July 12, 2020: TikTok, More TikTok, Canada, Elon Musk, Open Source, Blued

Note: This issue of Interconnected Weekly covers the period between July 5-July 12, 2020, with six news stories – three from English language sources, three from Chinese language sources – hand-picked by your humble author to further our exploration of the interconnections between technology, business, investment, and geopolitics. All translated article titles are done by me; they are not official translations from the media outlets.

“For TikTok, an Amazon Ban That Wasn’t, a Wells Fargo Ban That Was” (English Source: The Information)

My Thoughts: TikTok continues to be the center of attention (or collateral damage) in the continued deterioration of US-China relations. Amazon’s employee-wide ban of TikTok, now reversed, reveals just how confusing everything is. If TikTok is a security problem, the ban is justified, but we don’t know if that’s true. If TikTok is not a security problem, then the ban should be reversed, but we also don’t know if that’s true. Amazon’s reversal is further muddled by its growing partnership with TikTok -- Amazon already buys ads on TikTok and will potentially collaborate further so users can directly buy products showcased on TikTok via Amazon (an e-commerce model that’s already mature in China). Is Amazon’s reversal caused by conflict of business interests with security interests? We don’t know! There’s a lot of unknowns about TikTok, yet a lot of action taken about it, like Wells Fargo complete ban. That’s textbook paranoia. (For more on TikTok, see my deep-dive post from a few weeks ago: “Can ByteDance Build Trust?”)

“Co-founder of an Indian alternative to TikTok says his firm will never accept Chinese investments” (English Source: CNBC)

My Thoughts: The co-founder of the Indian TikTok alternative, Chingari, showed a lot of bluster and nativism, proudly proclaiming to never take any Chinese money as investments. The interview of him and the CNBC reporters is worth watching to feel his nativist energy. (Sequoia Capital seems to have great timing, closing another India-focused fund worth $1.35 billion USD.) The trend of Chinese Internet giants and VCs making investments in India does not just make sense for China, but also for India’s own development in tech. Although the cultures are vastly different, India’s Internet economy is roughly about where China’s was 10-15 years ago, with a similarly huge and dense population, many of whom are growing up with smartphones. Thus, the successes and failures of Chinese tech companies are a valuable source of learning for Indian tech companies. In this sense, Chinese money is arguably the “smarter” money than any other source of funding. Taking investments is never just about the money, but more about the knowledge transfer that comes with it. It will be interesting to see if all the recent conflicts between India and China, and India’s own growing nativism under Modi, will actually set back India’s economic advancement.

“Canada opens doors to Asian tech talent fleeing Trump's US” (English Source: Nikkei Asian Review)

My Thoughts: As some of you may know, I have a hybrid personal identity as a Chinese-Canadian-American. Thus, reading this story about the flow of tech talent to Canada, in the background of increasingly hostile policies towards skilled immigrants in the U.S., is a bittersweet feeling. I don’t think any country should have a monopoly on human talent. Just like building a company, talent is something you attract through incentives and friendly policies, not to be taken for granted. In the context of technology, with the rise of remote work especially in the software industry, the global talent pool is more fluid than ever before. Both newer companies like Square and older companies like Fujitsu are changing the way work gets done to retain and attract the best talent globally. But these people still have to live somewhere to build a family, a community, and a life. Countries who don’t learn to adapt in the same way will lose competitiveness in the long-run, doesn’t matter how rich and powerful they are now.

“Elon Musk's Q&A at 2020 World Artificial Intelligence Conference” (Chinese Source: World Artificial Intelligence Conference)

My thoughts: I’m including this video in the Chinese language source section of this issue, because the 2020 World Artificial Intelligence Conference (the 3rd conference of its kind) took place in Shanghai and was mostly in Chinese (see full recording). Of course, Elon did his Q&A in English. Most of the media coverage focused on Elon’s bold proclamation that Tesla is very close to achieving Level-5 autonomous driving capabilities. But what stood out to me was Tesla building an autonomous driving engineering team in China and Elon emphasizing that this team will do “original engineering”, not converting and adapting what the American engineering team is doing in China. This has huge technological and geopolitical implications. One interesting piece of technical insight that Elon shared: the effectiveness of autonomous driving depends a lot on where the engineers are to do local optimization -- Tesla AutoPilot works the best in California right now because that’s where their engineers are. Assuming the Tesla China engineering team will be in Shanghai, where its GigaFactory is located, Shanghai and the nearby region may be one of the first places to have autonomous driving in the world.

“Linux Foundation: open source technology is not subject to the EAR restrictions of the US export control regulations and can be used freely” (Chinese Source: Open Source Society)

My thoughts: There is a lot of confusion and fear in China’s technology community on whether open source technology will be restricted by U.S. government's increasingly aggressive sanctions. With these sanctions’ target being obviously China, the Linux Foundation published a whitepaper in both English and Chinese (and no other language) to clarify the confusion. The simple answer is no, open source technology is not subjected to these restrictions. That being said, the white paper also laid out many best practices in the form of more transparency, public governance, and notifications to both the relevant government agencies and your open source developer community. I’ve written extensively in both “RISC-V, China, Nightingales” and “Open Source in China Part I, II, III” that open source technology could be the foundation to China’s technology self-reliance. However, it must also practice the “open source way” of transparent development, project governance, and active contribution, which many players in China do not do or even grasp their importance. On a broader level, open source may be the only thing keeping the technology world together, as big nation geopolitics continue to drive it apart.

“Interview with Blued founder Geng Le” (Chinese Source: Tencent Tech News)

My thoughts: This interview with the co-founder and CEO of Blued is worth reading for two reasons. 1. There are lots of good company building and management lessons shared in this interview, which always interest me as an entrepreneur and operator. As the largest LGBTQ social network in China, Blued is both an innovator of social media business models (livestreaming is the core of its business) and reflects the grayscale of individual freedom that exists inside China. This “grayscale” is not well-understood outside of China, where most people subscribe to the notion that China is an oppressive monolith; 2. Blued’s IPO on the NASDAQ continues to defy the hostile mainstream narrative towards Chinese companies in America, after other recent examples like Agora and Dada. It’s a dynamic that I’ve been tracking in previous issues of Interconnected Weekly. Much larger Chinese tech companies are doing secondary listings in Hong Kong as backup plans, like JD.com and Netease. But for a new generation of maturing companies, New York continues to be the prime destination for IPO.

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