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Your daily dose of China's tech
April 10, 2019
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“The foldable screen is a revolutionary force that fuels the next big change.”
 

Zhang Yu, a senior VP of marketing at BOE, a Chinese OLED screen maker—though research company Gartner disagrees

 
TechNode is no stranger to big changes. So, if this email was forwarded to you, subscribe here. Otherwise, send it to your friendsthey'll be grateful.

Luckin may not last, but its model will

 

Michael Norris writes:

"I’ve spent a lot of the last month trying to understand Luckin Coffee. I’ve untangled how the convenience-focused upstart was built with money from a network with arguably a few too many personal interests at stake and explained the rationale behind questionable freebies and discounts.

I’ve been asked whether Luckin could ever make a profit and become a sustainable business. It’s an interesting dinner party question, but I think Luckin’s story is more than an individual company’s boom and potential bust—it represents a wave of aggressive startups bringing the online world’s “go big or go home” approach to physical assets".
 

In the final article of a three-part Luckin series, TechNode contributor Michael Norris explains the bigger issues that will persist even if the company never breaks even.

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Yu’e Bao lifts subscription cap on Alipay

What: Ant Financial’s money market fund Tianhong Yu’e Bao is lifting a cap on daily subscription volume, following a 30% decrease in 2018. In fact, in a notice released Tuesday by Tianhong, limits on total investments and daily maximum contributions have been lifted effective Wednesday to “better meet demands from general investors.”

Big assets: Operated by Chinese asset management firm Tianhong and available on Alibaba’s payment platform Alipay since 2013, the fund allowed users to invest at a rock-bottom minimum of RMB 1 ($0.15), and featured yields that rose as high as 4% in mid-2017. Tianhong Yu’e Bao (not to be confused with Yu’e Bao, Alipay’s online wealth management platform) became the world's largest money market fund in April 2017 when it was managing assets of $165.6 billion, surpassing the JPMorgan US Government Money Market Fund ($150 billion).

Limits: Yu’e Bao began capping investments. Beginning in August 2017, investors could not exceed a total maximum of RMB 100,000, more than half the limit set in May of the same year. Four months later, the daily maximum contribution was capped at RMB 20,000. In February and March 2018, it also imposed a temporary daily cap to ensure the fund’s smooth operation and “prevent the fund from growing too rapidly.”

Background: Due to its over-rapid growth, China’s largest money market fund has aroused regulatory concern in recent years, including a remark from a government official censuring its “too-massive volume compared to offerings from traditional banks.” The China Securities Regulatory Commission (CSRC) implemented new regulations in October 2017, urging public fund managers to control asset volumes without exceeding 200 times their risk reserves.

- Jill Shen
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Shots

Concentrated daily news
Alibaba’s courier app Cainiao Guoguo announced today on the microblogging service Weibo that the company will recruit 100,000 more deliverymen within the next three years. The company added that it aims to increase the average income of its delivery fleet by more than 20% during the same period. Launched in 2016, Cainiao Guoguo is a one-stop package-tracking and order-placing platform.
 

JD.com is working on a new round of layoffs that could affect up to 8% of its 150,000 employees—or more than 12,000 positions across various business units—reports The Information, citing investors in the Nasdaq-listed company. However, JD.com has denied the report to Chinese media. The job cuts are a result of normal workforce fluctuations, according to the e-commerce company, which emphasized that they are planning to recruit for 15,000 jobs this year.
 

YouTube star Felix Kjellberg, better known as PewDiePie, will stream exclusively on DLive, a US-based decentralized live-streaming platform founded by Chinese entrepreneurs. Under the partnership, he will stream weekly on the decentralized application (dApp), starting April 14. In his first livestream on the platform, PewDiePie will donate up to $50,000 in Lino Points (the currency used on the Lino blockchain that DLive runs on) to other creators on the platform to encourage more uptake.
 

Security firm Hikvision has provided its cameras to the British Parliament, as well as to police, hospitals, and schools around the United Kingdom, raising concerns from politicians. The company is selling its equipment through a network of corporate partners, according to The Intercept.
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Drips

Small drops to get smart on China's tech world
  • Apple censoring: Apple Music has banned a song in China which references the Tiananmen incident of 1989. (Gizmodo)
     
  • Outfit outrage: A Chinese livestreamer was arrested for wearing the Young Pioneers’ red scarf as part of an allegedly provocative outfit. (SCMP)
     
  • Rude tourism: Beijing authorities want to implement a facial recognition system that would ban misbehaving tourists from popular attractions. (Techinasia)
     
  • More indexes: The Shenzhen Stock Exchange launched two indexes on Tuesday for tech companies in the Greater Bay Area. (Caixin)
     
  • Reputation: Pinduoduo has been trying to shake off its negative image as a platform that sells fakes as Apple seeks to halt sales on the platform. (TechNode)

That's all for today!

Hoping you find this mail helpful. I'm already drawing up tomorrow's edition. Thanks for reading and supporting us. Have a great day.

If you have any feedback for us, please feel free to reply directly to this email.

Alberto Sperindio
Newsletter Editor

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