Jack Ma’s Pain May Explain Why Kevin Mayer Got Out of TikTok

When TikTok first came under criticism for being under the control of the Chinese Communist Party, many in the music business didn’t quite know what to make of it. Kevin Mayer’s sudden departure seemed kind of inexplicable and sudden. I moderated a panel of great experts on the subject at the Music Business Association Law and Technology Conference (materials here) and we put together what I still think are important background documents for understanding the differences between doing business in an authoritarian collectivist state that has the legal basis in national law to demand not only compliance, but also governance and also ownership.

Now we have evidence from billionaire Jack Ma and Alibaba/Ant Group of just how in your face Kevin Mayer’s sit down may have been. Remember, Jack Ma is a member of the larger Chinese Communist Party according to the BBC. (I have to believe that TikTok grand poobah Zhang Yiming is also a member and most definitely is very familiar with these sit downs.)

According to the Wall Street Journal’s Lingling Wei, Jack Ma offered CCP regulators any part of Ant Group they wanted if they’d just let him conclude what would have been the world’s largest IPO.

As Jack Ma was trying to salvage his relationship with Beijing in early November, the beleaguered Chinese billionaire offered to hand over parts of his financial-technology giant, Ant Group, to the Chinese government, according to people with knowledge of the matter.

“You can take any of the platforms Ant has, as long as the country needs it,” Mr. Ma, China’s richest man, proposed at an unusual sit-down with regulators, the people said.

Jack Ma has done a number of things to provoke retaliation by the CCP government. He got sideways because Ant Group has a banking operation has loaned approximately $230 billion outside of the CCP’s banking controls. The last straw seems to have been criticizing CCP Chairman for Life Xi Jinping’s financial regulations that Ma felt would cause capital shortfalls that would be made up by the Bank of China (the CCP’s central bank) buying equity to make up those shortfalls. See how that works? They’re not requiring Ant to sell them equity, they are just helping out. That’s a nice IPO you got there, be a shame if something happened to it.

TikTok’s Mr. Zhang has been there and would probably tell Mr. Ma to embrace the suck.  It should come as no surprise–according to his Wikipedia page, Mr. Zhang understands what happens when you don’t toe the Party line:

[Zhang’s] first app, Neihan Duanzi, was shut down in 2018 by the National Radio and Television Administration. In response, Zhang issued an apology stating that the app was “incommensurate with socialist core values“, that it had a “weak” implementation of Xi Jinping Thought, and promised that ByteDance would “further deepen cooperation” with the ruling Chinese Communist Party to better promote its policies.

All of which gives us better insight into why Keven Mayer might have decided to exit TikTok.

@EricJhonsa: Alibaba Doubles Down on Maintaining Its Chinese Cloud Lead

The company is promising to invest more than $28 billion in its cloud services unit over the next three years, and to direct some of the funds towards chip and operating system R&D.

On Monday, Alibaba said that it plans to invest RMB200 billion ($28.3 billion) over the next three years in its Alibaba Cloud unit, which is China’s biggest public cloud services provider. Along with data center infrastructure investments, Alibaba indicated the spending would go towards R&D investments in areas such as chip and operating system development. Other likely spending areas include sales, marketing and the development of new cloud services.

Read the post on TheStreet.com