Matney: Alibaba’s rise blurs Internet’s international borders


Lucas Matney, Columnist

Alibaba, a massive Chinese Internet conglomerate, debuted on the New York Stock Exchange this week, raising more than $25 billion in its debut — the largest initial public offering ever. The company, which has been referred to as “China’s Amazon,” had $240 billion in sales in 2013, more than both Amazon and eBay combined. Founder Jack Ma has big plans for expanding Alibaba to the American market and elsewhere as he strives to overtake Walmart as the world’s largest retailer.

Alibaba’s rise signifies an important change in the tense online relationship between the United States and China. It raises questions as to why the Internet, a technology seemingly synonymous with connectivity, exists in such separate entities across international borders. In the case of China and the United States, the answers point to a shaky association often marred by China’s state censorship and curbed in the name of economic protectionism and national security concerns on both sides.

This globalized exchange has its winners and losers and unfortunately the least likely to benefit is always China’s 642 million Internet users. Over the past decade, American firms have made the move to China and have regrettably both complied with and assisted the Chinese government in building its censorship engine. More than 2,700 websites are currently blocked by China’s “Great Firewall.” This list of censored sites is composed of American tech titans like Google, Twitter and Facebook; highly critical news sources like The New York Times website and Japanese iterations of popular sites, including what would be an Alibaba competitor, Amazon Japan. China’s motives are growing increasingly more strategic and seem to often be much murkier than merely suppressing free expression.

Protecting national security seems to have a broad interpretation to the Chinese government, one that involves maintaining a bustling economy at any costs. In the past decade, this national strategy has led to innumerable cyber attacks against U.S. companies, likely carried out by the Chinese government with the goal of stealing intellectual property to feed its own corporations. Blocking U.S. sites such as Facebook and Twitter has also allowed large Chinese tech companies such as Weibo and Alibaba to grow up and fill the voids left vacant by them.

The Obama administration, like previous administrations, has relied mostly on arguments related to national security for keeping Chinese tech companies out of the mainstream. Largely through financial incentives, the American government has spent considerable effort dissuading corporate America from using products from Chinese telecommunication firms. A move that was exposed in Glen Greenwald’s book “No Place to Hide,” as a unified effort against products with “backdoor access” that would allow the Chinese government to track American users’ online movements. A concerning development, though there is significant evidence that America has been engaging in such tactics as well. It’s too soon to tell how the U.S. government would react to a popular Chinese-owned Internet service like Alibaba taking hold in the United States, one that would undoubtedly capture a great deal of information on American consumers to be stored in servers possibly on foreign soil.

If Alibaba is successful in making the move to Western consumer markets, it may tempt more of the dozen or so Chinese tech companies looking to go public this year on Wall Street into expanding their own operations stateside.

Despite the issues that will undoubtedly arise, if American and Chinese governments can manage to decrease tensions and recognize the mutual benefits that would arise from enhancing the online connections of the two countries, consumers on both ends will likely benefit greatly. That will only happen, however, if China can tear down its “Great Firewall” and allow its citizens to reap the benefits of an open Internet rather than just its corporations.

Lucas Matney is a Medill junior. He can be reached at [email protected]. If you would like to respond publicly to this column, send a Letter to the Editor to [email protected].

Correction: Due to an editing error, several facts in this column were misstated or altered. The column has been updated to rectify these changes. The Daily regrets the error.