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Jack Ma’s stormy retirement days: Making Alibaba face the most severe ‘survival crisis’ in history over 20 years, forced to ‘disappear’ mysterious

This year may be the toughest year for Alibaba since its inception two decades ago.

The famous Chinese tech company is currently facing a series of challenges both at home and abroad, which can put them at risk of change forever. Specifically, the Chinese authorities are investigating the company for monopoly allegations as part of the increasingly intense sanctions on the tech industry. Not to mention, Ant Group – the financial arm of this group is also facing an overhaul of its business segment.

The Washington side can also pose a threat. While the Trump administration is said to have supported a proposal to ban Americans from investing in Alibaba and two other well-known tech companies, the US-China tensions may not be over anytime soon.

Finally, the company’s spiritual leader, co-founder and former chairman Jack Ma hasn’t been in the media for months.

“Alibaba – like all major Chinese tech companies are facing an existential crisis,” said Alex Capri, an analyst at National University of Singapore.

Pressure in the water

Capri points to the growing tightening of the Chinese regime as a particular concern for Alibaba and companies like them.

President Xi Jinping is urging officials to redirect the role of domestic technology companies. Last month, Mr. Xi stated that efforts to prevent antitrust against online platforms will be one of the most important targets in 2021. Antitrust investigation targets Alibaba and other companies Another has emphasized that priority.

Jack Ma s stormy retirement days Making Alibaba face the most severe survival crisis in history over 20 years forced to disappear mysterious | ICT News

On Thursday, another Chinese e-commerce company, VIP Shop, confirmed that it was under investigation by the authorities for “unfair competition practices”. Alibaba rival Pinduoduo has also been at the center of controversy as its employee-exhausting work culture shows that the government is willing to criticize the industry broader.

More importantly, Beijing’s desire to extend its influence over private tech companies goes far beyond such investigations. Although sanctions have risen in recent weeks, the government has long been tacitly formulating the plan. Capri points out that some tech companies have been forced to cooperate with state-owned enterprises – like Ant Group’s Alipay partnering with the state’s UnionPay in 2018 to develop new technology.

“The coming weeks and months will see this trend increase. Access and control of data and digital platforms are key. So if that means splitting Alibaba or turning it into Companies like the state are absolutely probable scenarios.

While Alibaba’s business is primarily in China, any major change to its operations could have a global impact. The company has been trading on Wall Street since 2014 when it set the world’s largest IPO record. They are also backed by Softbank, the largest investor. A few other companies pouring money into here including Vanguard, T. Rowe Price and BlackRock.

Pressure from outside

The US is still increasing sanctions on Chinese companies as trade tensions between the two countries continue to escalate. Xiaomi is the latest victim to the damage as it is banned from accessing investments in the US.

The New York Stock Exchange also suspended trading with a group of Chinese companies this week to comply with a ban on Americans from investing in related businesses or supporting the Chinese military. President Donald Trump also recently signed a new law that forces Chinese companies to delist if they fail to meet US auditing standards.

The Trump administration is said to have considered banning Americans from investing in Alibaba and other tech companies, causing their shares to drop last week. Although some major newspapers such as Reuters or Bloomberg say that the plan is no longer viable, analysts warn that the company may not be out of danger.

“Washington’s focus on these issues will continue under President-elect Joe Biden.”

Alibaba’s cloud computing business is one example. They could face a global boycott just like what happened with Huawei’s 5G system.

“China certainly won’t want to destroy one of its biggest companies,” said Rana Mitter, professor of modern Chinese history and politics at Oxford University. Any change to Alibaba’s business would therefore be “medium-sized”, not “total disintegration,” he said.

The fact that Jack Ma has not appeared in the media for months now, considered by Brock Silvers, the chief investment officer of Kaiyuan Capital, is the clearest proof that his empire is in real trouble at home. That “undermines the market’s confidence in the company”.

“Ant Group’s IPO is now just a distant memory, and the company looks like it could be split and adjusted towards a significant drop in overall pricing,” he said. In an article this weekend, the Financial Times stated that Ant Group’s major global investors were “abandoned” after investing billions of dollars to catch the IPO.

Jack Ma s stormy retirement days Making Alibaba face the most severe survival crisis in history over 20 years forced to disappear mysterious | ICT News

And while Alibaba appears to be intact so far, that doesn’t mean the company has been free from legal threats. “Whether 2021 is any better for Alibaba may depend on the nature and sudden silence of Jack Ma,” said Silvers.

Recalling the year 2019 when he officially announced his retirement at the age of 55, Jack Ma said: “I want to die on the beach, not in my office.”

“When I left my position as CEO (in 2013), I told the executive team that I should have more time to play golf on the beach. But man! Last year, I spent 870 hours on a plane and five. It is 1,000 hours now, “he said in a 2017 interview.

However, unexpectedly, because of a blow, maybe the later retirement days of Jack Ma will not be “relaxed” as he wants. Alibaba’s future once again, depends on you!

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