ByteDance’s Need for a TikTok-Oracle Deal: China is Slowing


ByteDance declined to comment.

Mr. Zhang of ByteDance believed early on that only by having an international presence could his company compete on the level of Google, Facebook or Amazon. As ByteDance grew, he encouraged employees to adopt what he called a “Martian” perspective on business. He wanted them to think of ByteDance not as a Chinese company gone global, but as an inherently planetwide enterprise, free of national starting points or biases.

Growing wariness toward China’s technological advances has made that vision look harder to sustain, though. Never before has the United States clamped down on a Chinese company with as much cultural cachet as ByteDance. India banned TikTok in June, also on national security grounds. More European governments are shying away from using Chinese telecommunications equipment, fearful of espionage.

ByteDance’s rivals in China began discovering long ago how hard overseas expansion could be.

The internet giant Tencent is a global heavy hitter in video games through its holdings of developers including Epic Games and Riot Games. It has mostly failed, however, to export its best-known product: WeChat, the company’s Swiss Army knife of an app, which the Trump administration is also threatening to curb. India recently banned the mobile version of the shooter game PlayerUnknown’s Battlegrounds, which Tencent distributes in the country.

China’s other internet behemoth, the e-commerce giant Alibaba, still makes more than 90 percent of its revenue at home despite years of investment in overseas marketplaces. Two of China’s newest tech titans — the shopping site Pinduoduo and the food delivery platform Meituan — are focused heavily on the domestic market.

“Tencent’s businesses are diversified with multiple revenue streams that we expect to generate sustained growth in the years ahead,” the company said in an emailed statement. “The China market continues to offer tremendous opportunities,” the statement said, adding that the company would continue to explore overseas expansion.

Alibaba declined to comment.

ByteDance is hardly a minnow in China. There, TikTok’s sibling app, Douyin, is beloved by advertisers and helps carry the Communist Party’s propaganda messages. ByteDance now accounts for around one-fifth of online advertising revenue in China, a larger share than Tencent and the search engine Baidu, according to the research firm Bernstein. The country’s online ad market was worth $95 billion last year, according to iResearch.



Source link

Leave a Reply

Your email address will not be published. Required fields are marked *