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China Gives Independent Internet Platforms More Room To Grow

BY Jessica McKenzie | Monday, July 15 2013

WeChat promotion (Flickr/liewcf)

At the end of May techPresident reported on the Beijing Health Department's decision to shut down Taobao, an Internet marketing services platform, because it competed with the city's public service. By choosing to shut it down, Beijing demonstrated China's preference to squash disruptive innovations in favor of government establishments. However, a recent Tech in Asia report suggests that China might be easing up on those restrictions on disruptive technologies, up to a point.

One of the examples of loosening regulations was the Beijing transportation office's reversal of the ban on an essential element of Chinese taxi-finder apps. The app allows someone trying to hail a cab to offer additional money, frequently up to RMB 20 ($3.23), to entice a taxi driver to come pick them up. Instead of banning the popular feature, the Beijing transportation office capped potential fees at RMB 5 ($0.80).

On the other hand, the Tech in Asia reporter points out that although a new (and expensive) online train ticket vendor is buggy and hard to use, the Railway Ministry has shut down all apps and add-ons that have tried to improve the existing platform.

Earlier this year, China's Ministry of Industry and Information declined to intervene on behalf of Chinese telecoms in their battle with WeChat, a Chinese WhatsApp, Instagram and even Tinder hybrid. The government justified the decision by saying that it does not want to stifle innovation in the technology sector.

They especially do not want to squash innovation that is not truly disruptive of the system, and might have facilitated the suppression of a truly disruptive force: dissidents. At least one human rights activist, Hu Jia, suspects messages exchanged on WeChat led to his arrest.

"I took a chance and assumed WeChat was relatively safe," Jia told the Guardian. "It's a new product and not developed by China Mobile or China Unicom, [two of China's main telecoms companies], which have been monitoring my calls and text messages for over 10 years. But the guobao surprised me with their ability to repeat my words or voice messages verbatim, though I'm sure I only sent them to some friends through WeChat."

Moreover, with the growing popularity of WeChat, China has the ability to monitor user activity even outside the country.

“The Chinese government could in theory gain access to anything stored on a server in China,” Jeremy Goldkorn, founder and director of Danwei, a research firm that tracks Chinese media and internet, wrote to VICE in an email. “Furthermore, the Chinese government could in theory apply pressure on a company whose major operations and revenue are in China to hand over data stored outside China.”

So while WeChat may be minimally disruptive to state-owned telecoms, it is actually reinforcing and expanding the scope of China's surveillance network.

All things considered, WeChat is a pretty powerful tool to throw under the bus. One can see why the Chinese government is letting that particular “disruptive” technology have room to grow.

Personal Democracy Media is grateful to the Omidyar Network and the UN Foundation for their generous support of techPresident's WeGov section.