The Chinese government has proposed establishing a joint venture with local technology giants that would oversee the lucrative data they collect from hundreds of millions of consumers, people familiar with the matter said.
The preliminary plan, which is being led by the People’s Bank of China, would mark a significant escalation in regulators’ attempts to tighten their grip over the country’s Internet sector.
It envisions the creation of a government-backed entity along with some of China’s biggest e-commerce and payments platforms, the people said, asking not to be identified as the discussions are private.
The online firms would be initial shareholders in the joint venture, although top executives would need to be approved by the regulator, the people said.
The central bank did not immediately respond to a request for comment.
The proposal is among a slate of options being considered to crystalize Beijing’s goal of gaining greater control over the data amassed by online behemoths from Alibaba Group Holding Ltd (阿里巴巴) and Tencent Holdings Ltd (騰訊) to up-and-comers like ByteDance Ltd (字節跳動) and Meituan Dianping (美團點評).
One of the key hurdles for such a joint venture would be existing rules around data privacy, which give individuals the right to decide how their information is used, one of the people said.
Putting consumer data under the oversight of a company or the government would require changes to the law, the person said.
It is still unclear what the overall scope of the new entity would be, what types of data it would manage and from what sources.
A part of the proposal envisions it eventually forming strategic alliances with government-backed institutions to facilitate data sharing, one of the people said, without providing further details.
Much like Facebook Inc or Google, the enormous amounts of information that China’s Internet giants hoover up in real time are key to their bottom lines, as well as their ability to innovate and expand.
However, Beijing has grown increasingly wary of the might of companies such as Alibaba and Tencent, and their potential to influence public opinion.
Chinese President Xi Jinping (習近平) this month said that his government would go after so-called “platform” companies that have amassed increasing power through the data and patronage of hundreds of millions of consumers.
The strongly-worded comments signaled that China plans to amplify a campaign to curb the influence of its most powerful private firms, which has so far centered mainly on Jack Ma’s (馬雲) Alibaba and its affiliate Ant Group Co (螞蟻集團).
Xi’s comments were the first time he specifically addressed platform economies, although he has previously stressed the importance of preventing monopolies.
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