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        The Industrial Internet Has Broad Prospects

        2023-05-30 23:31:20ByGuoYan
        China’s foreign Trade 2023年1期

        By Guo Yan

        In 2022, the internet industry witnessed fierce competition and pressure. Internet companies such as Tencent, Baidu, Alibaba, JD, Bilibili.com and Meituan all chose to reduce costs and increase efficiency, cut businesses costs and adjust corporate structures. Improving operational efficiency is crucial for Internet companies. While the internal adjustment of internet enterprises was taking place, external regulations were becoming stricter. Last year, the internet industry saw the issuance of a series of policies, aiming to promote the healthy and sustainable development of the industry. The Internet industry has been improving under supervision. In what direction will it develop in the future? How should enterprises, workers, brands/businesses and consumers face such changes?

        Features of platform economy supervision in 2022

        Feature 1: corporate compliance and data privacy security are the focus

        On July 21, 2022, the Cyberspace Administration of China (CAC) announced a fine on Didi Global Inc. for violations of data security and personal information protection laws. The CAC fined DiDi Global Inc. RMB 8.026 billion, and fined DiDi Global Inc. Chairperson and CEO Cheng Wei and President Liu Qing RMB 1 million each.

        Li Min, a senior partner of Shanghai Hansheng Law Firm and a special researcher of the E-Commerce Research Center of 100EC.CN, said that this punishment has sent a warning to the industry about over-collection of user information and over-request about user authority. Increasing the exposure of typical cases will help to educate and guide internet enterprises to operate in compliance with the law, and make their business growth more healthy, standardized and orderly. On top of this, such measures will detect and avoid risks related to the operation of key information infrastructure in advance, ensure the security of the supply chain of key information infrastructure, and maintain national security.

        “However, for internet enterprises, corporate compliance and data privacy security are still the focus of the Internet industry regulation. The RMB 8 billion fine given to Didi shows that internet enterprises will focus more on data compliance,” said Li Min.

        Feature 2: bottom line for livestreaming anchors and tightened regulation on the livestreaming e-commerce industry

        On June 22, 2022, the National Radio and Television Administration and the Ministry of Culture and Tourism jointly issued the Code of Conduct for internet Anchors, which included 18 articles. The Code of Conduct regulates 31 restricted behaviors for internet anchors when putting together online content and providing audio-visual program services. For livestreaming content that requires professional know-how (such as medical health, finance, law and education), the anchors need to hold professional qualifications, and report those to the live broadcast platforms. The live broadcast platforms should review and record the qualifications of the anchors.

        Li Min said that for network anchors, the Code of Conduct clearly defines the scope and boundaries of the anchors behavior. In addition to anchors in the conventional sense, the people who speak or appear in uploaded audio and video platforms (such as those on Bilibili) and virtual anchors are also subject to these regulations. At the same time, the Code of Conduct lists 31 behaviors that are not permitted by network anchors in the process of creating content online and providing audiovisual program services, to tackle the outstanding problems in online performances and audiovisual program services. It has set the bottom line and red line for the anchor behavior.

        At present, the live broadcast e-commerce industry chain includes comprehensive platforms like Tiktok, Kuaishoui, Bilibili, Taobao Live, JD Live and Pinduoduo Live, MCN institutions like Qianxun, Mountaintop, MeiONE, Yaowang Technology, Chenfan, Xinxuan, Joy Media and Jiaogepengyou, and livestreaming anchors including Li Jiaqi, Lieer Baby, Simba, Yudagognzi, Shidapiaoliang, Dan Dan and Dong Yuhui.

        “For live broadcast content at a professional level, it is imperative to set an entry threshold when it comes to requirements. Internet anchors who refuse to adhere to the requirements after being made aware of these repeatedly, will be put on a watchlist. Regarding livestreaming e-commerce, it is necessary to connect the anchors behavior with the anchors qualifications and future career, which will help solve issues surrounding fake goods, infringement of intellectual property rights, false publicity and tax evasion. Anchors will adhere to the obligations of assessments when selecting products, and pay tax according to tax regulations. This will contain the excessive growth of the livestreaming industry and promote healthy and orderly development of the industry instead,” said Li Min.

        Feature 3: the year of law enforcement for the anti-monopoly of platform economy

        On June 24, 2022, the 35th Session of the Standing Committee of the 13th National Peoples Congress voted to amend the anti-monopoly law, which has come into force on August 1, 2022. The new antimonopoly law has made adjustments in five aspects, and it has improved the supervision system and reduced the contradictions between legislation and law enforcement by changing the safe harbor rules. In order to implement the new anti-monopoly law, on June 27, the State Administration of Market Supervision and Administration released six regulations supporting the anti-monopoly law and drafting instructions.

        The year 2021 can be described as the “big year” of anti-monopoly. Alibaba was fined RMB 18.228 billion for antimonopoly activities and Meituan was also fined RMB 3.442 billion.

        Dong Yizhi, a special researcher of the E-Commerce Research Center of 100EC.CN and a lawyer at the Shanghai Zhengce Law Firm, believes that 2022 is the year of law enforcement for the anti-monopoly of the platform economy. The digitization of the platform economy has further increased the demand and necessity of anti-monopoly guidelines, and ensuring activities are not falling into the trap of being a monopoly in the digital economy has become a new focus for law enforcement. This area is also a battlefield between internet enterprises and regulators. Although“killer acquisition” has been one of the regulatory focuses in the field of anti-monopoly and preventing the disorderly expansion of capital in the internet field over the past year, in fact, internet giants have not stopped engagement in mergers and acquisitions.

        Supervision has become normalized gradually

        At the end of 2022, the Central Economic Work Conference made an important deployment for economic work in 2023, proposing to vigorously develop the digital economy, improve the level of normalized supervision, and support platform enterprises to play a more important role in leading development, creating jobs, and being competitive internationally.

        Li Min said that compared to 2021, the regulation of the internet industry has slowed down because the relevant regulatory mechanisms have improved relatively and regulatory agencies have been established. In 2022, the biggest risk factor of the internet industry has shifted from industry supervision to the decline of corporate profits and peoples consumption capacity due to repeated pandemics. At the Central Economic Work Conference, the attitude towards the regulation of the internet industry changed from “strengthening antimonopoly and preventing disorderly expansion of capital” to “boosting the confidence of market players”. It is easy to see that the regulatory focus has shifted in 2022.

        At present, the growth rate of consumer Internet is slowing down and tends to be saturated, and the development potential of industrial internet has been gradually released. Internet platform enterprises have adjusted their investment and operation strategies and more actively engaged in the industrial internet. In 2022, industrial internet platforms created by Tencent, Alibaba, Baidu, JD and other major platform enterprises were all included in the “List of Crossindustry and Cross-sector Industrial Internet Platforms” issued by the Ministry of Industry and Information Technology.

        Looking forward to the future, the industrial internet has broad prospects for development. Accenture predicts that by 2030, the industrial internet will contribute USD 14.2 trillion to global economic growth. As a large manufacturing country and network country, China has complete industrial systems and active information technology innovation, and also huge market demand and rich application scenarios. The potential of developing the industrial internet is huge, which will open up a new channel for the transformation and innovation of platform enterprises.

        Since early 2023, supporting the healthy development of the platform economy has become the “top priority”of local governments. According to reports, Jiangsu, Shandong, Shaanxi, Henan and Hunan have recently issued policies to support the development of platform economy.

        Regarding the financial business of platform enterprises, at the press conference held on January 13, Ma Jianyang, Head of the Financial Market Department of the Peoples Bank of China, said that since November 2020, the financial management department had guided and urged 14 large platform enterprises including Ant Group to rectify some outstanding problems. Now the rectification work has almost finished. The normalized regulatory framework for financial business of platform enterprises has also taken shape.

        Pan Helin, Co-director and researcher of the Research Center for Digital Economy and Financial Innovation of the International Business School of Zhejiang University, also said that in the field of the digital economy and platform economy regulation, normalized regulation will replace centralized regulation. Future regulation will aim to standardize the development of the digital economy and platform economy with clear policy lines, so that there are laws and regulations to follow. It will also allow digital and platform enterprises to understand the policy red lines, and achieve growth in a legal and reasonable manner.

        In Li Mins view, as the data legislation further improves, data security and data trading will be the focus of the internet industry regulation in 2023. The revision of the Cybersecurity Law in the second half of 2022 and the “20 Data Articles” issued by the central government in December 2022 indicate that data security and data trading will become the focus of the internet industry in 2023.

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