By Liza Lin 

China's technology titans are deploying health-rating systems to help authorities track the movement of millions of Chinese who are preparing to resume work at factories and other businesses, adding a new and controversial tool in the country's battle to contain the fast-spreading coronavirus outbreak.

China's official Xinhua News Agency reported this week that the country's cabinet, the State Council, had instructed Alibaba Group Ltd. affiliate Ant Financial Services Group to explore the nationwide rollout of a rating app to help governments control which people can travel into and around the city during the Covid-19 outbreak.

Alibaba and Ant Financial worked with the government of Hangzhou to develop a smartphone-based system to classify people into three categories of exposure to the outbreak -- green, yellow or red -- based on their health conditions and travel history. Gaming and social-media behemoth Tencent Holdings Ltd. created a similar program for the southern city of Shenzhen.

Ant Financial said in a social-media post that the national system could be launched as early as this week. Tencent is also working with the central government to expand its system nationwide, the company said.

In Hangzhou, users are prompted to enter their personal information and current location when first registering. They then self report their physical condition -- choosing from a list of options such as a dry cough, fever or asymptomatic -- and are asked if they have traveled in the last 14 days or come into contact with suspected or confirmed coronavirus cases in the same period.

The system, operated by the city government through Alibaba's DingTalk mobile messaging platform, then assigns the person a color-coded badge. Those marked as green are given the all clear to roam relatively freely around the city, and are given a QR code to present at checkpoints such as subways, office buildings, malls and other crowded public places when moving about. Staff at these checkpoints will scan or visually check this code and take their temperatures before they are allowed to pass.

Little has been said about the national system so far, and the State Council didn't immediately respond to a request for comment.

China's ruling Communist Party is under intense pressure to restart the country's economy after the outbreak of the fast-spreading coronavirus -- which has infected more than 72,000 people and killed at least 1,868 -- led the government to extend the annual Lunar New Year holiday and impose lockdowns on regions hard-hit by the pathogen. Business in several places has been brought to a virtual standstill.

In a survey released Monday by the American Chamber of Commerce in China of 109 manufacturers, 78% of companies said they didn't have sufficient staff to run a full production line.

In turning to Alibaba and Tencent for help, China's government is exploiting its close relationships with the country's most influential tech companies. By working with the companies, the government can tap computing power and expertise it lacks on its own. The companies, meanwhile, benefit from a government-mandated boost to traffic on their platforms.

Both Alibaba and Tencent have said they have no access to users' health and travel data.

So far, the systems have drawn a mix of praise and scorn. Hangzhou's government said the scheme has made it easier to restart work and factory production while still isolating those infected with the virus. But flaws have led to serious disruptions in the lives of some residents.

Ma Ce, a Hangzhou-based lawyer, said he applied for permission to return from vacation to the eastern Chinese city using Ant Financial's smartphone app.

In the Hangzhou system, people granted green badges can move around the city with relative freedom by flashing their phones at checkpoints. Those given yellow badges must isolate themselves for seven days, while people who come up red are forced to self-quarantine at home for two weeks.

Yellow and red badges are given to those who might have been with a confirmed or suspected coronavirus patient, or who recently traveled to areas severely affected by the outbreak, such as Wuhan, the central city at the epicenter of the outbreak.

Hangzhou's system relies on users to self-report much of the information used to determine their status. Mr. Ma said he hadn't visited highly infected parts of China, nor was he feeling under the weather. Nevertheless, the system gave him a red badge.

"I have no idea how come I am granted a red card under circumstances like this," he said.

Alibaba referred questions about the potential for mislabeling to the Hangzhou government, saying the government was responsible for the system's core operations. The Hangzhou government didn't immediately respond to requests for comment.

Since the health-code system was launched in Hangzhou on Feb. 11, the government has issued more than 7.2 million colored tags, of which more than 6.7 million were green, a Hangzhou official said at a news conference on Sunday. The day before, the city government created an appeal process on its own website for those who believe they have been given the wrong color.

A system that relies on travel restrictions and self-reported data could fail because the stigma attached to being a carrier incentivizes people who have been exposed to the virus to lie about their status, said Peter Daszak, the president of EcoHealth Alliance, whose New York-based organization conducts research into infectious diseases.

The Hangzhou government called out 16 people for lying on their health code application in a social-media post earlier this month, saying it used "big data" to verify the self-reported information. Everyone in the group would immediately be given red tags, it said.

By Feb. 14, the number of people found to have been dishonest on their applications had risen to more than 1,000, officials said in a separate post.

Such apps might be useful in controlling unusually deadly diseases such as Ebola or severe acute respiratory syndrome but are less helpful with outbreaks of diseases like Covid-19 with lower mortality and hospitalization rates, said Ben Cowling, head of the epidemiology and biostatistics division at Hong Kong University's School of Public Health.

In Shenzhen, Tencent rolled out a health-rating system through its massively popular chat messenger WeChat. Residents apply for a health code to be used at checkpoints all across the city, at neighborhood entrances and road blocks as well as in airports and railway stations.

The bar code replaces the use of paper-based records and minimizes human interaction, lowering the risk of the virus spreading within a community, the Chinese technology giant said in a statement on social media.

Multiple calls to the Shenzhen government's propaganda office went unanswered on Tuesday.

Similar systems have recently been adopted in Shanghai, the central Chinese city of Zhengzhou, and in the coastal provinces of Zhejiang and Fujian, according to state media reports. Hangzhou, where Alibaba and Ant are located, is the capital of Zhejiang.

Mr. Ma, the Hangzhou lawyer, said his experience has convinced him the city would be better off using humans to help machines to make such decisions.

"It matters whether or not people can enter a city, or whether or not people get stuck in their apartments," he said.

--Yang Jie and Stu Woo contributed to this article.

Write to Liza Lin at


(END) Dow Jones Newswires

February 18, 2020 12:36 ET (17:36 GMT)

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