If you don't have time to view it (which is ridiculous), the summary is thus. China is commissioning the predominant social media partnership to gamify adherence to their Communist Party. Sesame Credit monitors your social media presence, rewarding you for repeating state propaganda and punishing you for asking questions or talking about matters the government disapproves of; it monitors your shopping, rewarding you for buying food and work clothes, punishing you for shopping for imported or frivolous merchandise; it monitors your friends, punishing you for associating with dissenters and agitators. While there are no stated punishments for low-score players, currently, many bloggers and analysts are projecting what these could be: anything from restricted online use to ineligibility for real-world employment.
And it's being rolled out now, with plans to become mandatory for all citizens in five years, as of this writing.
This sounds like dystopian sci-fi, so I undertook to research this as much as is available to me.
Who Is Tencent?
Tencent Holdings Ltd. is a 17-year-old investment holding company in Shenzhen. It competes with LINE/Pick and Amazon (among many others) to provide entertainment media over the Internet and mobile services. It used to compete with Alibaba, but in 2015 they combined their Didi and Kuaidi services (Uber-like apps) and then their Meituan and Dianping startups, each move being significant in terms of online power aggregation. Alibaba, it should be noted, is larger in China than Amazon is in the U.S.
Tencent has its own search engine, they distribute music, provide MMOs (formerly South Korean; now they produce their own), offer instant messaging and cloud storage, arrange payment schedules for utilities and mass transit use, among many others services, many of which are amplified with in-game purchases or subscriptions. Its WeChat app is rapidly expanding for global usage.
Tencent has majority interest in Riot Games (League of Legends) and minority stakes in Epic Games (Unreal), San Francisco's GLU Mobile (mobile gaming) and Pocket Gems (mobile developer), among others. It owns 12% of Activision Blizzard (World of Warcraft) shares and has secured a deal for exclusive distribution with HBO as well as streaming rights in China for NBA games. Tencent's chairman, "Pony Ma", is notorious for his quote, "To copy is not evil". Tencent has been accused of being unable to innovate, only imitating the services of others—their Tencent Weibo, for example, was created a year after Sina Weibo, the Chinese version of Twitter.
It should be clear Tencent is an ambitious, diverse, powerful company that is still growing.
|Image: China Internet Watch|
Not to be confused with California "credit advocate and loan expert" Credit Sesame, Sesame Credit is one of eight existing "social credit" systems that monitors Chinese citizens' credit score. This scoring system, rating consumers on a scale of 350 to 950, was introduced in summer 2015 and is connected to citizens' national ID cards. All Chinese citizens have access to view everyone else's credit scores, through Credit China; to date, however, 100,000 citizens have already volunteered and advertised their credit scores over various weibo (microblogging) services.
Alibaba and Tencent control the vast majority of social media and online services in China; through this, they enjoy free access to all available demographic, behavioral, and shopping trends data, to say the least. Sina Weibo, for its part, has endured an ongoing struggle with the Chinese government: while its popularity increases with free speech, the government employs censors and issues lists of censored words at turns to control the exchange of information and limit anti-revolutionary behavior.
Gamifying one's social credit score, a technique that incentivizes toeing the party line, may be a convenient way to reduce policing behavior for the government. People who enjoy the app may begin to stifle their more controversial thoughts, and users who disagree entirely will simply fall silent, both to protect their credit score and under pressure from their acquaintances.
Implications of Sesame Credit
A credit score of 600 qualifies for an instant loan of $800; at 700, "a citizen is fast-tracked for a Singapore travel permit". [Computerworld]
A credit score of 650 lets you rent a car without a deposit; at 750, "you get a similar fast track to a coveted pan-European Schengen visa." [Private Internet Access, Xinhua]
Your credit score, linked to your national identification, goes down if you post on social media about dissenting political views (or even correct ones without a permit), discussing history that isn't state-approved, reporting on externally verifiable stock information.
Your credit score will go down if you associate with people who do this, too. This means you have the choice of pressuring your friends and family to conform, or to isolate and abandon them. It will be interesting to see whether the pressure of Sesame Credit can override Confucian values of filial piety or the cultural values that place the community above the individual.
The State Council Notice intends to add sanctions for low-scoring users, ranging from limited Internet access to being blacklisted from influential positions (e.g., reporter, CEO, government).
Tencent and Alibaba have the leverage to punish users who use rival browsers, rival online markets, and rival online payment programs. Alibaba's Alipay is implementing the "Credit Visa" system that circumnavigates travel paperwork commensurate to a high credit score (over 700). This means people with low credit scores are effectively locked within their nation's borders.
Buying produce and work clothes will increase one's credit score, while buying foreign products or even video games will reduce it. How will Chinese entertainment companies adjust their practices to regain favor with the government—or is this how Alibaba and Tencent establish their monopoly? The reasoning behind this is that someone who plays video games will be seen as contributing little to society and a bad credit risk, while someone who has diapers and baby formula on their record will be valued as a consumer.
As this is a mobile app, there is nothing to stop Sesame Credit from tracking users via GPS (as for many phones, the GPS never shuts off and the battery can never be removed) and modifying their credit score, improving it if they attend state-approved political rallies or museums, or downgrading it if they travel through areas the government deems hostile, like demonstrations. How long before some young entrepreneur also develops an app that maps the shifting regions that boost or hurt your Sesame Credit score? This could be updated by users who report what they notice happening to their scores, as well as informed by the government of where users should be hanging out. As well, this function could track what other users you physically visit: even if you're no longer connected to a low-score user through the app, your GPS could record where, when, and for how long you visit this user in real life.
Chinese news outlet Xinhua has nine tips for improving your Sesame Credit score:
- Pay your credit card promptly, so your phone is always ready to receive text messages and updates.
- Avoid neglecting your debt, and especially avoid bankruptcy.
- Support the welfare of your local environment, and empower others to help themselves.
- Don't fight with your girlfriend. This may lead to being overcharged on telephone calls or frequently changing your phone number, which makes it hard to track your account.
- Stay put. Don't go wandering around needlessly.
- Remain in good standing with your utilities bills. These services will not hesitate to cut off your water or gas.
- Take care of your parents and children, attend to your spouse. Make sure they don't go making reckless online purchases you might be responsible for.
- Open more credit card accounts! Use them all the time!
- "Birds of a feather flock together": only associate with friends who also have great credit scores. Your slacker friends will bring you down in more ways than one.
My wife sent me Extra Credit's excellent examination and summary of the Sesame Credit story, because she couldn't believe it was true. She hoped, in my research, I'd discover it was a gross misinterpretation by sensationalist Western media. I haven't found anything like that: it seems to have been quite public information since last year, with a flare-up of attention this October, but no one has broken any story indicating this isn't actually going to happen.
Someone at Tech in Asia, however, wrote an opinion piece in which they lightly mock the ACLU's alarmist interpretation of the story. The writer, Charlie Custer, is incensed that Western media is conflating Alibaba's Sesame Credit, Tencent's proprietary credit score, and the credit scoring system of the Chinese government. He really needs everyone to understand these are three distinct things, though this fact doesn't contradict the substance of everyone's concern.
Custer also misrepresents the visa issue, claiming that people are upset that China will hand out travel visas for users with high credit scores. No one has said this: we're all very clear that it's only the application paperwork that gets reduced for those who play the game well. Custer also states he cannot find any corroborating evidence to support the claim that Tencent's credit score system rewards behavior in line with state propaganda.
Yet China's outline for a social credit system—which Custer has read and links to—is unmistakably moralistic, with several passages that state the intent to guide citizens toward loyalty to the state and to bolster community support, including compilation and review of civil servants' "sincerity manuals" and the establishment of "morality classrooms". The document iterates these goals, but does not explicitly describe how these will be practically achieved.
Perfect social public opinion supervision mechanisms, strengthen disclosure and exposure of trust-breaking acts, give rein to the role of the masses in appraisal, discussion, criticism and reports, shape social deterrence through social moral condemnation, and censure trust-breaking acts of members of society.He's right when he suggests a lot of the commentary on this topic reaches hyperbolic tones, but perhaps we can be excused for that. The idea of a morality index that modifies the credit score attached to your national identification is rather exciting to the imagination.
June 14, 2014: Planning Outline for the Construction of a Social Credit System (2014−2020) (China Copyright and Media)—The original State Council Notice, a detailed blueprint for the formation of the social credit system, translated from Chinese.
Jan. 29, 2015: Alipay Launched China's First Credit Agency (China Internet Watch)—Reiterates all known information and implications of Sesame Credit.
June 7, 2015: Do you have 750 Sesame points for a Luxembourg visa? (Xinhua)—Chinese-language article, outlines and stresses the benefits to Sesame Credit's "Credit Visa" system, fully anticipating cooperation with South Korea, Japan and the UK. It indicates some businesses are offering bargains and interest-free loans to users. The article does not mention actions that will reduce one's credit score; it suggests shopping on Taobao (an Alibaba subsidiary) to improve it.
July 13, 2015: What Alibaba’s New “Credit Visa” System Means For Overseas Chinese Travel (and Why Brands Should Care) (China Luxury Advisors)—Sesame Credit grants travel privileges to high credit scores, including obtaining the elusive Schengen visa. The higher the score, the fewer supporting documents one is required to produce for a visa.
Oct. 3, 2015: In China, Your Credit Score Is Now Affected By Your Political Opinions – And Your Friends’ Political Opinions (Privacy Online News)—Pointed summary of Sesame Credit and the details of its account.
Oct. 5, 2015: China's Nightmarish Citizen Scores Are a Warning For Americans (ACLU)—The Chinese government is leveraging online purchase data and social media to monitor citizens and influence behavior.
Oct. 7, 2015: ACLU: Orwellian Citizen Score, China's credit score system, is a warning for Americans (Computerworld)—Reiterates all known information and implications of Sesame Credit.
Oct. 9, 2015: All Chinese citizens now have a score based on how well we live, and mine sucks (Quartz)—A journalist submits himself to the Sesame Credit scrutiny to see what this means for his life. He learns his credit score is rated poorly, and any benefits he would receive require enrolling for the program. He also outlines the five categories by which users are evaluated for scoring. He also learns how users are figuring out how to game the system.
Oct. 26, 2015: China 'social credit': Beijing sets up huge system (BBC)—Points out eight distinct credit score programs, attributes Sesame Credit to Alibaba with no mention of Tencent. Interviews a matchmaking service that refuses to answer questions out of fear of reprisal. Emphasizes how citizens seem to love Sesame Credit, in practice, quoting a blogger who suggests it is necessary.
Nov. 30, 2015: China's plan to put two-faced citizens on credit blacklist isn't all that foreign (The Conversation)—Opinion piece that projects how Sesame Credit may manipulate or override social trust in China, and what this would mean if it were implemented in the U.S.
Dec. 9, 2015: Privacy, Internet Issues Cloud Credit Scoring (Caixin Online)—Details which Chinese financial firms will be licensed to determine credit ratings, based on the information they have access to.
Dec. 17, 2015: Gamified compliance: China's reputation network Huxleys to the full Orwell (BoingBoing)—Reiterates all known information and implications of Sesame Credit.
Dec. 22, 2015: Sesame Credit—when companies and politics combine to make the people submissive (Sachwert Magazin)—Opinion piece emphasizing the insidiousness of a state-controlled morality program enforced by financial repercussions.
Updates: recast awkward paragraphs; new link to BBC article; added Refutation? section.