments in at least 13 Chinese companies. Among the biggest bets, the wealth fund trimmed its stake in Alibaba Group Holding, the owner of this newspaper, for a second straight quarter."

Either Temasek thinks Ali growth has slowed or there r better opportunities.

Temasek Bet on China Tech Firms Just Before Share Plunge

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yikes

[Wildreamz]

Ant financial was the one in alibaba's conglomerate that was the naughty child. The rest of its business in cloud computing and e commerce are the mainstream and unlikely to have broken rules although there have been some unhappiness over the way it forces sellers to stick to its seller platform.

Ele might be another, but i am unsure of the effects of giving more benefits to delivery riders (though a small market share but definitely with this set of regulations likely will become a loss making segment). However, all this will be covered up by the vastly improving cloud segment

Even Ant Financial, I'd say is mainly providing fundamental financial infrastructure to the Chinese economy (WeChat Pay too). The fear here is Ant Financial becoming too important, too powerful, and challenge traditional State-owned banks (provide higher rates deposits than banks for consumers and SMEs etc.), increasing the risk in the financial system outside of CCP control (although I disagree with the policy that any financial products, not directly controlled by state-owned entities should be banned completely).

The interesting thing is, when it's IPO was blocked, Jack Ma even offered the the Chinese government "You can take any of the platforms Ant has, as long as the country needs it.", yet unable to salvage the relationship.

[Wildreamz]

I wonder if Chinese Government will do anything at all to stop capital flight.

Even their few allies/foreign investors left (e.g. Temasek) are feeling the burn, and might reconsider their relationship (at least, having financial exposure to China).

[Wildreamz]

中央财经委会议：合理调节过高收入，鼓励高收入人群和企业更多回报社会

https://finance.sina.com.cn/china/2021-0...5104.shtml

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Beijing reveals its next target for regulation: ‘excessive’ incomes

https://fortune.com/2021/08/18/china-inc...ty-wealth/

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You can implement policies that discourage excessive executive pay (e.g. progressive income tax). But what would they do about people that got rich through owning and accumulating capital assets?

[Wildreamz]

Since politics is the number 1 factor right now for investing in Chinese companies. I think it makes sense to revisit the original Jack Ma speech that kick-started this current regulatory environment:



English translation and transcript: https://www.theasset.com/viewpoint/42159...-mentality
Original Mandarin Transcript: https://sfl.global/news_post/mayunshangh...ushanjian/

[Choon]

Ant financial was the one in alibaba's conglomerate that was the naughty child. The rest of its business in cloud computing and e commerce are the mainstream and unlikely to have broken rules although there have been some unhappiness over the way it forces sellers to stick to its seller platform.

Ele might be another, but i am unsure of the effects of giving more benefits to delivery riders (though a small market share but definitely with this set of regulations likely will become a loss making segment). However, all this will be covered up by the vastly improving cloud segment

I am trying to read out more about Alibaba cloud. 

Main question I am trying to answer is if Alibaba has the inventive culture/ability to research and develop hard-scientific knowledge, so that it can come up with industry leading cloud products. Or is it less a inventor, more a follower? 

I feel that the ability to develop hard-scientific knowledge will be a most key competitive advantage in the battle between tech giants. While it is good that the Chinese market would buy cloud services from Chinese providers due to national security or patriotism reasons, it would be great if they choose to do it because Aliyun is a great product.

My scant knowledge of Alicloud is gathered from the YouTube videos on 王坚
https://www.youtube.com/watch?v=NmYnncPerPg
https://www.youtube.com/watch?v=2l5KoUQj4HQ

An interesting aspect is that when he was developing Aliyun, 80% of his team quit. They were more interested to join other departments of Alibaba. This contrasts with AWS. In the book Amazon Unbound, it was recounted that AWS was regarded as the elite department in Amazon.

Also from the book Amazon Unbound, AWS acquired or try to acquire a chip company to secure high-tech chips so that its cloud servers will have a cost advantage vs that of competitors. In this aspect (chip), I guess Aliyun is disadvantaged against AWS.

[Wildreamz]

Alibaba has a custom chip division (Pingtouge) since 2018: https://equalocean.com/analysis/2021040716142

How it compares to AWS I can't tell (probably inferior, AWS is the industry leader, and Amazon has a much higher R&D budget after all).

But Alicloud has larger issues; it can never be compared to AWS internationally, IMHO given general international distrust towards the Chinese government, and potential sanctions from the US government over data security concerns.

As for "hard sciences"; both Alibaba (https://damo.alibaba.com/) and Tencent (https://www.tisi.org/en) have extremely high R&D budget that they plow back into their business for both short-term (e.g. AI) and long term (e.g. quantum computing) applications. Much like their American counterparts.

2c.