Copycats? China's tech firms are now trailblazers: Report

China's "copycat" tech industry is being copied by tech companies in the United States, Japan and Indonesia, a recent report has found.

Increasingly, Facebook's Messenger, Japanese messaging app Line and Indonesia's ride-hailing app Gojek are adding more services to their platform, moving towards the model of Chinese messaging platform WeChat and mobile payments app Alipay, said the China Internet Report 2019 released last week.

The annual report also noted that social credit - a system in which people and businesses are given scores to reflect their trustworthiness - is becoming a reality in the country of nearly 1.4 billion people, with local governments rolling out their own schemes ahead of a 2020 deadline.

Other top trends it highlighted include China's race to implement 5G as well as its mass deployment of artificial intelligence (AI) in such areas as access control, surveillance and smart city solutions.

The report, created by venture capitalist Edith Yeung, is co-authored by Hong Kong media firm South China Morning Post (SCMP) and its sister site Abacus.

"Technology has been a central piece of the US-China trade war, so understanding what is driving tech in China is essential knowledge in today's world," said SCMP technology editor Chua Kong Ho.

The report found China and the US operate in two separate technology ecosystems, each with its own key players that range from search and social media to ride sharing and home sharing.

In China, tech giants such as Baidu, Alibaba and Tencent have built their own ecosystems, while newer entrants such as news and content platform Toutiao, e-commerce platform Meituan-Dianping and ride-hailing app Didi are strengthening their core businesses.

Toutiao is a key product of the world's most valuable unicorn Bytedance, while Meituan-Dianping offers services ranging from food delivery to restaurant reviews. Didi is China's most powerful ride-hailing app that forced Uber out.

The report noted that the Internet penetration rate in China is 60 per cent, which works out to almost three times the number of Internet users in the US.

The gap is wider when it comes to mobile payments, it added.

At 583 million users, "there are more people who make payments with their phones in China than there are people in the US", it said.

But what's striking is how tech firms like Facebook, Line and Gojek are taking a leaf out of their Chinese counterparts' playbook in transforming their apps into super apps. These super apps are a one-stop shop for services such as messaging, shopping, ride-hailing and mobile payments.

Concepts such as group buying and live streaming pioneered by China's online shopping giants like Taobao and start-ups like Mogu are also starting to spread to American platforms such as Amazon, Instagram and Google, said the report.

One major trend this year continues to be the intensive effort to adopt AI technologies across various sectors in the country.

For example, commuters at Futian subway station in southern Shenzhen can scan their faces on a tablet-size screen mounted at the entrance gate and have the fares automatically deducted from their linked accounts.

In terms of surveillance, computer vision, facial recognition and augmented reality technologies are used to help the authorities catch criminals, enforce traffic laws, identify citizens and control crowds, the report added.

One new development that looks set to be a buzzword this year is China's social-credit system.

It ranks citizens according to their trustworthiness, relying "on a series of rewards and punishments meant to encourage people and businesses to abide by rules".

"In reality, there is no central scoring system but a patchwork of different schemes and apps with differing criteria across provinces, cities and villages," it said.

Still, this will be the year where different local governments scramble to show they are meeting their targets, it added.

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A version of this article appeared in the print edition of The Straits Times on July 15, 2019, with the headline Copycats? China's tech firms are now trailblazers: Report. Subscribe