Big tech is investing billions into Southeast Asia’s AI potential
Microsoft, Amazon and Google are scaling to meet increased demand for cloud computing—but will local companies thrive?
Welcome back,
I was back in Hong Kong for the first time in five years last week for the inaugural Bitcoin Asia event, and the many spin-off and side events that sprung up around the two-day show.
My former TechCrunch colleague Rita Liao recently wrote that Hong Kong is gaining momentum as a location for Web3 companies, and not just those who are local or linked to China, and there was certainly plenty of evidence of that with the government and big tech present at events. What struck me more, though, was that Hong Kong doesn’t seem as vibrant as it was before. It may be a reflection of the general change in times and maybe even a little rose tinted remembrance from me.
On to this week’s email—there’s plenty on US government tech policy but also a look at a revival of sorts in Southeast Asia.
Best,
Jon
PS: Follow the Asia Tech Review LinkedIn page for updates on posts published here and interesting things that come our way. If you’re a news junkie, the ATR Telegram news feed has you covered with news as-it-happens.
News in focus
Big tech is investing billions into Southeast Asia’s AI potential
Microsoft made a major investment push in Southeast Asia as it announced it would invest $1.7 billion into cloud and AI technology in Indonesia. CEO Satya Nadella took a personal tour to the region which also included visits to Thailand, where Microsoft announced its first regional data centre for the country, and Malaysia, where he announced his firm would invest $2.2 billion over the next four years.
These investments are part of growth that Microsoft believes could add as much as $1 trillion in value to the region by enabling AI and boosting cloud computing capacity.
“Even in Thailand, double-digit growth of over $100 billion plus can be driven, because of the productivity curve that can be bent by AI,” Nadella said during his time in Bangkok.
Microsoft’s moves follow recent efforts from Amazon to scale up in Southeast Asia to meet growing demand. Japan has benefited too, as we noted last month.
Microsoft inked a deal to invest $2.9B towards AI and cloud infrastructure in the country over the next two years. It will set up an AI lab and work to ‘upskill’ 3M people. Amazon and Microsoft have made similar deals across Asia, but this is Microsoft’s biggest push into Japan. Google is also pledging to spend $1B to boost Japan via two new subsea cables that will improve connectivity and the resources that underpin the development of AI and other technologies.
Facebook, Google and others previously wooed Southeast Asia as markets where they could monetise hundreds of millions of users. Will this ‘new era’ of interest from big tech firms support location innovation or will global firms—from the West and even China—benefit from this expected AI and cloud boom?
TikTok files lawsuit in response to potential US ban
TikTok and its Chinese parent company ByteDance countered President Biden’s newly signed law to block or force a sale of TikTok, as had been expected.
The companies filed their lawsuit in the U.S. Court of Appeals for the District of Columbia Circuit, arguing that the law violates the U.S. Constitution on a number of grounds including running afoul of First Amendment free speech protections.
Hold tight because EU Commission President Ursula von der Leyen has hinted that TikTok could be banned in the European Union, too.
Elsewhere: ByteDance sold its gaming unit to Tencent as part of ongoing consolidation
Biden cracks down Chinese and Russian access to AI
After blocking access to key chip-making tech, the Biden administration is now looking to restrict access to US AI technology from China and Russia, according to Reuters.
The Commerce Department is considering a new regulatory push to restrict the export of proprietary or closed source AI models, whose software and the data it is trained on are kept under wraps, three people familiar with the matter said.
In related news: Huawei’s laptop business is under threat after the US revoked Intel and Qualcomm chip export licences
Chinese e-commerce scam tricks 800,000 consumers
More than 800,000 consumers across Europe and the US were victims of a network of fake e-commerce sites that originated from China and purported to sell designer goods, toys and other items at discounted prices.
The scam is thought to be one of the largest of its kind ever. Customers received fake goods, incorrect items or nothing, but handed over credit card details and other data.
In other hacks: A payroll system used by Britain’s military was targeted in a cyberattack which it is alleged was orchestrated by China
China
Huawei's latest high-end phone features more Chinese suppliers, including a new flash memory storage chip and an improved chip processor, a teardown analysis showed, pointing to the progress China is making towards technology self-sufficiency link
China’s AI boom is happening now—four generative AI startups raised money at valuations of over $1B in the last three months, leading a pack of more than 260 companies vying to emulate the success of US rivals such as OpenAI and Anthropic link
Deepfakes of your dead loved ones have become a booming business in China link
China is now reportedly home to 369 unicorns, with an average value of US$3.B led by AI and semiconductor firms link
Self-driving firm Momenta filed confidentially for an IPO in the US that could happen this year and is aimed at raising $200M-$300M link
Tesla is seeking a robotaxi license to test its self-driving car software on Chinese soil link
China updated its State Secrets Law for the first time in a decade to give itself the power to compel big tech firms to take action if their users post sensitive information link
China’s state-sponsored disinformation campaign has been running at a massive scale for seven years—but no one is looking at it link
Huawei is secretly funding cutting-edge research at American universities including Harvard through an independent Washington-based foundation, according to a Bloomberg report—the company is the sole funder of a research competition that has awarded millions of dollars since its inception in 2022 and attracted hundreds of proposals from scientists around the world, including those at top US universities that have banned their researchers from working with the company link
Huawei’s profit in Q1 jumped over 500% year-on-year to reach $2.7B, according to company filings—that’s the fourth consecutive quarter of rising profit link
US has moved to bar Huawei and other Chinese telecoms firms from certifying wireless equipment link
TikTok claims its Shop product now has over 500,000 US sellers six months after its local launch—worldwide TikTok Shop has over 15M sellers link
Kuaishou, China’s second largest short video app, has shuttered a fledgling gaming studio project link
China's ad-hoc tech pipeline is fueling Russia's Ukraine war efforts link
India
Data collaboration software startup Atlan raised $105M at a valuation of $750M led by Singapore's sovereign wealth fund GIC and US-based venture investor Meritech Capital link
OYO, which SoftBank and others once valued at $10B, is said to be raising at a valuation that could be as low asf $2.5B link
Shopee-parent Garena is quietly making India-themed games even as a relaunch of its smash hit Free Fire game, banned more than 2 years ago, remains doubtful link
Mindgrove, a fabless semiconductor startup backed by Peak XV among others, launched what it claims is India’s first commercial high-performance SoC—it is designed for IoT devices and will likely cost 30% less than other chips in similar segments link
WhatsApp gives India an ultimatum on encryption link
Ola let go its CEO Hemant Bakshi go less than 4 months after his arrival—the exit is part of cutting 180 jobs to improve profitability, according to founder Bhavish Aggarwal link
Tribe Capital’s new SPV is set to put $75 million more in Shiprocket link
AI startup Nintee, backed by investors such as Peak XV, has shut shop after deciding it couldn’t reach VC scale with its business link
PharmEasy raised $216M by MEMG and existing investors at a valuation of $710M, down 90% from its peak worth link
Southeast Asia
Thai food delivery app Line Man Wongnai—formed via a merger between two rivals—has again said it is planning to go public, potentially in Thailand and then the US link
GoTo reported a narrower quarterly loss ($6.3M) after offloading its e-commerce business to TikTok to accelerate cost reductions link
Vidio, Indonesia’s streaming platform, aims to double its paid subscribers to 8M in the next 2-3 years ahead of plans to go public but not before it raises new funding link
The FTC is fining Razer for selling masks it “falsely claimed” were N95 certified link
Alibaba plans to build a Vietnam-based data center to follow local storage law link
Japan
SoftBank is reportedly in talks to buy Graphcore, a semiconductor company from the UK once valued at $2.8B which could boost its AI push link
That’s part of a wider move from SoftBank founder Masa Son towards AI and chips rather than investment—SoftBank has written down billions in valuations from startups it had invested in link
Intel is partnering with 14 companies to automate certain back-end chip processes link
South Korea
AI chip design firm DeepX raised 110B won ($80M) at a valuation of $510M led by Skylake, the firm of a former Samsung chip pioneer executive link
Naver is reviewing options for its holding in the operator of Line, Japan’s most popular messaging app, following pressure from Tokyo link
SK Hynix says its high-bandwidth memory (HBM) chips used in AI chipsets were sold out for this year and almost sold out for 2025 as businesses aggressively expand AI services link
Samsung has reported chip profits after a year of losses thanks to an AI boom drives a fourfold surge in overall income link
Hyundai is spending nearly $1B to keep its self-driving startup Motional alive link
Across the rest of Asia
Taiwan’s King Yuan Electronics Co (KYEC), one of the world’s largest semiconductor testing and packaging services firms, has divested its entire stake in a subsidiary at manufacturing hub Suzhou, in eastern Jiangsu province, as part of efforts to exit mainland China amid geopolitical tensions and cross-strait chip supply chain changes link
Uber has ceased operations in Pakistan link
Thank you for sharing. The momentum of Web3 companies in Hong Kong is strong, but the overall vibrancy is not as it once was. AI investments in Southeast Asia are driving regional technological innovation. TikTok is in conflict with the government, Huawei continues its struggle with the US, and technological development in Southeast Asia and South Asia is advancing rapidly.