China Central Television's (CCTV) annual Lunar New Year Gala, arguably the most-watched TV program in the world, has historically drawn more than a billion views worldwide and millions of advertising dollars from big Chinese tech firms.
But this year's extravaganza had no mention of companies like ByteDance or Alibaba; instead, viewers were flooded with ads for booze. In fact, it is the first time since 1984 that the Gala did not organize a primary sponsorship, and it is the first time since 2015 that a big tech firm has not monopolized its sponsorship.
The absence of big tech advertising comes after years of Beijing cracking down on firms the government considers too powerful.
Often referred to as "China's Super Bowl" the gala is akin to something like Macy's Thanksgiving Parade that families turn on and leave playing in the background during their at-home festivities. The event invites some of China's top celebrities and features choreographed dances, comedy sketches, and live singing performances.
Starting in 2015, big tech companies introduced virtual hongbao or "red envelope" giveaways, in which viewers with the app of the sponsoring company use their smartphone to receive cash prizes during the gala. Alibaba, Tencent, Baidu, Kuaishou, JD.com and ByteDance have used the gimmick, with JD.com — last year's exclusive sponsor — investing more than $230 million into red envelopes.
But there were no hongbao promotions or big tech advertisements this year, according to local media reports. Some mainland analysts have described the absence of big tech sponsorship as the end of the "golden age of the Internet," writing that the gala is now just too expensive to sponsor, with companies facing peaking growth and declining profit.
The last decade has seen Chinese big tech companies grow exponentially, edging into the ranks of U.S. corporations like Apple, Amazon, and Microsoft. The growth has put these firms under Beijing's radar, with the Communist Party's wary of private enterprises becoming too powerful.
The crack down began in 2020, when regulators stopped Jack Ma's Ant Group from going forward with a $37 billion IPO. Over the next two years, the government has curbed the financial growth of 13 other tech giants including Tencent, Baidu, JD.com, and ByteDance.
Last week, Chinese officials said they would tone down regulations going forward, though observers say the future of big tech will look very different from pre-COVID days. Many of the firms were forced to sell shares to government investors, meaning boards will now have Beijing-friendly members.
Xiaomeng Lu, a director of geo-technology at the Euroasia Group, told Semafor that big tech companies could be trying to come off as less "flamboyant" with the central government.
“By not agreeing to a sponsorship...these companies have put out an optic that they are not encouraging consumerism; they're taking a low profile," Lu said. "They're being a good kid."
But she added that this is not an end-all relationship with CCTV, and that she believes the tech firms will continue to buy ad time with regular CCTV programming as a way to show the public that the companies remain "politically safe" with the central government.
The View From United States
Despite China's crackdown and strained relations with its tech firms, Washington has remained wary of ties between Beijing and the companies. Regulators threatened to delist Chinese companies from U.S. stock exchanges unless given access to their balance sheets.
Some tensions seemed to ease when regulators last month announced they had successfully audited companies like Alibaba and Jd.com in Hong Kong.
Still, the Biden administration has maintained and implemented several measures meant to deter American business with Chinese tech companies, including an "entity list" of dozens of Chinese companies U.S. firms need explicit permission from the federal government to conduct business with. The federal government and several state governments have also banned TikTok from government-issued devices, citing concerns about the app accessing user data.