Innocent BenjaminChinese Internet giant, Alibaba, are being pressured to sell part of their stakes in media companies, according to reports from credible sources. Beijing is concerned about the company’s influence on social opinion in the country, reports America’s biggest newspaper, Wall Street Journal, citing information from ‘insiders’.
Representatives of the state were appalled by the amount of foothold they had in the media and have demanded that the company submit a plan to significantly reduce them. According to these insiders, this plan must be approved by the highest government agency.
Following this scrutiny, Alibaba shares in New York trading displayed price losses of about two percent.
Alibaba declined to comment on discussions with authorities about possible stake sales at the newspaper’s request and the Communist Party’s propaganda department also refused to respond to a written request from the media house. Alibaba described itself as a passive investor with a view to media holdings, but this investments pose a threat to China’s incumbent Communist Party and their intended propaganda, WSJ stated.
Alibaba Might Incur Heavy Fines
According to the report, the supervisory authority responsible for the strictly regulated Chinese Internet had already expressed criticism last May after Alibaba removed critical comments about a leading employee from its own platform.
The Wall Street further reported that government officials made it clear in a report that public opinion on all media platforms should be controlled by the Communist Party and not private companies as in democratic countries.
In addition to its core online trading business, the Alibaba Group has an enviable lineup of holdings with the most notable being the Weibo short message service, which is one of the biggest social media platforms in the country.
It also boasts shareholding stakes in other online and print media such as Hong Kong-based English-language newspaper South China Morning Post. The group is also active in the entertainment sector with the Alibaba Pictures Group.
But according to the WSJ, Alibaba’s trading business is also being followed with eagle eyes by the government. The Chinese antitrust authorities wanted to impose a record fine of almost a billion dollars on the company with new allegations accusing Ababa of hindering competition on its trading platform. The practice, according to the authorities, has seen Alibaba allegedly ban its dealers from selling their products on other platforms and is purported to be ended by the communist regime.
Most recently, Alibaba founder Jack Ma disappeared from the public for 87 days, inciting fears of a possible federal abduction, but then reappeared with words of praise for the government. He also appeared in a video, where he vowed to exert himself more to combat poverty in the future.
His woes had begun when he fired expletives at the government’s handling of financial institutions, which didn’t go down well with the hawkish communist party.
Amid the prying eyes of authorities on his investments, Jack Ma’s misery was compounded few weeks ago when he lost his title as China’s richest man for the first time in three years.
James steller
