Some forces are so powerful that they manifest themselves globally. Consider digital antitrust actions.
Google was sued so many times in December by the federal and state governments that my column two weeks ago required last-minute revisions to update it in the days since it was filed.
Now comes news that China is going through similar societal conflict about how large a role giant digital corporations should be allowed to play in society.
China’s richest man is Jack Ma, founder of Alibaba and the Ant Group.
Alibaba is the world’s largest retailer and e-commerce company, roughly a combination of Amazon and eBay in its services.
The Ant Group is a sister company and financial-services giant, with more than 700 million monthly users of its payment processing, loans, investing and insurance services.
On Dec. 26, the People’s Bank of China, the country’s central bank, summoned Ant Group for regulatory talks, with a sweeping plan to correct so-called regulatory violations, according to TechCrunch.
Two months earlier, China’s financial authorities had stopped a public stock offering of Ant.
TechCrunch said the government noted Ant “lacked a sound governance structure, defied regulatory requirements, illegally engaged in arbitrage, excluded competitors using its market advantage and hurt consumer rights, said the central bank.”
The New York Times reported last week that the Chinese government has become harder on big internet companies, which like Google and Facebook in the U.S. wield vast influence over some sectors of the economy. The government also has opened an antimonopoly investigation into Alibaba.
Ant’s consumer-lending unit and other fast-growing parts of the financial technology group will be carved out into a new financial holding company to be regulated by the People’s Bank of China, under the government’s plan.
The movement toward regulation is not likely to stop.
The future will likely involve governments globally limiting the scope and services of digital super-platforms so as to enable commerce to thrive beyond the handful of giants.
Isaac Cheifetz is a Twin Cities executive recruiter. He can be reached through catalytic1.com.
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