“The rising shift to the B2B (business-to-business) market is a ‘win-win-win’ especially in China, for government, internet giants, as well as startup companies,” François Candelon, senior partner of Boston Consulting Group (BCG) said Thursday at the Emerge by TechNode conference in Shanghai.

Central and local governments want to digitize Chinese industries rapidly, Candelon explained, since some of industries have already been left behind. Only 25% of Chinese manufacturers have smart-factory initiatives, compared with 46% in Germany and 54% in the US, according to a joint study by BCG, Alibaba, and Baidu.

Local tech companies have been steering toward B2B or enterprise-facing business over the past year, as the next phase of technology development shifts to industrial uses for the internet. Tencent announced it was restructuring to focus on enterprises, upping efforts in cloud and data solutions in late 2018, while Alibaba seeks to digitize local businesses with a service package of 11 different elements under its A100 program.

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Jill Shen

Jill Shen is Shanghai-based technology reporter. She covers Chinese mobility, autonomous vehicles, and electric cars. Connect with her via e-mail: jill.shen@technode.com or Twitter: @yushan_shen