Lofty Ambitions, New Territories, and Turf Battles: China’s Platforms “Go Out”[1]

Abstract:

This article surveys the internationalization of China’s leading digital communication and entertainment companies, Baidu, Alibaba, and Tencent, and their strategic acquisitions, both domestic and international. The article shows that with regard to audiences and users of their platforms, the most likely “take-off” points outside the Mainland are within Asia. Future prospects for expansion include the One Belt One Road region (the old Silk Road including central Asia), where state-owned enterprises are currently laying out infrastructure. Acquisitions serve a dual purpose: they establish beachheads for expansion overseas, and they allow foreign media to “send” their content to China. The article notes three levels of “going out”: cultural products and services, ideology, and organizations. The article compares the official state cultural media apparatus to the maritime hero Zheng He in the early Ming dynasty, who took a message of cultural supremacy from the center (i.e. the Middle Kingdom) to the peripheral regions. However, the new media companies and their platforms are not representing the government; they are consolidating their operations and aggregating audiences. The article asks, “Whose interests are ultimately being served?”

Keywords: Digital Media, BAT, Online Platforms, Chinese Media Going Out, Soft Power, Cultural Power

Introduction: Culture Goes Digital

How far, and where, does Chinese culture travel? Such questions have exercised the minds of Chinese politicians, national policy advisors, scholars, and many Chinese nationals—ever since 2007’s Seventeenth National Party Congress (NPC) when President Hu Jintao advocated strengthening the nation’s soft power,[3] urging domestic cultural industries to “go out.”[4] Hu’s cultural advocacy followed the international successes of key state-owned enterprises known as “national champions.” By the mid-2000s, “going out” had become a clarion call, a national policy imperative, in effect a change in focus. During the previous decade, internationalization was deemed less important than encouraging foreign companies to “come in.”[5] As Yu Hong has shown, the welcome mat was extended in the 1990s to transnational capital in a number of export processing zones[6]: for instance, approved foreign companies were granted significant tax concessions on top of access to cheap labor.

Almost two decades have passed since World Trade Organization (WTO) accession and a decade since the Seventeenth NPC that saw the announcement of China’s soft power. As we discuss below, this announcement had a political legacy that predated Deng Xiaoping’s development mantra “socialism with Chinese characteristics” in 1992. The Eighteenth Congress, two decades later, saw the transition to a new leadership style, one reminiscent of both Mao Zedong and Deng Xiaoping, and the voicing of an alternative slogan—“cultural empowerment.”[7] The Nineteenth Congress in October 2017 provides a barometer of how this latter concept has developed and become embedded in the quest for the “great rejuvenation” of the Chinese nation.[8] Unsurprisingly, the issue of challenging the might of foreign media industries remains as topical as ever before. The key question that activates China’s media sector is, “How might we (i.e., in China) learn to be more internationally competitive?”

The intention of the article is to show the extent of internationalization among China’s leading digital communication enterprises and how the scope of their ventures provides a foundation for Chinese culture and media products to reach new markets, in doing so contributing to the “great rejuvenation.” The article shows that “going out” embodies at least three levels. The first refers to the going out of China’s products (i.e., media products and services); the second level is transmitting ideology; and the third level is Chinese organizations, people, and delegations (investment, study, travel). For the government, the second of these objectives—ideology—is the most important. For the digital companies, the goals are mostly economic; their strategy is not map-oriented nor is it ideologically determined; they follow their economic trajectories which allows them to go faster and longer, although this has consequences if they move faster than the government’s expectations. Like the massive ships of Admiral Zheng He, the Ming dynasty navigator, the government finds it hard to change its course. Whereas the government ultimately works in Five-Year Plans, the strategy of the digital enterprises is more flexible.

The article shows how and why the digital economy is taking Chinese culture further than ever before. The research framework is informed by “platformization,” which in relation to China’s emerging digital behemoths refers to their capability “to reformat the web according to the logic of social media”[9]: in other words, digital platforms are changing the way that cultural content is produced, distributed, shared, and consumed. We support our analysis with academic studies of China’s media internationalization and soft power campaigns, together with press accounts and industry data. We begin our journey, however, with the genesis of the concept of soft power in the People’s Republic of China (PRC). The following section describes the ascendency of three dominant internet companies, known colloquially as the “three kingdoms” or BAT: Baidu, Alibaba, and Tencent. Preceding this, we look briefly at Wanda, a dominant private company based in the northeast city of Dalian that has responded to the government’s call to take Chinese culture to the world and encountered some unexpected political turbulence.

The final section investigates how acquisitions and territorial expansion have entered into the “going out” equation. On the new western frontier, the BAT are competing for assets in Hollywood and other European centers. Deals are being made with leading international media companies; the quid pro quo in many cases is international access to the Chinese market. The eastern frontier encompasses the Asia-Pacific region and the One Belt One Road (OBOR) territories that were previously conduits for Chinese ideas during the Tang, Song, and Ming dynasties.[10] The OBOR brings land-based territories into the equation, from Xinjiang through the old Silk Road corridors to central Asia and beyond, as well as sea-facing territories in the Straits of Malacca such as Indonesia, Philippines, Singapore, and Malaysia. While the government’s current intention is to build infrastructure into these regions and thereby channel Chinese state-owned businesses to the region, a secondary purpose is to disseminate Chinese culture.

Having overseas digital platforms—both government-owned and privately owned—in place is a major advance over the past decade. The concluding section reexamines the question of competing interests. How far can the private companies reach while balancing the objectives of “serving the nation” and serving corporate shareholders?

Dreamscapes: Past and Present

The term “soft power” has appeared in many depictions of China’s political development over the past decade[11]; as we will show, it now has a direct relationship to the regional expansion of China’s media industries.[12] Most scholarly papers recognize the genesis of the concept, citing Joseph Nye Jr., the American political scientist who coined the term in 1990.[13] Nye said that the soft power of a country rests on three resources: a country’s culture, its political values, and its foreign policies. Although the initial take-up of the term within China can be attributed to the translation of Nye’s Bound to Lead in 1992, the sinisation of soft power embodies several traditional elements from the Warring States Period, notably Mencius’s moral concept of the “kingly way”[14] and the military strategist Sun Zi’s guides to subjugating the enemy without a fight. Wang and Lu contend that the Chinese conceptualization of soft power is much broader than the usage attributed to Nye in that it can refer to nations and organizations, as well as individuals.[15] Such a particularistic approach enables the state to nominate cultural organizations and individuals that exemplify Chinese culture.

While certainly activated by Nye’s intervention, the adoption of the term soft power in the PRC has an earlier legacy. In 1988, Zheng Bijian, a leading consultant in the Chinese Academy of Social Sciences (CASS), wrote that “Cultural strength is also a national capability and an extremely important component part of the “comprehensive national strength.”[16] the latter term referring to an amalgam of “strengths” including economic, political, and cultural. Athough the so-called Comprehensive National Strength debate died down due to fears that it was uncharacteristically bellicose, the concept of “cultural security” arose,[17] advocating greater state resources for cultural and media sectors to challenge westernization and cultural globalization. Informed by cultural security concerns, soft power surfaced in internal study sessions that involved senior Party-affiliated intellectuals.[18] President Hu Jintao attended several of these sessions. Hu was reportedly interested in how the use of the internet, referred to in internal documents as “China’s network culture,” might facilitate China’s soft power.

As this article shows, the rise of China’s digital communications industries in recent years has generated a hard edge to soft power, which under the Xi Jinping regime is designated as “cultural empowerment.” The question of empowerment resonates deeply among intellectual circles in China. The yearning for cultural rejuvenation and “cultural self-confidence” is a key element of the “Chinese Dream” proposed by Xi in 2013.[19] Despite the Chinese government’s attempts to hose down its global ambitions in the light of territorial expansion (see below), the Chinese dreamscape can be encapsulated in the idea When China Rules the World, the title of a book by the British Marxist, Martin Jacques. Unsurprisingly, this has been a bestseller in China, and Jacques is a honored guest on China’s state media.[20]

Digital Champions

The term “national champions” is often deployed by political scientists and economists when describing the internationalization of Chinese companies, particularly large state-owned enterprises. Since the mid-1990s, the Chinese government attempted to build “a team of globally competitive firms.”[21] The “going global strategy,” introduced in 2001,[22] has been primarily directed at national champions. The latter term, however, is rarely used in relation to China’s state-owned media companies such as China Central Television. We will argue that the internationalization of privately run digital media companies evokes the description “digital champions.” These companies have an allegiance to shareholders, as well as a responsibility to the state, which might be described as a “stakeholder.”

In the early 2000s, Chinese journalists drew attention to the “cultural trade deficit”[23] to describe the nation’s weak export earnings in cultural services. One external force was Hollywood and the ever-present threat of Western liberal ideology; the second force was the Korean Wave, the name given to the remarkable surge of South Korean film, television, and games industries in the late 1990s and early 2000s.[24] While less of an ideological threat than Hollywood, the Korean Wave had the effect of opening the floodgates of the kind of cool East Asian pop culture that many Chinese scholars deemed less authentic than China’s own traditional culture.

How would the nation combat these dual forces? The response was the marshaling of government resources to the cause of China’s culture “going out.” The formulation of a raft of policies from 2002 to 2005[25] was followed by Chinese companies seeking out offshore investment opportunities and claiming to be doing what the government had mandated. The Cultural Industry Rejuvenation Plan, legislated in 2009, saw an increase in China’s foreign investment in culture, sports, and entertainment—from RMB 19.76 million in 2009 to RMB 196.34 million in 2012.[26] Although these figures are relatively small in comparison with Hollywood, they do indicate an upward trajectory.

The unprecedented growth of the internet since the mid-2000s has changed the mode of going out: it allows Chinese media products to reach foreign audiences more effectively. At the same time, online media provide new ways for foreign media content to come into China—often circumventing firewalls thanks to virtual private networks (VPNs).[27] As the Chinese language internet has grown, more people around the world have become connected to its platforms. In 2008, English accounted for 427 million internet users. Chinese was then 233 million.[28] By 2017, however, the comparisons were strikingly different, with Chinese accounting for 771 million users (compared to English 985 million); moreover, with Chinese being the most spoken language in the world, this leaves considerable room for growth.[29] Digital literacy and globalization, combined with access to online worlds, is providing new platforms for Chinese ideas.

Does online activity contribute to the government’s “going out” campaign? This remains a point of contention. Reports of “massive” online distribution of Chinese TV drama lack evidence of the nationality of consumers. It is problematic to conflate online “hits” with global success: many such hits are recurrent visits, and the users are invariably native Chinese speakers.[30] This does not equate with “impact” among non-Chinese-speaking audiences. This problem is endemic to propaganda emanating from Beijing, noted in a recent chapter by the UK scholar Daya Thussu, in which the circulation of China Daily worldwide (based on government data) is reported as six hundred thousand with a massive forty-five million readers[31]; elsewhere in the same edited collection, Falk Hartig reflects on the widespread discrepancy of official circulation figures of China Daily, which range from two hundred thousand to four hundred thousand and even as high as nine hundred thousand.[32]

Evidently, a great deal of consumption now takes place on online platforms; in the future, consumption is more likely to be aggregated and understood demographically by big data. If the term “national champions” depicts China’s powerful state-owned enterprises, for instance, China Mobile and Sinopec, “digital champions” can be best typified by BAT.[33] BAT are akin to digital capitalists, to draw on Yu Hong’s depiction of the evolving corporate nature of communication technology sector in China—a state-led model that “contends, collaborates, and overlaps with the US-dominated system of global digital capitalism.”[34] As Jia and Winseck point out, the political economy of BAT is underscored by links to Silicon Valley investors.[35] In an earlier writing, Yuezhi Zhao used the description “between the party line and the bottom line” to characterize the nature of collaboration between government, communications companies in China, and transnational corporate interests.[36] “Contending” enhances the status of these companies as national champions; “collaborating,” on the contrary, entails navigating a delicate course between being too close to Western capitalists and too close to the Chinese propaganda machine.

Before addressing the question of how BAT connect to audiences and enhance China’s culture “going out,” it is worth reflecting on their core businesses. Baidu (B), with headquarters in Beijing, is fundamentally a search engine, sometimes called China’s Google. It has a range of additional interests, including artificial intelligence (AI), autonomous vehicles, app development, online video, music, and cloud computing. Alibaba (A), a Hangzhou-based company, is an e-commerce colossus with massive investment in electronic payment systems, block chain technology, AI, and cloud computing, as well as significant investment in digital media and entertainment. Tencent (T), headquartered in the southern city of Shenzhen, is the world’s largest instant communications empire. It has interests in media entertainment, mobile games, smartphones, and electronic payment systems.

Unsurprisingly, the industry leaders of BAT have validated their companies’ ambitions in line with China’s “going out.” Their success has been aided by a combination of industry protectionism and national security provisions, which has restricted or retarded the entry of powerful foreign forces like Google, YouTube, Amazon, Apple, and Facebook while providing incentives for Chinese companies to recruit talent from overseas. BAT have the capacity to dominate the domestic market while reaching beyond China’s borders, utilizing a unique Chinese mode of “platform capitalism.” The term platform, as used by Nick Srnicek, refers to the emergence of a business model, “capable of extracting and controlling immense amounts of data.”[37] In this understanding, platforms transcend internet companies or tech companies—they operate wherever digital interaction takes place. Many well-known social media sites are now conceptualized as “platforms.” The platform metaphor is evident in the idea of convergence—from a media industry legacy to embodiment in the computing industry, a process which is reformatting the web and allowing “users” greater freedom to select how they consume.[38]

The business models of platform capitalists are different from the traditional vertically or horizontally integrated communications conglomerates that have featured heavily in political economy of the media. Knowing what people are doing, watching, and sharing online would seem to provide an advantage in the content industries, especially when one owns the most popular online distribution channels. In fact, the digital economy, recognized in the state’s 2015 Internet Plus blueprint,[39] holds the key to further prosperity in China according to the Party propaganda machine. Platformization—the combination of data storage in the cloud, streaming services, and the Internet of Things and the linking of social media applications with the affordances of the sharing economy—will assist China’s businesses to compete and internationalize.

The intervention of these companies into sectors previously monopolized by traditional media underlines the key argument of this article—they are obliged to service the call of government as much as their shareholders, or to put it another way, government wants to be a shareholder in the BAT.[40] These emergent Chinese digital champions, along with Wanda, the ostensibly real estate company that sidelines in film production and film studio procurement, constitute a different modality of technological upgrading than the previous decades (1990s and 2000s) when the focus was squarely on the development of technology networks, telecoms, and software industries.[41]

In some ways, Dalian Wanda is the odd man out; its core business is real estate, not media; however, the company has aspirations to become a player, leveraging on its accumulated assets in the entertainment industries. CEO Wang Jianlin became enamored with the prospects of the media and cultural sector, in part because it offered an alternative different business model to real estate, plus it had the added bonus of responding to the government’s call for cultural empowerment. In his book The Wanda Way, Wang writes,

In a speech made in February 2012 at the Wanda Institute, Wang pointed to his ambitions to develop Wanda into a “global brand.”[43]

Cultural investments include Wanda’s acquisition of the movie theater exhibition chains, such as AMC Theater Multiplex in North America (2012), Hoyts in Australia (2015), ODEON and UCI in Europe (2016), and the Carmike cinema chain in the United States (2016).[44] Wanda’s geographical diverse theatrical distribution of real estate augurs well for the international release of Chinese films, which has been a stumbling block for the industry, aside from screenings in film festivals. The company then bought Legendary Pictures, a major Hollywood company. Michael Curtin writes that

In short, in answering the call to “go out,” Wanda had provided a pathway for others to follow. The next wave saw the rise of the “three kingdoms.”

In the past few years, BAT have shown an interest in competing for the spoils of the cultural market, especially in the kind of content that appeals to younger urban demographics. The question of why these companies have chosen to compete for the spoils of the cultural sector where the party-state has a visible presence is multifaceted. Their entry is hardly surprising, when one considers how and why their Western counterparts, Google, Amazon, Apple, and co., have targeted the content industries. While the western Silicon Valley entities, sometimes glossed as N-Cal (Northern California), have thrown out an industrial challenge to Hollywood (S-Cal), they have yet to demonstrate the kind of creative edge that has made S-Cal/Hollywood so successful.[46]

The domestic assets of BAT in the audiovisual sectors are best captured in three dominant online platforms: iQIYI, Youku Tudou, and Tencent Video. The first of the entities, iQIYI, is an online entertainment distribution platform. iQIYI is intent on forming a video business chain, in which everything appearing in the video will be available to purchase within one click. The pioneer in the online video sphere in China, Youku Tudou, combines professionally generated content (PGC), user-generated content (UGC), and self-made content. After its majority shareholding was acquired by the Alibaba group in 2012, Youku Tudou was able to set up China’s largest video search engine—Souku—while having China’s largest e-commerce company as its parent company.[47] In 2018, Alibaba acquired 7.66 percent stake in the downsizing Wanda conglomerate, a move that strengthens Alibaba’s online cinema ticketing operation, Taopiaopiao.[48] Tencent video is fast emerging as a contender thanks to the massive number of active WeChat users. With significant overseas collaborative partnerships, it is establishing a super-media platform that will lead it to the top of the pyramid. As we describe below, the BAT and their subsidiary companies are extending their forces into peripheral regions.

Understanding the Territorial Outreach of China’s Platforms

The capacity of China’s digital platform to extend beyond the Chinese mainland is empowering “digital champions.” Hardly a week goes by without reading of some new venture in the trade presses. The question remains, “Does such capitalist activity constitute “going out” in the sense recognized by the party-state?” In this section, we delve deeper into their “cultural turn,” keeping in mind the penchant for aggressive competitive behavior, which is more akin to bourgeois capitalism than “socialism with Chinese characteristics”; however, the latter is defined. The chart below details the key strategic acquisitions by BAT within the Mainland since 2012, as well as noting outward bound activities that have a bearing on China’s media presence in the world and in the Asia-Pacific region. Of course, these emerging partnerships are increasing Chinese audiences’ access to global content, although it is important to emphasize that all content is now vetted directly by the Publicity Department of the Chinese Communist Party.

The investment in and partnerships with foreign film and television entities described in Table 1 reveal a strategic development imperative. The question raised in the introduction can now be addressed: How might Chinese media and communications companies learn to be more internationally competitive?

Producing content for world audiences involves narrative approaches that are different than those utilized within the PRC. This mode of international engagement entails a certain amount of risk. Overseas “partners” working in China regularly draw attention to the lack of narrative sophistication in mainland Chinese content, at least in relation to Hollywood.[62] Alternatively, buying up overseas assets fosters transfer of expertise and know-how; for instance, the acquisition of foreign studios brings legacy assets including brand awareness. The expansion of Chinese media companies in Hong Kong, in particular, has led to a migration of technical and creative expertise to the mainland.[63]

Coproduction provides another tentative step forward; in December 2016, Sony Pictures announced that it would coproduce a mandarin language adaptation of the successful US action-thriller television series Chosen (2013–14). The deal was struck with iQIYI to deliver a three-part online drama, eventually released in January 2018, with the provision that it would be available on Netflix later in 2018. Netflix’s initial foray with Chinese content was the reformatting of iQIYI’s Qing dynasty costume drama Empresses in the Palace in 2015. The seventy-six-episode blockbuster was condensed into six subtitled episodes each of ninety minutes. Although its international reception on Netflix was far from a success, it did at least show that Chinese content could be made available on Western platforms, with some reformatting to accommodate foreign viewing tastes. The fact of the matter, however, is that the core audience for such culturally specific costume dramas are native Chinese or at least people with deep understandings of Chinese history. Most of them would have viewed the series, already subtitled in full on iQIYI’s existing overseas platforms, accessible by DVD, satellite, or TV-Pad subscriptions.

Alibaba’s foray into the content sector is a strategy both to compete with its domestic competitors and to consolidate its brand with a younger audience. Acquiring the video site Youku Tudou, as well as having a controlling interest in Sina, has allowed Jack Ma, Alibaba’s executive chairman, to present himself as a champion of Chinese culture. Ma has even cast himself in a short movie called Gong Shou Dao (literally “the way of keeping work”) that is, according to Ma, intended to showcase Chinese traditional culture. The venture by Alibaba into the film and content sector brings Alibaba’s crowdfunding entity Yulebao[64] into play while featuring self-promotion of its content on Youku Tudou. Alibaba’s acquisition of the Hong Kong based “quality” newspaper, The South China Morning Post, in 2016 has both rejuvenated the company but also positioned it as a carrier of mainland Chinese values, much to the consternation of many in Hong Kong.[65] Meanwhile, Tencent’s international ambitions are largely based on the online games and its instant messaging site WeChat.

Elsewhere, the OBOR territories offer the prospect of further expansion. State-owned enterprises are following the government’s agenda, laying the infrastructure and establishing the base. The government believes that this physical infrastructure will accommodate cultural traffic, for instance, more Confucius Institutes, more TV channels, more cultural theme parks, and more museums. Already Alibaba has moved to extend its e-commerce coverage along the OBOR. According to its estimates, 45 percent of the users of Alipay, its online payment system, are situated in OBOR territories including India, Thailand, Indonesia, and the Philippines.[66] It has established warehouses to speed up transportation through its logistic system as well as having cloud infrastructure services in Singapore and Dubai. Alibaba’s e-commerce presence in these territories provides residents and consumers with high-quality products. In addition to having access to the e-commerce platform, consumers may well become habituated to visiting digital content platforms such as Youku Tudou that increasingly celebrate an Asia “harmoniously” integrated with China.

The colonization of the region makes sense in many respects; it follows the national plan. However, populations along the OBOR, for instance, those in Central Asia and the subcontinent, are far more culturally diverse than the enclaves of Chinese viewers in the Asia-Pacific. Korean TV dramas have made deeper inroads than Chinese serials in Thailand, whereas Indian and Pakistan dramas are more attuned to Bollywood than Beijing. The aim of the OBOR strategy so far is infrastructural, finding a way to release excess industrial capacity in iron, steel, and concrete; building roads, bridges, and hospitals; and laying cable.

Concluding Remarks

In the introduction, we identified three key levels of cultural traffic: cultural products and services, ideology, and the physical movement of human capital. If we consider the first level, products, and services, online platforms such as Youku Tudou, iQIYI, and WeChat/Tencent Videos carry a modern playlist of rich Chinese content to the world. Ideology exists in these commercialized media products of course but far less than what one finds on China Global Network TV (CGTN), the official online platform. Other developments reflect latent nationalism: it is uplifting for many Chinese nationals living outside the PRC to see fresh innovative forms of modern television or to watch Chinese films in Wanda’s “China-owned” cinemas. However, the strategy remains fundamentally ethnocentric because it aggregates Chinese-speaking audiences. Viewers and users are predominantly resident in the Asia-Pacific.

Chinese television, for instance, is concentrated in certain markets: the United States, Canada, Singapore, Hong Kong, and Taiwan.[67] Programs are readily accessible on platforms, such as the Asian content-streaming site Viki, which is headquartered in San Francisco, or through digital subscription services using set-top boxes (modems). In Singapore, selected Chinese dramas and variety content are found on free-to-air channels such as MediaCorp Channel 8 and Channel U or on Toggle.sg, a freemium over-the-top (OTT) service related to MediaCorp. In addition, pay-TV channels from China such as Shen Zhou TV, CCTV4, Dragon TV, and NOW are available via subscription services bundled by Starhub or Singtel. Other dedicated streaming platform choices include Viu, iflix, and Netflix.

In effect, consumption of Chinese culture outside the mainland combines new and older forms of media and a variety of access points. State data on official sales of Chinese television programs from 2008 to 2016 clearly show the challenges of breaking into non-Asian markets. The Taiwanese market, where Mandarin is spoken, remains the strongest performer; more recently, there has been growth in Japan and South Korea. But European, African, and US markets have not shown growth: between 2008 and 2016, sales of TV programs (all genres) to Europe remained low, as was the case in US and African markets.[68] Most growth occurred in Taiwan, Hong Kong, and South Korea.[69] TV drama sales have constituted the bulk of the market.

South and East Asia therefore hold the most hope for China’s cultural empowerment strategy. The region is home to many people of Chinese origin, many of whom are likely to feel some sense of pride in seeing Chinese culture expand, even if they hold diverging views about China’s political leadership and geopolitical footprints in the region. Moreover, in regard to investment, collaborating with persons of Chinese heritage, the so-called hidden dragons,[70] may yet be the best way forward. In the film industries, for instance, the bulk of the development, financial, investment, and human capital is coming from the East Asian region.[71]

In the introduction, we also characterized the Chinese state apparatus as a slow-moving ship, referencing the massive “treasure vessels” used by the famed Ming dynasty navigator Zheng He during his many seagoing voyages. The traffic was basically one way, although Chinese culture, customs, and artifacts did spread to new territories. The treasure ship metaphor can now be revised to factor in the speed of modern communications. Rather than a slow-moving ship laden with treasure and tributes, the state apparatus is reimagined as a mothership, that is, a large vehicle like an aircraft carrier or a spacecraft that transports other smaller ones. CGTN, for instance, is the designated mothership, following in the wake of its predecessor CCTV International, Xinhua News service, and the many human-centered cultural emissaries—Confucius Institutes, performing arts troupes, delegations, and conferences.

Fast-moving commercial digital companies are “going out,” seeking virtual treasures, mostly for their shareholders, although they are required to “pay back” the government for its support. Yukon Huang, author of Cracking the China Conundrum, says that the economy in China is not about firms but about state–firm relations, including local and regional governments.[72] The political scientist, David Kelly, puts a finer point on this, suggesting that the term “private,” as exemplified by the new breed of entrepreneurs, should be described as “less state.”[73] Dalian Wanda’s acquisition of AMC, for example, which required US$3.1 billion would not have been possible without the support of state banks in China.[74] If these companies overreach, as the Wanda Group has done, they run the risk of incurring the wrath of the command center, the Chinese Communist Party.

Are BAT followers or pioneers? The article began by asking, “Whose interests are they serving?” One answer, based on their market performance, is that these companies are prototypical capitalist entities. While each has its own core business, in an era of convergence, there are inevitable turf battles. Aside from iQIYI, Baidu is looking the least likely to achieve internationalization; Alibaba’s massive e-commerce business is augmented by its cultural ambitions and its investment in film production; Tencent is empowered by the ubiquity of the mobile internet and its strengths in gaming. Of course, the government wants to ride on the success of these companies because the commercial digital platforms are outperforming the state’s cultural power emissaries. Yet, the commercial digital companies are not defined by the state’s internationalizing agendas: they are aligned as far as it is necessary. As Jack Ma, the founder and former CEO of Alibaba, said about his relationship with government, “it’s okay to be in love with them, but don’t marry them.”[75]

1. Research for this article was funded through the Australian Research Council Discovery Project (DP170102176), titled Digital China: From Cultural Presence to Innovative Nation.

2. Michael Keane is Professor of Chinese Media and Program Leader of the Digital China Lab at Curtin University. His key research interests are digital transformation in China, East Asian cultural and media policy, and creative industries and cultural export strategies in China and East Asia. Huan Wu is a Researcher in the Centre for Culture and Technology, Curtin University. She researches Chinese creative industries and the interaction between digital technologies and disadvantaged populations (i.e., older adults and people with disability). She is the author of Virtual Community and Social Capital of Older Adults (Shanghai Jiaotong Univ. Press).

3. The term used for soft power is ruanshili.

4. Sometimes referred to as “go global” or “go to the world,” zou chuqu.

5. The term used was qing jinglai; see Peter Nolan, Is China Buying the World? (Cambridge: Polity Press, 2012).

6. Yu Hong, Networking China: The Digital Transformation of the Chinese Economy (Urbana: University of Illinois Press, 2017).

7. “Cultural empowerment” or “the great cultural power” is wenhua qiangguo.

8. Known in Chinese as weida fuxing.

9. Anne Helmond, “The Platformization of the Web: Making Web Data Platform Ready,” Social Media & Society 1 (2, 2015): 1–11, doi:10.1177/2056305115603080.

10. The One Belt One Road (OBOR) initiative is sometimes called the Belt and Road Initiative. It is a signature policy of Xi Jinping and aims to connect China with Europe through the territories formerly known as the Silk Road as well as the sea routes through the Malacca Straits. See Peter Cai, Understanding China’s Belt and Road Initiative (Sydney: Lowy Institute, March 2017), https://www.lowyinstitute.org/sites/default/files/documents/
    Understanding%20China%E2%80%99s%20Belt%20and%20Road%20Initiative_WEB_1.pdf.

11. For discussion, see Hongying Wang and Yeh-Chung Lu, “The Conception of Soft Power and Its Policy Implications: A Comparative Study of China and Taiwan,” Journal of Contemporary China 56 (17, 2008): 425–47; Naren Chitty et al., eds. The Routledge Handbook of Soft Power (London: Routledge, 2017); Wanning Sun, “Slow Boat from China: Public Discourses about the ‘Going Out’ Policy,” International Journal of Cultural Policy 21 (4, 2015): 400–18; Antonio Vlassis, “Soft Power, Global Governance of Cultural Industries and Rising Powers: The Case of China,” International Journal of Cultural Policy 22 (4, 2015): 481–96, doi:10.1080/10286632.2014.1002487.

12. See Wuwei Li, “The Challenges of China’s Culture ‘Going to the World’,” in The Handbook of the Cultural and Creative Industries in China, ed. Michael Keane (Cheltenham: Edward Elgar, 2016), 116–28; and Huailiang, Li, “Chinese Culture ‘Going Out’: An Overview of Government Policies and an Analysis of Challenges and Opportunities for International Collaboration,” in The Handbook of the Cultural and Creative Industries in China, ed. Michael Keane (Cheltenham: Edward Elgar, 2016), 129–42.

13. Joseph S. Nye Jr., Bound to Lead: The Changing Nature of American Power (NY: Basic Books, 1990).

14. Qianjin Qi, “US Soft Power Declines Rapidly” [Meiguo Ruanshili Jixu Hualuo], Outlook Weekly/Liaowang Xinwen Zhoukan, July 19, 2004, pp. 116–28, 46–48.

15. Wang and Lu, “The Conception of Soft Power and Its Policy Implications.”

16. See Bijian Zheng, China’s Road to Peaceful Rise (London: Routledge, 2011), 20130301. VitalBook file. The term commonly used for “comprensive nation strength” (or power) is zonghe guoli (综合国力).

17. Cultural security, wenhua anquan (文化安全), began to figure prominently in debates as China entered the World Trade Organization (WTO) in 2001. For a discussion, see Michael Keane, Creative Industries in China: Art, Design, and Media (Cambridge: Polity, 2013), 28–33.

18. Weihong Zhang, “China’s Cultural Future: From Soft Power to Comprehensive National Power,” International Journal of Cultural Policy 16 (4, 2010): 383–402, 386.

19. Cultural self-confidence, wenhua zixin, constitutes one of the components of the Chinese Dream, Zhongguo meng of national rejuvenation.

20. Martin Jacques, When China Ruled the World: The Rise of the Middle Kingdom and the End of the Western World (London: Penguin, Allen Lane, 2009).

21. Peter Nolan, Is China Buying the World? (Cambridge: Polity, 2012).

22. Huiyao Wang and Lu Miao, China Goes Global: How China’s Overseas Investment is Transforming Its Business Enterprises (Basingstoke: Palgrave Macmillan, 2016).

23. Keane, Creative Industries in China: Art, Design and Media (Cambridge: Polity, 2013), 31.

24. Dal Yong Jin, New Korean Wave: Transnational Cultural Power in the Age of Social Media (Chicago: University of Illinois Press, 2016); Doobo Shim, “Hybridity and the Rise of Korean Popular Culture in Asia,” Media, Culture & Society 28 (1, 2006): 25–44.

25. Li, “Chinese Culture ‘Going Out’.”

26. Ibid., 1. In Chinese, wenhua chanye zhenxing guihua.

27. The number of virtual private networks (VPNs) operating in China is hard to quantify as it is deemed illegal. Some sources estimate the number to be over 200 million; others much less.

28. These data here do not specify whether this is Mandarin only. See Jacques, When China Ruled the World, 380: source cited is “China Soon to be the World’s Biggest Internet User’,” Guardian, January 25, 2007.

29. Data based on InternetWorldStats.com, “Internet World Users by Language.”

30. Hugo de Burgh, China’s Media in the Emerging World Order (Buckingham: University of Buckingham Press, 2017). Such claims about viral online success, measured in “hits,” does not translate into impact in non-Chinese-speaking audiences. A case is the TV serial Nirvana on Fire, which reportedly received 3.3 billion hits. See Huifeng He, “Legend of Miyue Smashes Online Video Viewing Record in China with 700 million Hits in 24 hours as Country Sees Industry Take Off.” South China Morning Post, 3 December, 2015. http://www.scmp.com/tech/enterprises/article/1886420/legend-miyue-smashes-online-video-viewing-record-china-700-million.

31. Daya Thussu, “Globalization of China’s Media: the Global Context,” in China’s Media Go Global, ed. Daya Thussu, Hugo de Burgh, and Anbin Shi (London: Routledge, 2017), 18.

32. Falk Hartig, “China Daily: China’s Global Voice?” in China’s Media Go Global, ed. Daya Thussu, Hugo de Burgh, and Anbin Shi (London: Routledge, 2017), 125, 128.

33. The term “national champions” been applied to Baidu, Alibaba, and Tencent (BAT). See “China Recruits Baidu, Alibaba and Tencent to National AI team” http://www.scmp.com/tech/china-tech/article/2120913/china-recruits-baidu-alibaba-and-tencent-ai-national-team.

34. Hong, Networking China.

35. Lianrui Jia and Dwayne Winseck, “The Political Economy of Chinese Internet Companies: Financialization, Concentration, and Capitalization.” The International Communication Gazette 80 (1, 2018): 30–59. doi:10.1177/1748048517742783

36. See Yuezhi Zhao, Media, Market and Democracy in China: Between the Party-line and the Bottom Line (Chicago: University of Illinois Press, 1998).

37. Nick Srnicek, Platform Capitalism (London: Polity Press, 2017).

38. Helmond, “The Platformization of the Web,” 2.

39. The aims are

    “to integrate mobile Internet, cloud computing big data, and the Internet of Things with modern manufacturing, to encourage the healthy development of e-commerce, industrial networks, and Internet banking, and to get Internet-based companies to increase their presence in the international market.” (“China Unveils Internet Plus Action Plan to Fuel Growth. ” China Daily 4 April, 2015, http://www.chinadaily.com.cn/business/tech/2015-07/04/content_21181256.htm

    

40. In 2017, the government initiated moves to claim a minor shareholder stake in private internet companies. See https://www.nytimes.com/2017/10/13/business/china-online-stakes-control.html.

41. Yu Zhou, “Time and Spaces of China’s ICT Industry,” in The Economic Geography of the IT Industry in the Asia Pacific Region, ed. Philip Cooke, Glen Searle, and Kevin O’Connor (Abingdon: Routledge, 2013), 68–85. Xuelin Liu and Jianghua Zhou, “China’s Catch-up and Innovation Model in the IT Industry,” in The Economic Geography of the IT Industry in the Asia Pacific Region, ed. Philip Cooke, Glen Searle, and Kevin O’Connor (Abingdon: Routledge, 2013), 144–68.

42. Jianlin Wang, The Wanda Way: The Managerial Philosophy and Values of One of China’s Largest Companies (London: LID Publishing, 2016), 187.

43. Ibid., 179.

44. Jeremy Kay, “Dalian Wanda Group Completes AMC Acquisition for $2.6bn,” Screen Daily, September 4, 2012, http://www.screendaily.com/dalian-wanda-group-completes-amc-acquisition-for-26bn/5046096.article.

45. Michael Curtin, “The New Geography of the Global Blockbuster: Wanda Scales Up,” in Willing Collaborators: Foreign Partners in Chinese Media ed. Michael Keane, Brian Yecies, and Terry Flew (London: Rowman & Littlefield International, 2018), 39.

46. For a discussion of the N/Cal S/Cal divide, see Stuart Cunningham and David Craig, “Online Entertainment: A New Wave of Media Globalization?” International Journal of Communication 10 (2016): 5409–25.

47. Michael Keane and Chunmeizi Su, “The Will to Power: the BAT in and Beyond China,” in Willing Collaborators: Foreign Partners in Chinese Media, ed. Michael Keane, Brian Yecies, and Terry Flew (London: Rowman & Littlefield International, 2018), 47–62.

48. Pang-chieh Ho, “Alibaba Acquires Stake in Wanda Film as the Entertainment Conglomerate Scales Back on Debt,” Technode, February 6, 2018, http://technode.com/2018/02/06/alibaba-wanda-film/.

49. “Zongheng Literature Announced the Completion of a New Round of Financing,” (Zongheng wenxue xuanbu wancheng xinyilun rongzi). Zongheng.com, May 26, 2017, http://news.zongheng.com/news/5419.html.

50. Patrick Frater, “China’s iQIYI Signs Expanded Content Deal with Universal Pictures.” Variety. Com, October 21, 2015. http://variety.com/2015/digital/asia/chinas-iqiyi-signs-expanded-content-deal-with-universal-1201623860/.

51. Dave McNary, “Lionsgate Extends Streaming Deal with China’s iQiyi Platform.” Variety. Com, November 29, 2016, http://variety.com/2016/digital/asia/lionsgate-extends-streaming-deal-china-iqiyi-1201928179/.

52. Todd Spangler, “20th Century Fox Inks Exclusive Output Deal With China’s iQIYI.” Variety. Com, January 27, 2016, http://variety.com/2016/digital/asia/20th-century-fox-inks-exclusive-output-deal-with-chinas-iqiyi-1201689973/.

53. “The Bundesliga and Baidu--one of China’s leading Internet groups – become partners.” Bundesliga. Com, February 28, 2017, https://www.bundesliga.com/en/news/Bundesliga/agmdsp-bundesliga-and-baidu-become-partners-435118.jsp.

54. Patrick Frater, “Warner Bros. Strikes Streaming Deal with China’s iQIYI.” Variety.Com, March 21, 2017, http://variety.com/2017/digital/asia/warner-bros-streaming-deal-with-china-iqiyi-1202012901/.

55. Michael Merced, “Alibaba Buys a Stake in China’s Twitter,” nytimes.com, April 29, 2013, https://dealbook.nytimes.com/2013/04/29/alibaba-buys-stake-in-sina-weibo-a-chinese-answer-to-twitter/.

56. SC Yeung, “What Alibaba-TVB Tieup Means for Hong Kong Viewers,” Ejinsight.com, June 18, 2015, http://www.ejinsight.com/20150618-what-alibaba-tvb-tie-means-hk-viewers/.

57. Chung-yan Chow, “Alibaba Buys South China Morning Post Groups Media Business and Pledges to Uphold Editorial Independence and Remove Pay,” South China Morning Post, last modified August 29, 2016, http://www.scmp.com/business/companies/article/1890060/alibaba-buys-south-china-morning-post-groups-media-business.

58. Patrick Frater, “Alibaba Complete $4 Billion Takeover of Youku,” Variety, April 5, 2016, http://variety.com/2016/biz/asia/alibaba-completes-youku-tudou-takeover-1201746908/.

59. Ben Jiang, “Tencent Invests US$63 Million into KakaoTalk, the Korean WeChat,” Technode, May 17, 2012, http://technode.com/2012/05/17/tencent-invests-us63m-into-kakaotalk-the-korean-wechat/.

60. Lisa Hanson, “Garena and Tencent Shine a Light on Southeast Asia’s Booming Digital Games Market,” Forbes, March 27, 2015, https://www.forbes.com/sites/lisachanson/2015/03/27/garena-and-tencent-shine-a-light-on-southeast-asias-booming-digital-games-market/#57bf4b244779.

61. Zen Soo, “Tencent Teams Up with Thai Startup Ookbee to Launch Content Platform,” South China Morning Post, January 4, 2017, http://www.scmp.com/tech/article/2059323/tencent-teams-thai-start-ookbee-launch-content-platform.

62. See interview with Chris Scott from Digital Domain, http://chinafilminsider.com/scott-ross-beijing-china-making-bigmistakes/

63. Danjing Joy Zhang and Michael Keane, “Creative Migration: Talent and Celebrity Movements to the Chinese Mainland,” in Willing Collaborators: Foreign Partners in Chinese Media, ed. Michael Keane, Brian Yecies, and Terry Flew (London: Rowman & Littlefield International, 2018), 213–226.

64. Yulebao in Chinese is 娱乐宝.

65. Javier C. Hernandez, “A Hong Kong Newspaper on a Mission to Promote China’s Soft Power.” The New York Times, March 31, 2018, https://www.nytimes.com/2018/03/31/world/asia/south-china-morning-post-hong-kong-alibaba.html

66. “E-commerce Goes Ahead in One-Belt-One-Road Initiative, Alibaba Released ‘Online Silk Road Big Data Report’.” China Economic Net, April 21, 2017, http://www.ce.cn/xwzx/gnsz/gdxw/201704/21/t20170421_22219354.shtml.

67. Li, “Chinese Culture ‘Going Out’.”

68. In 2008, sales of TV programs in Europe were US$2.53 million, in the United States US$1.64 million, and in Africa US$0.41 million. In 2016, the numbers were US$2.90, US$2.03, and US$0.36 million, respectively. Source: http://www.stats.gov.cn/tjsj/ndsj/2017/indexch.htm; Michael Keane, The Chinese Television Industry (London: Palgrave 2015), 70–71.

69. In 2012, sales in Taiwan were US$9.32 million, in Hong Kong US$3.49 million, in Japan US$1.70 million, and in Korea US$2.23 million. In 2016, the respective sales were US$13.48, US$8.01, US$8.12, and US$3.3 million. Source: http://www.stats.gov.cn/tjsj/ndsj/2017/indexch.htm; Keane, The Chinese Television Industry, 70–71.

70. Douglas B. Fuller, Paper Tigers, Hidden Dragons: Firms and the Political Economy of China’s Technological Development (Oxford: Oxford University Press, 2016).

71. For a full discussion see Willing Collaborators: Foreign Partners in Chinese Media edited by Michael Keane, Brian Yecies & Terry Flew. (London: Rowman and Littlefield International, 2018).

72. Yukon Huang, Cracking the China Conundrum (NY: Oxford University Press, 2017).

73. David Kelly, “Reining in the Red Entrepreneurs,” East Asia Forum, January 28, 2018, http://www.eastasiaforum.org/2018/01/26/reining-in-red-entrepreneurs/.

74. Ibid., 1.

75. Shujie Leng, “‘Be in Love With Them, But Don’t Marry Them,” Foreign Policy, October 31, 2014, http://foreignpolicy.com/2014/10/31/be-in-love-with-them-but-dont-marry-them/.

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