Category Archives: Mobile and Cloud

Alipay Reaches U.S. Payments Deal

Ant Financial’s Alipay service has inked a deal with U.S. payment processing services provider First Data Corp to allow Alipay users to purchase from more than four million American vendors.

Souheil Badran, Alipay’s North America president, said this will make Alipay ubiquitous in the U.S. and enable it to enter more countries. Instead of operating independently in the U.S., they prefer to cooperate with ecosystems with certain scale.

In China, Alipay and WeChat payment hold combined market share of over 90% in the Chinese mobile payment market. At present, Alipay hopes to provide a wider range of services to Chinese tourists who go overseas. Alipay’s mobile wallet already supports credit cards of American Express, Visa, and MasterCard. So far, over 100,000 retailers in 70 international markets accept payments via Alipay.

By cooperating with First Data, Alipay will be able to lift its penetration level in the U.S. to the same as Apple Pay. Apple’s chief executive officer Tim Cook recently revealed on a conference call that Apple’s mobile payment service is now available at 4.5 million places in the U.S.

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Nokia, China Huaxin Sign Final Agreement For Establishment Of Nokia Shanghai Bell

Nokia and China Huaxin Post and Telecommunication Economy Development Center signed a final agreement to integrate Alcatel-Lucent Shanghai Bell with Nokia China business to establish the new Nokia Shanghai Bell company.

After the announcement, this new joint venture will become Nokia’s main platform in China and it will continue to develop new technologies in sectors like IP routers, fiber, fixed networks, and 5G. At the same time, with the support of Nokia, Nokia Shanghai Bell will continue to seek opportunities in some overseas markets.

Alcatel-Lucent Shanghai Bell and Nokia China business have already been operating as one entity since they reached a temporary operating agreement in January 2016. The final agreement is expected to be completed in July 2017; however, it is still subject to administrative, legal, regulatory and other conditions.

Nokia will hold 50% plus one share of Nokia Shanghai Bell share, while China Huaxin will hold the remaining shares.

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Alibaba, China Telecom Seal New Deal For Network Services

Alibaba and China Telecom signed a comprehensive strategic cooperation agreement in Beijing that includes work on Internet of Things and payment services.

Under the agreement, the two parties will begin working together in various areas such as e-commerce, online security, marketing services, cloud computing, online payments, IoT, and corporate procurement services. Financial terms and expectations of returns of the deal were not released by either party.

The two parties will work together to enhance the corresponding cooperation between China Telecom’s five ecospheres, including smart access, smart home, new ICT applications, Internet finance, and Internet of Things, and Alibaba’s five “new” areas, including new retailing, new manufacturing, new finance, new technology, and new energy. In addition, they will further discuss and explore future in-depth deals.

China Telecom and Alibaba Group have already been working on a prior partnership and the two parties have implemented multi-level cooperation in data center services and mobile payments.

So far, Alibaba has signed cooperation agreements with all three major Chinese telecom operators. In November 2016, Alibaba inked a strategic cooperation framework agreement with China Unicom in Hangzhou; and in December 2016, the e-commerce group signed a strategic cooperation framework agreement with China Mobile in Beijing.

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Digital Transformation in Retail – 13 Action Steps

GettyImages 568519199 Digital Transformation in Retail   13 Action Steps
  1. Recognize the need for digital transformation extends beyond websites and mobile apps to the entire organization and across all business processes.
  2. Understand the degree of change occurring in retail as a result of customers’ fast-changing behaviors.
  3. Judge accurately where your organization stands on a digital technologies maturity curve.
  4. Show the necessary leadership to change strategies, budget priorities and plans based on new data, trends and insights, and then make the required investments in digital technologies, people and skills to compete successfully.
  5. See that traditional channel-centric strategies are no longer viable; rather, retailers must adopt precise, customer-centric strategies, enabled by digital technologies.
  6. Don’t excuse slow adoption of digital technologies, as the data is clear and compelling and demands immediate action.
  7. Think with a digital mindset, intimately understand the capabilities of digital technologies, understand digital’s role and importance in customer interactions, and develop new digital business models, processes and strategies for supporting today’s and tomorrow’s digital markets and consumers.
  8. Realize that digital transformation and the industry’s adoption of digital technologies are occurring on an accelerated schedule that peaks around 2020. It waits for no retailer’s budget cycles, three-year master plan, leadership change or strategy.
  9. Align the pace of digital transformation initiatives with the speed at which consumers are adopting digital technologies, behaviors, markets and thinking. This might mean over-investment in the near term to catch up or stay ahead of the competition.
  10. Unify disparate digital transformation initiatives behind a single company-wide digital transformation doctrine – a guiding statement that effectively describes the reason for digital transformation, what needs to happen and what winning looks like. This doctrine must be used to direct and shape the entire company’s efforts.
  11. Closely monitor the business impact of rapidly emerging digital technologies to ensure investments are prioritized and acted upon in the right time and place to maximize ROI and competitive advantage, while also balancing the need to innovate and embrace a fail-fast, test and learn mentality.
  12. Understand how digital transformation will alter traditional retail roles, responsibilities and skills for all associates.
  13. Pay close attention to how digital transformation shapes and changes consumers’ interactions and experiences, and train associates to best serve digitally enabled consumers.
 Follow Kevin Benedict on Twitter @krbenedict, or read more of his articles on digital transformation strategies here:
  1. Mistakes in Retail Digital Transformation
  2. Winning Strategies for the Fourth Industrial Revolution
  3. Digital Transformation – Mindset Differences
  4. Analyzing Retail Through Digital Lenses
  5. Digital Thinking and Beyond!
  6. Measuring the Pace of Change in the Fourth Industrial Revolution
  7. How Digital Thinking Separates Retail Leaders from Laggards
  8. To Bot, or Not to Bot
  9. Oils, Bots, AI and Clogged Arteries
  10. Artificial Intelligence Out of Doors in the Kingdom of Robots
  11. How Digital Leaders are Different
  12. The Three Tsunamis of Digital Transformation – Be Prepared!
  13. Bots, AI and the Next 40 Months
  14. You Only Have 40 Months to Digitally Transform
  15. Digital Technologies and the Greater Good
  16. Video Report: 40 Months of Hyper-Digital Transformation
  17. Report: 40 Months of Hyper-Digital Transformation
  18. Virtual Moves to Real in with Sensors and Digital Transformation
  19. Technology Must Disappear in 2017
  20. Merging Humans with AI and Machine Learning Systems
  21. In Defense of the Human Experience in a Digital World
  22. Profits that Kill in the Age of Digital Transformation
  23. Competing in Future Time and Digital Transformation
  24. Digital Hope and Redemption in the Digital Age
  25. Digital Transformation and the Role of Faster
  26. Digital Transformation and the Law of Thermodynamics
  27. Jettison the Heavy Baggage and Digitally Transform
  28. Digital Transformation – The Dark Side
  29. Business is Not as Usual in Digital Transformation
  30. 15 Rules for Winning in Digital Transformation
  31. The End Goal of Digital Transformation
  32. Digital Transformation and the Ignorance Penalty
  33. Surviving the Three Ages of Digital Transformation
  34. The Advantages of an Advantage in Digital Transformation
  35. From Digital to Hyper-Transformation
  36. Believers, Non-Believers and Digital Transformation
  37. Forces Driving the Digital Transformation Era
  38. Digital Transformation Requires Agility and Energy Measurement
  39. A Doctrine for Digital Transformation is Required
  40. Digital Transformation and Its Role in Mobility and Competition
  41. Digital Transformation – A Revolution in Precision Through IoT, Analytics and Mobility
  42. Competing in Digital Transformation and Mobility
  43. Ambiguity and Digital Transformation
  44. Digital Transformation and Mobility – Macro-Forces and Timing
  45. Mobile and IoT Technologies are Inside the Curve of Human Time

************************************************************************

Kevin Benedict
Senior Analyst, Center for the Future of Work, Cognizant
View my profile on LinkedIn
Follow me on Twitter @krbenedict
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***Full Disclosure: These are my personal opinions. No company is silly enough to claim them. I am a mobility and digital transformation analyst, consultant and writer. I work with and have worked with many of the companies mentioned in my articles.

Tencent Invests Additional USD90 Million In Pocket Gems

Tencent has invested additional USD90 million into the American gaming company Pocket Gems, and is increasing its stake in the latter to 38%.

Tencent first invested in Pocket Gems in 2015. At that time, that the Chinese Internet company invested USD60 million in acquiring a 20% share of Pocket Gems. After this new investment, Tencent’s stake in Pocket Gems will increase to 38% and this deal values Pocket Gems at about USD600 million.

Pocket Gems only has two main games: Episode and War Dragons. Therefore, it is quite impressive for the company to gain such a high valuation. Pocket Gems was founded in 2009 and its games have reportedly been downloaded over 300 million times.

Pocket Gems will reportedly achieve operating revenue of USD17.5 million in April 2017 and its annual operating revenue would be over USD200 million in 2017 if it could maintain the performance.

Pocket Gems revealed that the company’s operating revenue and player number set new records in 2016; however, no detailed statistics were available.

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Daojia.com.cn Acquired By Pizza Hut's Parent Company

The U.S.-based owner of Pizza Hut and KFC is buying a Chinese food delivery company.

Yum China Holdings Inc, backed by Chinese private equity firm Primavera Capital Group and Alibaba-linked Ant Financial Services Group, has agreed to acquire a controlling interest in online food delivery company Daojia.com.cn to better serve its Pizza Hut and KFC customers.

China Money Network reports that no financial details were disclosed, but the deal is expected to be completed by the end of May 2017.

Founded in 2010, Daojia.com.cn is an online food delivery service provider focused on higher-end orders in major cities in China, including Beijing, Shanghai, Shenzhen and Guangzhou. It also operates food delivery service Sherpa’s, and has partnered with over 6,000 brands and restaurants, providing services for over one million family customers.

Daojia.com.cn previously raised a US$ 2 million series A round from Morningside Venture Capital in 2010. It secured a US$ 7.5 million series B round from CDH Investments in 2011, and completed a US$ 10 million series C round led by JD.com Inc and Morningside in 2013. In 2014, the company received a US$ 50 million series D round led by JD.com and Macquarie Group Ltd, according to its website.

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China's Huawei Gains Network Upgrade Contract In Iran

Huawei and Telecommunication Company of Iran have jointly launched a new project aiming to integrate and upgrade the fixed telephone and mobile telecommunications networks of Iran.

Babak Tarakome, chairman of TCI, said that Huawei has organized seminars for Iranian technical staff that will assist Chinese enterprises to implement the project. A new program, which will improve project implementation efficiency and integrity, has been designed and launched in cities like Tehran. Tarakome revealed that TCI is purchasing equipment needed for the project; however, no further detail was given.

The whole project includes two parts: IP network integration and packet optical transport network.

Tarakome said by integrating the fixed telephone and mobile telecommunications networks, they will be able to lower operating costs and improve service quality. Therefore, this project is very favorable for TCI’s future. On the completion of the project, the telecom network of Iran will see a significant improvement and TCI can provide services anytime, anywhere via the integrated and fully automated system.

Full financial details of the deal were not released by either party.

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After Dumping Its Mobile Business, Baidu Needs To Innovate Again

What does Baidu’s sale of its mobile business portend for its ability to integrate businesses?

At the end of March 2017, the Chinese search engine company told the U.S. Securities and Exchange Commission that it sold its mobile gaming business. Two companies took over Baidu’s gaming business for CNY1.2 billion. Baidu has also renamed its gaming business to “Duokoo Game” and separated it for independent operation.

In July 2013, Baidu announced the full acquisition of 91 Wireless for USD1.9 billion, which was reportedly the largest acquisition in Chinese Internet history at that time. 91 Wireless is mainly engaged in mobile Internet application distribution and its core assets include 91 Mobile Assistant, Android app store, 91 mobile open platform, PandaReader, and a mobile gaming portal.

After acquiring 91 Wireless, Baidu’s mobile business did not see much improvement. In 2014, Baidu integrated its Duokoo mobile game business with 91 Wireless game business to formally establish a Baidu-branded mobile game division.

Baidu has taken heat in the past year for not being nimble enough on its investments and acquisitions. It has been outpaced by rivals Tencent and Alibaba in gaining footholds in nascent sectors like artificial intelligence, and only recently has named new executives to run a revamped investment strategy for the company.

Ultimately, Baidu’s future rests in how it has developed in a vacuum in the past. Because of protectionist policies, Baidu has not had competition, especially from foreign rivals like Google. And without competition, its services have not had to be the best. For example its search engine routinely does not deliver highly relevant results. And because its services have not had to be the best, its staff perhaps have not been trained to exceed expectations.

For Baidu to continue to do well in new sectors like AI, it should revamp its internal structure and “be hungry” in order to reach new heights.

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China's Meizu Restructuring Forms Three Major Business Units

Chinese smartphone maker Meizu is facing stiff competition and shrinking margins, and the company is responding with its new organizational structure.

In the new organizational structure, Meizu’s chairman and chief executive officer Huang Zhang will directly participate in the operation of the company. Meanwhile, Meizu will be divided into three major business units: Meizu business unit, Meilan business unit, and Flyme business unit.

Huang will be in charge of the Meizu business unit, commanding businesses related to Meizu and Meizu’s high-end smartphone brand. As the president of Meizu, Bai Yongxiang will accept reports of various function centers and manage the three business units along with Huang.

Li Nan is promoted to Meizu’s senior vice president and president of Meilan business unit. The newly established Meilan business unit will take control of brand, market, and sales functions, in addition to product planning.

Yang Yan is promoted as Meizu’s senior vice president and president of the Flyme business unit. He will continue to coordinate operating system experience and commercial businesses of Meizu.

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Xiaomi Signs Strategic Supply Chain Investment Deal With Hubei Province

Chinese smartphone maker Xiaomi announced a strategic cooperation agreement with Hubei province.

Under the strategic cooperation agreement, Xiaomi will join hands with the Yangtze River Industry Fund to initiate a CNY12 billion industrial fund, which will be used to support business expansion of Xiaomi and enterprises covered by Xiaomi’s supply chain, or “ecological chain”.

Xiaomi has already established two service sites in Hubei, one in Wuhan and one in Xiantao. There is no Xiaomi supply chain enterprise in Hubei yet. Xiaomi calls its supply chain ecosystem an “ecological chain”, which is a smart hardware incubator.

At the end of 2016, Xiaomi’s founder, chairman and CEO Lei Jun said in open letter that the annual revenue of Xiaomi smart hardware ecological chain was expected to reach CNY15 billion in 2016. So far, Xiaomi has invested in 77 smart hardware ecological chain enterprises, of which five are valued at over USD1 billion. The products cover smart wearable devices, water purifiers, and air purifiers. In addition, Lei said Xiaomi will invest in 100 ecological chain enterprises within five years and the company’s total revenue is expected to be over CNY100 billion in 2017.

The Yangtze River Industry Fund was founded on December 30, 2015 and its sole mission is industry development, focusing on strategic emerging industries. With a global vision, it extensively integrates advantageous resources such as funds, projects, and talents to drive the breakthrough development of strategic emerging industries in Hubei.

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