By Steve Stecklow and Jeffrey Dastin
LONDON (Reuters) – Amazon.com Inc was marketing a collection of President Xi Jinping’s speeches and writings on its Chinese website about two years ago, when Beijing delivered an edict, according to two people familiar with the incident. The American e-commerce giant must stop allowing any customer ratings and reviews in China.
A negative review of Xi’s book prompted the demand, one of the people said. “I think the issue was anything under five stars,” the highest rating in Amazon’s five-point system, said the other person.
Ratings and reviews are a crucial part of Amazon’s e-commerce business, a major way of engaging shoppers. But Amazon complied, the two people said. Currently, on its Chinese site Amazon.cn, the government-published book has no customer reviews or any ratings. And the comments section is disabled.
Amazon’s compliance with the Chinese government edict, which has not been reported before, is part of a deeper, decade-long effort by the company to win favor in Beijing to protect and grow its business in one of the world’s largest marketplaces.
A 2018 internal Amazon report outlining the company’s activities in China details a number of “fundamental issues” the Seattle-based giant has faced in the country. Among them: “Ideology and propaganda are at the center of the Communist Party’s toolbox. to achieve and maintain its success,” the document states. We don’t judge whether it’s right or wrong. “
This briefing paper and interviews with more than two dozen people who have been concerned about Amazon’s operations in China, reveal how the company survived and thrived in China by helping to advance the ruling Communist Party’s global economic and political agenda, while rejecting some government demands.
In a central detail of this strategy, the internal document and interviews show that Amazon partnered with a branch of the Chinese propaganda apparatus to create a sales portal on the company’s U. S. site. In the U. S. , Amazon. com, a task that is known as China Books. The company, which eventually submitted more than 90,000 posts for sale, did not generate significant revenue, but the document shows that Amazon deemed it very important to win in China as the company expanded its Kindle e-book, cloud computing and e-commerce. enterprises.
The 2018 briefing document spells out the strategic stakes of the China Books project for Jay Carney, the global head of Amazon’s lobbying and public-policy operations, ahead of a trip he took to Beijing. “Kindle has been operating in China in a policy grey area,” the document stated, and noted that Amazon was having difficulty obtaining a license to sell e-books in the country.
“The key detail to protect” against its license with the Chinese government “is the Chinabooks project,” the document says.
The document noted, “The draft of the books Amazon. com/China has gained great popularity among Chinese regulators. “
LIFE IN XINJIANG
The books come with many apolitical titles, such as Chinese textbooks, cookbooks, and bedtime stories for young people, but they also come with headlines that magnify the official Communist Party line.
One book extols life in Xinjiang, where United Nations experts have said China interned one million ethnic Uyghurs in a network of camps. The book – “Incredible Xinjiang: Stories of Passion and Heritage” – discusses an online comedy show situated in the region. The book quotes an actor who plays a Uyghur “country bumpkin” saying that ethnicity is “not a problem” there. That echoes the position of Beijing, which has denied mistreating minority groups.
Some books portray China’s battle against the COVID-19 pandemic, which began in the Chinese city of Wuhan, in heroic terms. One is titled “Stories of Courage and Determination: Wuhan in Coronavirus Lockdown.” Another begins with commentary from Xi: “Our success to date has once again demonstrated the strengths of CPC (the Communist Party of China) leadership and Chinese socialism.”
China International Book Trading Corp, or CIBTC, state-owned by Amazon, told Reuters the company is a “business that dates between two companies. “China’s National Press and Publications Administration, or NPPA, the state propaganda arm Amazon has married, had no comment.
In response to questions, Amazon said it “complies with all applicable laws and regulations, wherever we operate, and China is no exception.” It added that “as a bookseller, we believe that providing access to the written word and diverse perspectives is important. That includes books that some may find objectionable.”
Amazon said it has “a wide variety of books” about China, and China Books “is one more channel to serve our Chinese readers in the United States and elsewhere. “CIBTC is “just one of the millions of trading partners worldwide. who will be offering products in our stores. “
The new main points of Amazon’s strategy in China demonstrate the demanding situations faced by Western corporations to access the world’s most populous market and to deal with an authoritarian regime that is hardening public discourse.
The company’s commitments to Beijing contrast with its efforts to circumvent regulators in the world’s two largest democracies. In India, Reuters this year documented how Amazon circumvented local regulations and, to advertise its own brands, manipulated search effects on its Indian website. , Reuters explained how Amazon got rid of or got rid of state privacy spending designed for consumers.
Amazon said it has complied with Indian law and does not favor its personally branded products in the search for results. As for the U. S. , the company said it prefers U. S. federal privacy law. USA And it protects consumers’ privacy and doesn’t sell their data.
Some companies have responded to Beijing’s demands by leaving the market. Yahoo recently exited China and Microsoft Corp’s LinkedIn announced it would pull out some of its services. Both cited the country’s difficult business environment and regulatory requirements.
Amazon, on the other hand, has strong economic strength in China in recent years, providing lucrative export opportunities to thousands of Chinese corporations while creating its own industry-leading cloud facilities unit. Amazon Web Services, or AWS, is now one of the largest suppliers to Chinese corporations in the world, according to a report released this year through analytics firm iResearch in China and others who have worked for AWS.
Still, by 2018, Amazon was receiving an “increasing number of requests from (Chinese) watchdogs to take down certain content, mostly politically sensitive ones,” stated the briefing document prepared that year for Carney. He previously served as communications director for U.S. President Joe Biden, when Biden was vice president, and as press secretary for President Barack Obama.
Amazon declined to make Carney available for an interview.
According to the briefing document, the Cyberspace Administration of China, or CAC, asked Amazon in 2018 to take down a “link to China’s new blockbuster film Amazing China because of especially harsh user reviews.” The CAC is responsible for online security and content regulation.
“Amazing China” praises the country’s accomplishments since Xi became president in 2013. CAC wanted the link removed from IMDb, an Amazon-owned website of movie information and reviews.
Amazon’s China office responded to CAC that “it is difficult for Amazon China to accommodate such requests, and we’ll relay the message to” Amazon headquarters “and seek their views about possibilities,” the briefing document stated.
The film remains on IMDb’s U.S. website. Shortly after the request, some negative reviews disappeared, archived screenshots of IMDb.com on archive.org show. Others remain, and “Amazing China” currently has an overall rating of just 2.3 out of a top score of 10. Some reviews call it “pathetic,” “garbage” or “government propaganda.”
“Some reviews submitted for the title ‘Amazing China’ were removed because they violated our user review content guidelines, with the majority being off topic,” Amazon told Reuters. “IMDb is not aware of any request from external parties (including the Chinese government) to do anything about reviews for this title.”
CAC didn’t respond to a request for comment.
‘WINK AND A NOD’
Amazon entered China in 2004 through a $75 million deal to acquire Joyo.com, an online book-and-media seller. Eventually, Amazon wanted to introduce e-books and its popular Kindle reading devices to the Chinese market.
To accomplish that, it worked with the General Administration of Press and Publication, or GAPP, a regulator that engages in state censorship in its role as overseer of publications in China. NPPA now handles most of GAPP’s responsibilities. NPPA, in turn, is overseen by the Communist Party’s Publicity Department, which was previously known as the Propaganda Department.
According to a former Amazon executive involved in talks with China, the company secured some, but not all, of the government approvals it needed to sell Kindle devices and e-books. That situation gave the government leverage over the retailer, the former executive said. Amazon’s public-policy team came up with the China Books project as a novel way “to get what we wanted on Kindle and other things,” the person said. “It was a wink and a nod.”
Amazon soon began working with GAPP to set up China Books, according to the briefing document. The company planned to tout the portal to Chinese authorities as Amazon’s only store named after a country, the document said. Amazon dedicated several employees to the effort, which involved CIBTC, the government book-trading company, which the document described as “the executing body from GAPP.”
A photograph on CIBTC’s website shows Chinese officials toasting the launch of the project at a hotel in Beijing in September 2011.
In October 2012, China Books was awarded the title, “a key national culture export” project, by a group of Chinese government bodies, including GAPP, as well as the entity now known as the Publicity Department of the Communist Party of China. Two months later, Amazon launched its electronic-books business in China and soon began selling Kindles.
By the end of 2017, China had become Kindle’s largest global market, “accounting for 40%+ of our world device sales volume,” according to the 2018 briefing document. By then, Amazon had added a Chinese e-book store to its American website and had translated 19 books.
And Carney, the top public-policy executive who then reported to Amazon founder Jeff Bezos, went to China in April 2018. There, he told an alternate member of the Communist Party central committee that Amazon would make “every effort” to promote China Books and make it “bigger and stronger,” according to a CIBTC press release.
The briefing document prepared for Carney stated: “Both China Books and Kindle Chinese eBook Store are Amazon China’s main commitment to assist China in ‘Going Abroad,’ an umbrella project that aims to promote Chinese culture to the world.”
Amazon’s China Books webpage prominently displays CIBTC’s name, but doesn’t disclose that it’s a project that Amazon created in a partnership with a Chinese government agency.
“Details about the company are readily available online,” Amazon told Reuters, “and CIBTC has placed its name and logo prominently throughout its page. Our relationship with CIBTC is entirely appropriate.”
Eventually, China Books’ allocation failed financially, according to a user who participated in it. Few of the portal’s titles sold well, and Amazon even returned the books because its warehouses didn’t have them.
Nonetheless, the China Books project continues. The Chinese-language version of “Xi Jinping: The Governance of China Volume Three” – is listed first on China Books’ “BEST SELLER” page. It recently showed a sales rank of 1,347,071. Another “best seller,” about COVID-19, was ranked 10,654,483. The Xinjiang title, which Reuters purchased, had been ranked 13,441,455.
But sales weren’t the goal, according to the person who has been involved in the project. “It’s a high-level photo-op,” part of a “soft-power campaign to basically put the books out there and just have it be visible.”
In its statement to Reuters, CIBTC, the government book-trading company, said it doesn’t “rank books sold through Amazon.” It didn’t elaborate.
A THREAT TO ‘RETALIATE’
Amazon continued its Chinese expansion in 2013, announcing the introduction in Beijing of Amazon Web Services, its cloud-computing business. At the time, no Chinese law regulated cloud services, the 2018 briefing document noted.
In 2016, China began taking actions that made it more difficult for foreign cloud-computing firms, such as AWS, to operate in the country.
The government began requiring cloud providers to hold a new license that only Chinese-owned companies could obtain, according to the briefing document. “Regulators have since become very hostile” toward AWS, the 2018 document stated.
The result was that Amazon took an unusual step for the company: It handed off its cloud technology to local companies so it could keep operating in China. The Chinese companies – not Amazon – were responsible for “monitoring and taking down illegal content, collecting and reporting basic information of customers … and working with PRC (the People’s Republic of China) authorities on all compliance-related inquiries that may arise,” the 2018 document stated.
In its statement to Reuters, Amazon said that AWS, as a foreign cloud provider, has to license or sell technology to local partners in China in order to have a presence there.
That structure didn’t shield AWS from Chinese pressure, however.
In February 2018, China’s Ministry of Public Security, or MPS, called AWS to a meeting, the briefing document stated. MPS threatened to “retaliate” against Amazon unless it removed content and blocked a website it hosted in the United States for Guo Wengui, a Chinese dissident. AWS refused, the document said. But the company asked Guo to take an action that exposed the dissident’s Internet Protocol, or IP address, and AWS “provided to MPS” this data, the document stated. An IP address is a unique code that identifies a computer accessing the internet.
The ministry “recognized our effort to find a solution, though not … to their satisfactory level,” the document stated.
The 2018 briefing document advised Carney to raise the government’s request on Guo when meeting a top Ministry of Commerce official in Beijing, and stress that China shouldn’t make requests that involve data stored abroad.
Asked about the Guo incident, Amazon confirmed it received the Chinese government’s request, but said it “did not provide any non-public information or any other customer information.”
The commerce ministry said Guo wasn’t discussed at the meeting with Carney. Amazon didn’t say whether Guo came up.
An employee for MPS said the ministry doesn’t respond to requests for comment. An attorney for Guo said Guo had no comment.
AWS’s business in China continues to grow. Despite being barred from promoting the cloud to the government and some state-owned companies, AWS has gained key consumers in China, other people familiar with the matter say.
Among them are two Chinese companies, Tiktok developer ByteDance and video-surveillance firm Hikvision, as well as multinationals Nike, Samsung and Philips, according to the 2018 briefing document and a 2019 blog on AWS’s website. Philips declined to comment; the other four companies didn’t respond to requests for comment.
In June, AWS announced it was expanding further in the country, “to support the demands of our growing customer base in China.”
(Reporting by Steve Stecklow in London and Jeffrey Dastin in San Francisco. Additional reporting by the Reuters Shanghai newsroom. Editing by Peter Hirschberg.)