Extra costs and technology delay if Europe bans Chinese 5G equipment
Jun-18-2019 By : fcccadmin
Europe would have to pay an extra €55 billion for 5G networks and suffer an 18-month technology delay if it bans telecom equipment purchases from top Chinese manufacturers, according to a report by the GSM Association, which represents 750 mobile operators worldwide. Ericsson, Nokia and Samsung, the non-Chinese contenders in the 5G market, do not have the capacity to handle all of the shift from 3G and 4G networks to 5G in Europe while honoring contracts already signed in North America and Asia. Huawei and ZTE account for about 40% of the EU market, and Huawei is “currently a pioneer in 5G technology”, according to the GSM analysis.
“A ban on Chinese vendors would severely lessen competition in the mobile equipment market, increasing prices and driving up 5G rollout costs,” the report said. It predicted that a ban would “result in slower rollout of 5G networks in Europe. U.S. President Donald Trump signed an executive order on May 15 to ban the technology and services of “foreign adversaries” deemed to pose national security risks. The U.S. Commerce Department consequently added Huawei and 68 affiliates to its Entity List, banning Huawei from buying parts and technology from U.S. firms without government approval. The U.S. later granted a 90-day reprieve of the ban.
Germany, France and the United Kingdom have so far rejected a total ban of Huawei. German Chancellor Angela Merkel has said companies that meet established safety criteria could take part in tenders for building Germany’s 5G network. The BDI, the federation of German industries, said that “Europe needs to maintain its own course” and the EU would decide independently which companies it would allow to build 5G network infrastructure.
Abraham Liu, Huawei’s Chief Representative to the EU institutions, recently said in Brussels that Huawei’s 5G solution is the best on the market and to a large extent a European product. “It is tailor-made for Europe’s needs,” he said. Huawei has been operating in Europe for almost 20 years and has 12,000 employees there, 70% hired locally. “Huawei is becoming the victim of bullying by the U.S. administration. This is not just an attack against Huawei. It is an attack on the liberal rules-based order. This is dangerous,” he said, as reported by the China Daily.
15 Chinese brands included in the 2019 BrandZ Top 100 Most Valuable Global Brands list
By : fcccadmin
On June 11, the 2019 BrandZ Top 100 Most Valuable Global Brands list was released in New York. Amazon topped the rankings, replacing Google, which was the previous champion. Fifteen Chinese brands were included on the list this year, with Alibaba as the frontrunner. China Life, Bank of China (BOC) and SF Express, three Chinese brands included on the 2018 list, did not make the 2019 list. This year’s newcomers from China were Haier, Meituan, Didi and Xiaomi. Of the 12 Chinese brands that remained on the list, Alibaba, Ping An and Huawei moved up, while Tencent and eight other brands moved down. BrandZ’s brand value system is a reminder that brand value is not necessarily directly proportional to a firm’s size as global brand value must be endorsed by a global customer base. The list shows that the combined value of the top 100 brands stands at USD4.7 trillion, representing a year-on-year increase of USD328 billion, or 7.5%.
Thirty-four of the brands that remained on the list lost brand value, with GE experiencing the steepest decline, down 32%. Fifty-seven achieved a higher brand value, among them the nine new entrants and Instagram, whose brand value soared 95%. The new champion Amazon saw its brand value surge 52%. Other high-achievers which enjoyed 50%+ increases in their brand value included Netflix (65%), Salesforce (58%), Adobe (57%) and Uber (51%).
The six brands with the highest increases in value owe their success to the transformation of their business models, Amazon’s success comes its service partners on the Amazon platform, while Haier’s success comes from the successful transformation of its empowered ecosystem brands within Haier’s IoT ecosystem. Netflix has shifted its business from DVD rentals to a video streaming platform. Salesforce has repurposed itself from a software vendor to a cloud-based industrial ecosystem. BrandZ Chairman David Roth said: “We see a new trend of moving away from the delivery of a single product and service toward a disruptive ecosystem. Brands that want to succeed in the future must understand the value this model could potentially unlock and embrace this model willingly. “BrandZ has introduced a new category on its 2019 list – the IoT ecosystem. Haier was the first brand to be placed in this category. Haier’s brand value was assessed against the criterion of “an ecosystem consisting of multiple interrelated companies,” the Shanghai Daily reports.
Car sales continue downward trend
By : fcccadmin
China’s car sales continued their long downward trend in May due to weak demand and macro-economic factors. Car manufacturers sold a total of 1.91 million vehicles in China last month, down 16.4% year-on-year, according to the China Association of Automobile Manufacturers (CAAM), marking the 11th straight month of decline after falls of 14.6% in April and 5.2% in March. From January to May, the country sold a total of 10.27 million vehicles, down 13% compared with the same period last year. The CAAM said that based on the situation in May, the downward trend was due to weak consumer demand and some automakers slowing production to reduce the burden on the retail market.
Xu Haidong, CAAM’s Assistant Secretary General, said one key reason for the drop was provinces implementing “China VI” vehicle emission standards earlier than the central government’s 2020 deadline, stoking uncertainty among manufacturers. The Association noted that with the increase in the number of models meeting the new emission standards and a series of policy measures which will reduce tax and other fees in the second half of this year, the passenger car market will get a boost.
Sales of passenger vehicles reached 1.56 million in May, down 17.4% compared with the same month last year. Sales of commercial vehicles totaled 351,000 last month, down 11.8% year-on-year. Despite a weak performance in the overall auto market, sales of NEVs are booming. From January to May, new-energy vehicle sales surged 41.5% year-on-year to 464,000 as production jumped 46% year-on-year to 480,000 vehicles. Earlier this year, the CAAM forecast flat 2019 sales at 28 million, while industry insiders tend to predict that overall sales in China’s auto market will decline this year. Auto sales fell in 2018 for the first time in more than two decades, dropping 2.8% to 28.1 million, hit by macro-economic factors, the Sino-U.S. trade war and weak consumer confidence, the Shanghai Daily reports.
Meanwhile, Shanghai’s Jiading district government has announced a plan for the development of the hydrogen fuel cell vehicle industry. A 2.15 sq.km. hydrogen park will be established in the Shanghai International Auto City, and by 2025, the annual output value of fuel cell vehicles is expected to reach CNY50 billion. China aims to have 1,000 hydrogen filling stations and 1 million hydrogen-powered vehicles by 2030.
Chinese carmaker Geely Auto Group agreed to partner with South Korean battery maker LG Chem in the fast-growing new energy vehicle segment. Shanghai Maple Guorun, a subsidiary of Geely, will form a 50-50 joint venture with LG Chem in China with a registered capital of USD188 million to manufacture and sell batteries for new energy vehicles. When completed by the end of 2021, the joint venture is expected to have an annual production capacity of 10 GWh, and the batteries would be installed on Geely’s vehicles from 2022. Geely is planning to launch more than 30 electrified vehicles, including hybrids and pure electric vehicles, in the next two years as part of its ambitious electrification plan called Blue Geely Initiative released in late 2015. According to the plan, Geely aims for 90% of its sales to come from electrified vehicles starting from 2020. The carmaker launched a pure electric vehicle brand called Geometry in April 2019 and the first model under the brand, Geometry A, has hit the market.
Shanghai continues promoting the “Shanghai brand”
By : fcccadmin
Sixteen enterprises were awarded the “Shanghai brand” certificate in a further push by the city to create a cluster of internationally competitive brands. The certificate is classified in four categories: Shanghai services, Shanghai manufacturing, Shanghai shopping and Shanghai culture. Among the enterprises which got the certificates were Shanghai Shentong Metro Group, Jiangnan Shipyard, Shanghai Baoye Group and Lei Yun Shang, a time-honored traditional Chinese medicine company known for gaofang, a Chinese herbal paste. The winners of the “Shanghai brand” plaque, apart from being leading brands in their fields, meet standards like self-innovation, excellent quality, refined management and social responsibility, the Shanghai Administration for Market Regulation said.
Lei Yun Shang West, one of several pharmacies under the renowned name of Lei Yun Shang, is the most popular with locals for its quality products, especially gaofang. Its innovative and scientific approach has helped it earn the “Shanghai brand” certificate. It is the only TCM brand to get the honor. It is very hard for a TCM industrial player to gain the “Shanghai brand” plaque because of the very high standards expected. In 2011, Lei Yun Shang West became the city’s first TCM industrial player to come up with standards for making gaofang.
Fifty-three enterprises were in the first batch to be certified “Shanghai brand” in June last year. They come from various industries, including Zhenhua Heavy Industries Co, Shanghai Construction Group and Shanghai No 1 National Musical Instruments Factory. Enterprises apply for the certification to the Shanghai Brand International Certification Alliance, which conducts an assessment. The alliance currently has 22 members, which are domestic and overseas certification agencies, the Shanghai Daily reports.
Alipay preparing to launch QR-code payments in Europe, as PBOC defends continued use of cash payments
By : fcccadmin
Alibaba’s payment affiliate Alipay has joined with six mobile-payment service providers in Europe to collaborate on QR-code payments. The six parties – Bluecode, ePassi, momo pocket, Pagaqui, Pivo and Vipps – will use a QR code format provided by Alipay, covering more than 5 million digital wallet users and around 190,000 merchants in Europe. Bluecode and ePassi will offer technical services. Merchants that already accept mobile payments via the six apps will be able to accept payments by customers from other countries covered by the collaboration. Alipay users in China will be able to pay in Europe without downloading a separate app for each country. Rune Garbog, CEO of Oslo-based Vipps, said: “We are extremely enthusiastic about new partners joining this collaboration, giving all our combined users broader possibilities for using their preferred mobile app when traveling abroad,” the Shanghai Daily reports.
The use of mobile payment services in China has skyrocketed in the past five years, with the total number of transactions reaching CNY277.39 trillion last year, a rise of more than 27-fold from five years ago. The country is already the world’s biggest market for mobile payments, with some 583 million users last year, a rise of 10.7% from 2017. But the People’s Bank of China (PBOC) has cracked down on merchants who refuse to accept cash, as1 billion people are regularly paying for items with their mobile phones. Sweden could be completely cashless by 2023, but about 1 million Swedes are not ready for digital payments, according to Christina Tallberg, President of the Swedish National Pensioners’ Organization. Some 600,000 elderly Swedes forced to use digital currency when using a public restroom or parking a car are some of the biggest opponents in the Scandinavian country of a cashless society. In the U.S., officials in San Francisco voted on May 8 to require brick-and-mortar retailers to accept cash, joining Philadelphia and New Jersey. Other U.S. cities, including New York, Chicago and Washington, are considering barring cashless stores to ensure that everyone can shop with cash, the China Daily reports.
According to a GSMA Mobile Economy Report last year, of the 7.7 billion people in the world, 5 billion used mobile services in 2017. It is estimated that the number of global mobile subscribers will reach 5.9 billion by 2025 — some 71% of the world’s population — which could lead to more people using their phones as payment devices.
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