The Chinese Communist Party is concerned that Alibaba’s media group has too much influence and has asked Alibaba to get rid of the media assets it controls, US media said, citing people familiar with the matter.
The e-commerce giant, founded by Jack Ma, has been under intense scrutiny by Chinese regulators since December, and Ma himself has seemingly “evaporated” during that Time, as the world has been watching with great interest how the Communist Party will “fix” Ali.
The Wall Street Journal reported exclusively on March 15 that according to an official source, top Chinese officials are “alarmed” by the sheer size of Alibaba’s media and have asked Alibaba to come up with a plan on how to drastically reduce its media assets.
These discussions have reportedly been underway since the beginning of this year, when Chinese regulators began scrutinizing Alibaba.
In addition to its main e-commerce business, Alibaba has also been deeply involved in media organizations for years, with investments covering paper, broadcast, digital and social media.
For example, Alibaba holds a 30% stake in Weibo, with 15.8% of the voting rights, and is the second largest shareholder of Weibo. in December 2015, Jack Ma spent about 2 billion yuan to acquire the South China Morning Post. Ali is also involved in Youku, Mango Supermedia, Fun Headlines, Weibo, B Station, Xiaohongshu, etc.
Ali’s huge influence on public opinion poses a “serious challenge” to the Chinese Communist Party and its powerful propaganda apparatus, sources said, putting a demand for Ali to get rid of its media assets on the agenda.
Alibaba would not comment on whether the Communist Party’s regulators have asked it to shed its media assets. But the company said in a statement that its media assets are “passive financial investments.
Last Thursday, the Wall Street Journal reported that the Communist Party’s antitrust regulator is considering imposing a record fine on Alibaba for “anti-competitive behavior,” which could reportedly be the highest monopoly fine ever levied by the Communist Party, citing sources familiar with the matter.
Last November, Ali’s Ant Group’s planned initial public offering (IPO) was called off in an emergency. Prior to that, Ma had criticized the role of the CCP’s financial regulator in public forums, going toe-to-toe with Wang Qishan, which reportedly infuriated the highest levels of the CCP.
Last December, the CCP’s State Administration of Market Supervision and Administration announced the launch of an anti-monopoly investigation into Alibaba.