Philippa Kaur

MESSAGING IS AN intimate medium for sharing private views and sentiments. It is a cocktail-party whisper in digital form, as one user of WhatsApp, a service owned by Facebook, put it. Now some of the world’s biggest brands are venturing into this personal realm. Aware of the limitations of conventional communication channels like call centres and email, a few years ago firms started using WhatsApp and its sister app, Facebook Messenger, as well as Apple’s iMessage and independent apps such as Line.The pandemic gave all such apps a fillip. Messaging on Instagram, Facebook’s photo-sharing app, and on Messenger rose by 40%. Four-fifths of mobile-device time is now spent on chat apps. Companies can usually be relied upon to go where customers are, so messaging has become vital for business, not just experimental, says Javier Mata, founder of Yalo, a startup whose technology connects firms to messaging platforms. Firms once used them chiefly for customer service. Now they want to get people to buy stuff via chat, as hundreds of millions of Chinese do on WeChat, owned by Tencent, China’s mightiest tech giant.Because many popular messaging platforms are encrypted, data on transactions are hard to come by. But growth is undoubtedly happening. Over 1bn people now interact with businesses via chat, not counting China. Each day 175m people send a message to WhatsApp business accounts (WhatsApp channels designed for companies). Yalo’s customers include consumer-goods giants such as Coca-Cola, Nestlé, PepsiCo and Unilever, as well as Walmart, the world’s biggest retailer. Apple Business Chat, which started in 2017, is used by Home Depot DIY stores, Hilton hotels and Burberry, a fashion brand. Facebook’s roster includes Sephora, a cosmetics retailer, and IKEA, a furniture giant. LVMH, a French luxury-goods conglomerate, is testing out messaging, according to Jeroen van Glabbeek, chief executive of CM.com, a Dutch conversational-commerce platform.“C-commerce” is already entrenched in Asia and Latin America, where spotty access to broadband and high-quality devices puts e-commerce and company-specific apps out of reach for many. Now Western consumers are beginning to embrace the ease, speed, personalisation and convenience of messaging. For firms, the return on investment seems higher for messaging than for call-centre exchanges or email chains, says Emile Litvak, head of business messaging at Facebook.Boosters of business messaging claim that c-commerce will displace e-commerce within a decade or two. But messaging is best understood as a refinement of e-commerce, and a sibling of “social commerce” (shopping on social media). Most messaging conversations between large firms and consumers start from corporate e-commerce websites equipped with a “click to message” button. Plenty begin on social networks.In some ways c-commerce is a throwback to the past. Apart from mail order and its modern guise, online shopping, trade has relied on conversation for millennia. Yet business messaging does have new elements. It is more personalised than SMS marketing, which has itself had success in recent years in America and Europe. Automatic messaging is moving beyond rudimentary chatbots, which have been around since the mid-2010s. Artificial intelligence (AI) is getting better at unstructured exchanges that shoppers used to have with expert retail assistants.For now, says Marc Lore, who led Walmart’s digital efforts, a lot of business messaging has humans in the loop. In future, he reckons, AI will be able to answer customer requests as fuzzy as “get me a birthday toy for a five-year-old around science education for roughly $40”, suggesting choices and completing the transaction in seconds. And when AI gets better at natural dialogue, as it will after learning from human interactions, consumer-to-business messaging may sound if not exactly like J.A.R.V.I.S, Tony Stark’s digital butler in the Marvel comics, then close enough.Until that time, firms must tread delicately. Full of family and friends, chat apps are emotional spaces, says Robert Bennett, CEO of Rehab, an agency that helps brands reach consumers digitally. Try to sell someone yoga leggings after an exchange with their mother, he says, and your firm might find itself deleted faster than an ex. But get it right—think gentle reminder of evening meditation from a purveyor of herbal teas—and the rewards look tasty. ■This article appeared in the Business section of the print edition under the headline “Chat-up lines” More

CHENG WEI, the billionaire founder and chief executive of Didi Global, had scarcely a moment to revel in his firm’s $4.4bn New York listing. Within 48 hours of the initial public offering (IPO), which valued the Chinese ride-hailing giant at around $70bn, regulators in Beijing spoiled the party. On July 2nd the Cyberspace Administration of China (CAC) said it had launched an investigation into the company. The announcement shaved 5% off its share price.Two days later the regulator ordered Didi’s mobile app to be pulled from app stores in China, halting new customers from joining the service (existing users can still hail taxis). The CAC alleges that Didi was illegally collecting and using personal data. Didi said that it would “strive to rectify any problems” but warned of “an adverse impact on its revenue in China”. Predictably, the ban also adversely affected the company’s market value. When American markets reopened on July 6th, Didi promptly shed more than a fifth of it. It is now worth $22bn less than a week go.The CAC’s move is an escalation in China’s crackdown on big technology firms. On July 5th it told three other apps—Yunmanman and Huochebang, which operate lorry-hailing and cargo apps, and Boss Zhipin, an internet recruitment service—to stop enlisting new users. The trucking services, which merged under the name Full Truck Alliance, and Kanzhun, which owns Boss Zhipin, had together raised $2.5bn in American flotations last month.Wolf warrior of Wall StreetAll told, Chinese firms have raised $13bn in America so far this year, and $76bn over the past decade. Around 400 Chinese companies have American listings, roughly twice as many as in 2016. In that period their combined stockmarket value has shot up from less than $400bn to $1.7trn. Those investments are now in peril. On July 6th Chinese authorities said they would tighten rules for firms with foreign listings, or those seeking them. It is the starkest effort yet to disconnect China Inc from American capital markets.Besides regulating what corporate data can and cannot be shared with foreigners, the new rules would target “illegal securities activities” and create extraterritorial laws to govern Chinese firms with foreign listings. According to Bloomberg, a news service, Chinese regulators also want to restrict the use of offshore legal structures that help Chinese companies skirt local limits on foreign ownership.Nearly all Chinese tech giants listed in America, including Alibaba, a $570bn e-merchant, as well as Didi, use such “variable-interest entities” (VIEs). A VIE is domiciled in a tax haven like the Cayman Islands, and accepts foreigners as investors. It then sets up a subsidiary in China, which receives a share of the profits of the Chinese firm using the structure. China’s government has long implicitly supported this tenuous arrangement, upon which hundreds of billions of dollars of American investments rely. Now it wants Chinese firms to seek explicit approval for the structure. The assumption is that Beijing would be hesitant to grant it. Existing VIEs may also come under scrutiny.A formal blessing from Beijing may help avoid the sort of kerfuffle Didi has found itself in. In April the firm was among 30 companies called in by the CAC and the State Administration of Taxation. It was given a month to conduct a sprawling self-inspection. It added a warning that it “cannot assure [investors] that the regulatory authorities will be satisfied with our self-inspection results” to the risks listed in its prospectus, alongside antitrust, pricing, privacy protection, food safety, product quality and taxes. It went ahead with its New York IPO regardless. Punishing the company right after its listing looks like deliberate retaliation for pressing on before the regulators were done with their probing, says Angela Zhang of the University of Hong Kong. Didi’s new public investors were badly burnt as a result, just as the private investors in Ant Group were in November, when the financial-technology firm’s $37bn IPO was suspended two days before its shares were due to begin trading in Hong Kong and Shanghai.All this is chilling both Chinese firms’ appetite for foreign listings and foreign investors’ hunger for Chinese stocks, and not just in America. The day after the Didi ban the four biggest tech groups with listings in Hong Kong—Tencent, Alibaba (which has a dual listing), Meituan and Kuaishou—lost a collective $60bn in market capitalisation. The effects on some of the world’s most innovative and value-generating companies of the past decade may be crippling, especially in conjunction with greater scrutiny of Chinese companies by America’s government.American regulators have long sought to force Chinese companies listed on America’s bourses to submit auditing documents to an oversight body called the Public Company Accounting Oversight Board. In December Congress passed a law that would require such disclosures with bipartisan support. At the same time, Chinese regulators have refused to permit Chinese companies to make such disclosures, declaring auditing documents to be state secrets. If the standoff does not ease, Chinese groups could eventually be forced to delist from America.So far there is no sign of easing. Before Didi’s IPO, Marco Rubio, a Republican senator from Florida, called on America’s Securities and Exchange Commission to block the transaction. He fumed that the flotation “funnels desperately needed US dollars into Beijing and puts the investments of American retirees at risk”. This week he called the decision to let the IPO go ahead “reckless and irresponsible”. President Joe Biden is less strident but his Democratic Party also wants to curb China’s economic and technological might.As the symbiotic relationship between Chinese firms and American investors unravels, both will suffer. The former are losing access to the world’s deepest capital markets, the latter to some of its hottest stocks. The market value of Chinese firms in America has fallen by 6% since the Ant debacle last autumn signalled a shift of mood in Beijing, even as the S&P 500 index of big firms has gained 30% as a whole. Didi won’t be the last casualty. ■This article appeared in the Business section of the print edition under the headline “In the grip of anxiety” More

FOR THE 10,000 years or so it has been around, beer has been relied upon both to refresh and intoxicate. Today’s brewers think it could thrive by focusing exclusively on the former. Alcohol-free beer is the booze industry’s latest great hope as sales of the full-strength stuff have stagnated. If Heineken and other brewing giants have their way, tipplers will be knocking back pints from breakfast on.Beers with no (or little) alcohol have been sold for decades. But even their peddlers admitted they tasted flat. They were aimed at those who craved a proper beer but couldn’t indulge: the pregnant, religious or designated drivers. Multinational brewers saw them as “distressed purchases” and sold them under separate brands far removed from flagship marques.No longer. Even before the pandemic shut the world’s bars, beer-drinking was on the slide, in part owing to health-conscious millennials bingeing less often. Booze barons concerned about losing sales to soft drinks invested in ways of making alcohol-free beer taste better. This has started to pay off. Though nobody sober would confuse an alcohol-free brew with the real thing, it is now a credible draught. The product is good enough for mega-brands, from Japan’s Asahi to America’s Budweiser (part of AB InBev, the world’s biggest brewer), to offer a “0.0” variant.Part of the brewers’ interest stems from boozeless beer’s frothy margins. Making the stuff is actually more expensive than making a straight-up Stella. The process usually involves taking a finished alcoholic beer and stripping away the booze (brands guard their methods closely). But the expense is more than compensated for by the savings on alcohol excise duties that are no longer owed. It helps that consumers are willing to pay roughly the same price whether a beer contains alcohol or not.Beer that is entirely alcohol-free continues to be niche. “At the moment, alcohol-free beer is still something you drink when you can’t drink,” says Trevor Stirling of Bernstein, a broker. Only 2.4% of beer sold globally this year will be non-alcoholic, according to Euromonitor, a research firm. Still, that is up from 1.5% a decade ago, in part because traditional beer has slipped. Much of the growth in 0.0 sales has come from places that consume lots of beer already, notably Europe. The aim for brewers is therefore to reposition their virtuous offerings not as beer at all, but as a premium soft drink for grown-ups. That would give them a toe-hold in a market that is, by volume, nearly four times as large as beer. Indeed, many brewers believe that their booze-free products can refresh consumers whom its regular beers cannot reach. Bram Westenbrink of Heineken says only a fifth of its 0.0 drinkers would otherwise have plumped for a normal beer. The Dutch giant has pitched its alcohol-free brand as a suitable tipple for the office, gym and car. (It is also targeting more traditional beer-drinkers by sponsoring the European football championship.)The beer giants also think their investments in deboozing give them an edge over upstart rivals. Craft brewers, which have thrived in recent years, work in small batches for which stripping away alcohol is uneconomical. Their hoppy flavours rely on plentiful alcohol content to satisfy drinkers, unlike the blander lagers that dominate supermarket shelves. ab InBev is aiming for at least 20% of its sales to come from no- and low-alcohol beers (typically below 3.5% alcohol by volume) by 2025, triple the current share. Heineken already has 130 0.0 products in its range. Governments and socially minded investors like to see beermakers offer alternatives to alcohol. Far from damaging a brand, having a 0.0 product is now a signal of a mature marque. Brewers have long tried to shift perceptions of beer as a laddish 1980s drink, fit only for football fans looking to get bladdered. Craft beers were one way to do that, but often turbocharged hangovers due to high alcohol content. Now the industry is going the other way. How refreshing. More

THE PANDEMIC, with its lockdowns and travel bans, clobbered the world’s airlines. Revenues per passenger-kilometre, the industry’s common measure of performance, plummeted by 66% in 2020, compared with 2019. The International Air Transport Association (IATA), an industry body, expects them to remain 57% below pre-pandemic levels this year. Although the world’s listed airlines have collectively just about recovered from the $200bn covid-induced stockmarket rout (see chart 1), forecasters reckon that air travel will return to levels from 2019 only by 2024. The companies’ total annual losses may hit $48bn in 2021, on top of $126bn in 2020. Many have been torching cash as fast as their aeroplanes burn jet fuel. Plenty survived only thanks to government bail-outs.The industry-wide picture conceals disparities, however. Some airlines are struggling despite having cut costs, slashed fleets and shored up balance-sheets with commercial loans. Others are brimming with confidence. Big American and Chinese ones with large, increasingly virus-free domestic markets will return to profitability first. Frugal low-cost carriers that went into the pandemic in the black are close behind. By contrast, airlines that depend on lucrative long-haul routes may struggle if, as seems almost inevitable, business travellers substitute Zoom for at least some flights. Regional companies in places still ravaged by covid-19, such as India or Latin America, look precarious. And the airspace between those losers and the industry’s winners is widening.Diverging fortunes are nothing new in the airline business. Most carriers make for a lousy investment (see chart 2). IATA reckons only around 30 of the 70 or so airlines for which data are available earned more than their cost of capital between 2008 and 2018. To keep flying, airlines need “strong balance-sheets or a parent with deep pockets,” says Rob Morris of Cirium, an aviation-data firm.Despite a degree of deregulation in the past 50 years, at the end of 2019 governments still controlled or had big minority stakes in 29 of the world’s 100-odd listed airlines, according to the OECD, a club of industrialised countries. States prop up loss-making national carriers, including privatised ones, which they view as vital infrastructure and a source of patriotic pride. In announcing Japan’s latest bail-out, the authorities talked of 240,000 jobs at stake and emphasised the role airlines play in connecting far-flung parts of the archipelagic country.Paternalistic governments have dug deep into their trousers during the pandemic. Between its onset and March this year public handouts to aviation exceeded $225bn globally, IATA calculates. This largesse helps explain why fewer carriers entered bankruptcy worldwide in the calamitous 2020 (43 of them) than in 2018 (56) or 2019 (46), according to Cirium.Even if the bail-outs tide some airlines over, however, they are no cure-all. On the contrary, they may prove poisonous. As Mr Morris of Cirium politely puts it, state support leads to “inappropriate cost bases”. One careworn observer remarks that Air France-KLM, a Franco-Dutch entity, has been “paid by the government not to restructure”. France wants to save as many jobs as possible and the Netherlands to ensure that Schiphol in Amsterdam remains a big connecting airport. Neither objective has much to do with returns.Moreover, bail-outs do not guarantee long-term success even in combination with a healthy pre-pandemic balance-sheet. Dubai’s Emirates enjoyed years of profits, as well as generous backing from the sheikhdom that owns it. So did Singapore Airlines (which is listed but controlled by the city-state’s government) and Cathay Pacific (Hong Kong’s publicly traded flag-carrier). Like many of their less lucrative counterparts with large international networks, including Air France-KLM, British Airways or Germany’s Lufthansa, they all “rely on the whole world reopening”, observes John Grant of OAG, another aviation-data firm. That will not happen until much more of the globe is vaccinated (see chart 3). And as much as executives dislike endless video calls, most despise constant flying even more.Amid the uncertainty, two categories of carrier can expect to prosper. The first is the full-service network airline which, like beaten-up rivals, offers long- and short-haul routes but which also, crucially, caters to a huge domestic market. The second group comprises nimble and cash-generative low-cost carriers that fly on a multitude of regional routes.The rebound in domestic flying favours American and Chinese airlines. Last year China, where covid-19 emerged but was suppressed more successfully than in the West, overtook America as the world’s biggest domestic market by capacity. Flights within China are back to levels in 2019, reckons Citigroup, a bank.Internal flights make up 60% of American air travel, compared with around 10% in Europe, the Middle East and Africa, estimates Oliver Wyman, a consultancy. America still lags a little behind China but air travel in the run-up to the Fourth of July weekend surpassed pre-pandemic levels. In Europe, by contrast, fragmented as the continent is by national borders, the number of short-haul flights is still down by 55% from pre-pandemic levels.Westerly tailwindsScott Kirby, boss of United Airlines Holdings, has warned that the American carrier needs about 65% of pre-pandemic demand for business and international long-haul trips merely to break even. Still, that looks achievable for United and its domestic rivals such as American Airlines, Delta Air Lines and Southwest (which pioneered no-frills flying in the 1960s but has turned into something like a domestic network airline, minus the international long-haul).American, for example, earns around 70% of revenues from domestic passengers, whereas full-service carriers elsewhere might rely on the big seats at the front of intercontinental flights for half their revenues (and up to 75% of profits). It helps that years of consolidation waved through by American regulators has created an oligopoly where the four big airlines ferry 80% of passengers.The Chinese market is similarly carved up between a few big carriers—Air China, China Southern and China Eastern. As a result, their revenue per passenger-kilometre is twice what it is in nearby South-East Asia, where competition is fiercer. With Chinese domestic travel more or less back to normal, and their costly geopolitical obligations to expand loss-making international routes put on ice because of covid-19, the trio are in better shape than ever before.The domestic rebound and growing confidence has helped American and Chinese airlines raise cash and avoid protracted state support. Of the big Chinese ones only China Eastern required a substantial bail-out. The American firms got a huge bail-out but are exiting it quickly. In March American Airlines tapped the market for $10bn in debt, most of which went on repaying government loans. A month later United raised $9bn with a similar goal.Importantly, the American companies have avoided the need to sell equity stakes to Uncle Sam. Combined with strong domestic cashflows, an early exit from government programmes gives the American and Chinese carriers a competitive advantage, says Andrew Charlton of Aviation Advocacy, a consultancy. In Europe, meanwhile, France has increased its stake in Air France-KLM to nearly 30%, Germany has taken a 20% stake in Lufthansa and the ever-hopeless Alitalia is now fully state-owned. Even as the three European firms continue to retrench, while dealing with growing state involvement, United Airlines has just placed an order for 270 new jets, its biggest ever. Delta and Southwest have also been buying aircraft.The return of short-haul international travel will revive the fortunes of the second sort of winner: low-cost carriers in highly vaccinated places, where borders are reopening and quarantine rules are being relaxed. European firms in particular stand to benefit from pent-up demand for holidays and visits to families and friends. More than eight in ten passengers flying with Ryanair, an Irish no-frills airline, and Wizz Air, a Hungarian one, are leisure-seekers compared with no more than seven for Lufthansa and Air France-KLM.The lack of a European oligopoly, and deep pandemic-induced cuts to the short-haul networks of legacy carriers, have left room for thrifty challengers to expand. Bernstein, a broker, expects Ryanair and Wizz Air, which have little debt and lots of cash to spend on new planes, to outfly European rivals in the next few years. So do investors. Both Ryanair and Wizz Air are worth more than before the pandemic.Some of the likely winners may stumble. Delta and United have some way to go before they regain their pre-pandemic market capitalisations. A few other victors may emerge. One improbable candidate, according to Bernstein, is the unloved British Airways. Its parent company, IAG, moved swiftly to slash costs, retire older and thirstier aircraft, delay deliveries of new planes and return leased aircraft with lots of unwanted premium seats. It is possible that network companies with passable finances and a good record, like Singapore Airlines, could eventually fly high again once international travel resumes. On July 5th a consortium of investors bet that long-haul flying would revive in time, by offering to pay $17bn for Sydney Airport, Australia’s gateway to the world, not too far below its stockmarket value in late 2019.Challenger carriers could spring a surprise in America, where the three thriftiest ones—Allegiant, Frontier and Spirit—have doubled their market share to 10% in the past five years and together lost less than $1bn in 2020, compared with $45bn for American carriers all told, according to Keith McMullan of Aviation Strategy, a consultancy. JetBlue, another American low-cost airline, plans to debut transatlantic flights on longer-range narrow-body jets that are far cheaper to operate than wide-bodies that typically ply such routes.Despite the fog of uncertainty, some upstarts are rolling out of the hangar. Breeze, which flies between smaller American cities overlooked by other carriers, and Avelo, which brings tourists to California, are taking advantage of cheap aircraft, plentiful pilots and available slots at once crowded airports. Catching up with high-flying American and Chinese oligopolists, or with the cheap and cheerful European firms, is not impossible. But it will take skilful piloting. More

CHENG WEI, the billionaire founder and chief executive of Didi Global, had scarcely a moment to revel in his firm’s $4.4bn New York listing. Within 48 hours of the initial public offering (IPO), which valued the Chinese ride-hailing giant at around $70bn, cyber-regulators in Beijing spoiled the party. On July 2nd the Cyberspace Administration of China (CAC) said that it had launched an investigation into the company, promptly shaving 5% off its share price.Two days later the regulator ordered Didi’s mobile app to be pulled from app stores in China, halting any new customers from joining the service (existing users can still hail taxis). The CAC alleges that Didi was illegally collecting and using personal data. Didi said that it would “strive to rectify any problems” but warned of “an adverse impact on its revenue in China”. The ban may have a similar effect on the company’s share price when American markets reopen on July 6th after the Independence Day weekend.The CAC’s move is the latest escalation in China’s crackdown against big technology firms. Various regulators have announced a flurry of investigations into e-commerce, gaming and online finance companies. Some have resulted in fines. In June the CAC said that 129 companies were being investigated for illegal data collection. On July 5th it told three other companies—Yunmanman and Huochebang, which operate lorry-hailing and cargo apps, and Boss Zhipin, an internet recruitment service—to stop enlisting new users. The trucking services, which merged under the name Full Truck Alliance, and Kanzhun, which owns Boss Zhipin, raised a combined $2.5bn in American flotations just last month.The consequences of these latest actions may be more far-reaching even than the regulators’ shock halting in November of the $37bn IPO of Ant Group, a financial-technology titan, just two days before its shares were due to begin trading in Hong Kong and Shanghai. Back then the suspension in effect punished those with existing stakes in Ant. The firm’s private backers, including Western groups such as Silver Lake and Warburg Pincus, were unable to cash out. Observers noted that things would have been worse had the regulators clamped down on Ant after its IPO.This is what the CAC decided to do this time. It left new public investors in Didi and the other three recently listed tech darlings, most of whom happen to be Western, badly burnt. The actions will chill enthusiasm for Chinese technology stocks, and not just in America. The day after the Didi ban the four biggest tech groups with listings in Hong Kong and mainland China—Tencent, Alibaba, Meituan and Kuaishou—lost a collective $60bn in market capitalisation. The longer-term effects on some of the world’s most innovative and value-generating companies of the past decade look ever more uncertain. They are unlikely to be positive.The nine-year-old Didi ranks among China’s top internet groups. Backed by SoftBank, a Japanese tech-investment giant, as well as Tencent, it has fended off rivals including Uber, the American ride-hailing pioneer, whose Chinese business it swallowed up in 2016. Although many analysts wonder whether Uber and other global ride-hailers can ever make a lot of money, few had reasons to doubt Didi’s prospects. These looked bright thanks to China’s numerous, densely populated conurbations. Although the company has global ambitions—it processes an average of 41m transitions each day worldwide, has nearly 500m annual active users, and runs a sizeable operation in Brazil—the bulk of its business remains at home.The CAC’s investigation is focused on the data Didi is collecting from its 377m China customers. The regulator has given no details about Didi’s supposed data misdeeds, other than to say they broke the law. The company collects a wide range of data on its users and drivers, such as audio and video recordings from each ride. In its prospectus it said that it uses artificial intelligence and facial recognition to monitor these audio and video recordings to check if the driver is fatigued. It noted that it shares personal data with third parties, where allowed.Data have emerged as a bone of contention between governments and big tech around the world. In China some government agencies are pushing for greater access to the troves of data that companies are collecting. For online payments groups such as Ant, personal financial data are a valuable component in determining creditworthiness. It is also something the government insists should be shared with state banking institutions for the broader good of society. The government’s plans to take control of personal data are expected to touch all of China’s internet giants.In April Didi was among 30 companies called in by the CAC and the State Administration of Taxation. It was given a month to conduct a sprawling self-inspection. It added a warning that it “cannot assure [investors] that the regulatory authorities will be satisfied with our self-inspection results” to the risks listed in its prospectus, alongside antitrust, pricing, privacy protection, food safety, product quality and taxes. It went ahead with its New York IPO regardless. Punishing the company right after its listing looks like deliberate retaliation for pressing on before the regulators were done with their probing, says Angela Zhang, a regulatory expert at Hong Kong University.Perhaps in an effort to avoid more personal punishment Chinese tech founders are keeping an ever-lower profile. Jack Ma of Alibaba has virtually disappeared from public life in China since the IPO of Ant, which he also co-founded, was canned (Mr Ma’s wife is believed to have secured a Singaporean passport some years ago). Colin Huang of Pinduoduo, another e-commerce group, stepped down from his chairmanship just as its user numbers overtook Alibaba’s. Wang Xing of Meituan fell silent after posting a 1,000-year-old poem online that could be read as critical of the government. Didi’s Mr Cheng has not made a peep since his ride-hailing app was expelled from app stores. Didi, for its part, said it “sincerely thank[s]” regulators for their actions. Its investors are probably in a less grateful mood. More

SOME DECADES ago Bartleby was covering the results of a company that was then in the FTSE 100 index. He was ushered into the offices of the firm’s public-relations outfit, whereupon the smooth-talking PR man (still a titan of the industry today) launched into a ten-minute monologue about the company’s strategy. At that point a subordinate popped his head around the door and the PR man was called away. “Thank goodness he’s gone,” said the chief executive. “Now I can tell you what is really happening.”Listen to this storyYour browser does not support the element.Enjoy more audio and podcasts on More

LAST SPRING at the Palais des Festivals in Cannes couture-clad film stars gave way to camp beds and showers. When France went into lockdown and the city’s film fete was postponed, then cancelled, the glitzy events space became a homeless shelter. This year’s bash, which begins on July 6th, offers a dose of Hollywood escapism. Screenings will be indoors, at full capacity. Stars will strut the red carpet (with designer face-masks and whiff of disinfectant the only giveaways). Yet backstage, covid-19 has changed the film business for good.Listen to this storyYour browser does not support the element.Enjoy more audio and podcasts on More

AT LAST, IT’S happening. Or so big tech’s critics thought. President Joe Biden has named one of their own, Lina Khan, to head the Federal Trade Commission (FTC). A Congressional committee has approved six bills to rein in Alphabet, Amazon, Apple and Facebook. Then, on June 28th, a federal judge provided a heavy dose of realism by summarily dismissing two antitrust cases against Facebook.The unexpected ruling, which sent Facebook’s market value past $1trn, was a reminder that, in America, the swelling “techlash” may yield meagre results. Judge James Boasberg—appointed by Mr Biden’s former boss, Barack Obama—threw out one of the cases, brought by 46 states, on a technicality. The complaint, which accused Facebook of acquiring nascent rivals, such as Instagram in 2012 and WhatsApp in 2014, to cement its social-networking dominance, was deemed too tardy. More profoundly, the judge found the second case, lodged by the FTC, “legally insufficient”. “It is almost as if the agency expects the Court to simply nod to the conventional wisdom that Facebook is a monopolist [in social-networking],” he wrote.That indeed seems to be what the FTC expected. It asserted that Facebook has a “dominant share of the market (in excess of 60%)” without explaining what that market is. And it defined “personal social networking” to exclude things like professional networks (LinkedIn) or video-sharing sites (YouTube).To give the FTC its due, delineating digital markets is devilishly tricky. Like Facebook, most social-media firms do not charge users, so the typical approach of looking at an industry’s consumer-derived sales is no use. Facebook does have paying customers, firms that buy ads on its platforms, but the extent of that market, too, is hazy. If all American online advertising counts, its share is 25%, according to an estimate by The Economist (see chart). Looking just at social-media advertising it does rise to 60% in America (though globally Facebook’s share is declining). But what qualifies as social media is amorphous, as features and rivals pop up and fizzle.The judge conceded that Facebook has market power (“no one who hears the title of the 2010 film ‘The Social Network’ wonders which company it is about”) and he has given the FTC 30 days to show this more precisely. However, he also threw out one of the agency’s core claims. The FTC accused Facebook of stifling competition by blocking rivals from its platform. According to Supreme Court precedents, the judge pointed out, such conduct is legal: monopolists have no “duty to deal”.That may make sense in the analogue world. Critics like Ms Khan argue that in the digital one, where dominant platforms look a lot like pipe-owning utilities, it amounts to a licence to kill competition. If more cases against big tech stumble—as may happen to those involving Apple and Google—that would lend weight to demands to reform antitrust laws. Even this may not be enough to get any of the six bills, or anything like them, passed by the gridlocked Senate. Despite a bipartisan consensus in Washington that big tech is too powerful, Democrats and Republicans are unlikely to agree on the details of what to do about it. ■This article appeared in the Business section of the print edition under the headline “Is Facebook a monopolist?” More