According to a new report, the Chinese government has asked Jack Ma’s Alibaba group to lose its media assets as officials there are increasingly concerned about the tech giant’s impact on public opinion in the country.
Talks began earlier this year after Chinese regulators reviewed a list of Alibaba’s media properties, according to a report in the Wall Street Journal. Officials were upset at how big the online retailer’s media business had become and urged the company to devise a strategy to reduce its inventory, WSJ said, citing anonymous sources.
Ma’s Alibaba has an extensive portfolio of media resources that include print, broadcast, digital, social media and advertising. The total value of Alibaba’s media assets could not be determined, but holdings in public companies had a combined market value of more than $ 8 billion, according to a Wall Street Journal balance sheet.
The company’s best-known media stocks include investments in Weibo, the Twitter-like platform, and the English-language newspaper South China Morning Post. The fortune is seen as a threat as it poses a potential challenge to the Chinese Communist Party and its own powerful propaganda machine.
Government officials did not specify which media items should be dropped, and it is not clear whether Alibaba has all media items would have to sell, but any plan must be approved by China’s top leadership, the report said.
According to reports, officials are also keeping an eye on Alibaba’s entertainment division, which consists of Hong Kong-listed Alibaba Pictures Group and Youku Tudou, one of China’s largest video streaming platforms. Although sources have told WSJ that a full divestment of the entertainment portfolio may not be required.
Alibaba did not immediately respond to requests for comment, but told The Journal, « The purpose of our investments in these companies is to provide technology support for provide their business upgrade and promote commercial synergies with our core businesses. We do not intervene in the daily processes or editorial decisions of the companies or do not participate in them. “
The asset divestment talks are also the latest in a series of arguments between Beijing and its billionaire founder Ma – once China’s most famous business leader.
The clashes began after Ma gave a speech on October 24th in which the Chinese regulatory system was blown. Days later, the same regulators suspended its Ant Group’s $ 37 billion initial public offering ahead of the fintech giant’s big trading day.
Chinese regulators have also launched an antitrust investigation into Alibaba’s business practices, involving the company Requires merchants to sign exclusive agreements prohibiting them from selling products on competing e-commerce platforms.
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