Several big names in tech have left China in recent months. Google, Amazon, Facebook and several other large IT companies are already “banned” in the country. The year 2021 saw more and more foreign tech companies withdraw or reduce their operations in mainland China. I wonder what prompted some American companies to end their operations in China, read on to find out and more:
What did Yahoo say when they left China?
Yahoo Inc recently suspended its services in China amid an “increasingly difficult” legal and business environment. “Given the increasingly difficult business and legal environment in China, Yahoo’s suite of services will no longer be accessible from mainland China as of November 1,” the company said in a statement.
Microsoft’s LinkedIn shut down part of its China operations in October
In October, LinkedIn, Microsoft’s professional networking platform, announced that it would shut down the Chinese version of its website this year and replace it with a jobs site without social networking features.
Fortnite maker Epic Games to pull out of China by end of November
Video game maker Fortnite Epic Games has announced that it will be removing the game from the Chinese market starting November 15. The game was launched in China through a partnership with China’s largest games company, Tencent, which has a 40% stake in Epic. .
What’s the Big New Reason for the Recent Exit of China’s IT Companies
As of November 1, the Personal Information Protection Law entered into force in China. It limits the amount of information businesses are allowed to collect and sets standards for how it should be stored. The new law increases compliance costs and adds uncertainty for Western companies operating in China. Companies caught breaking the rules could be fined up to 50 million yuan ($ 7.8 million) or 5% of their annual revenue.
U.S.-China tech and trade struggle is hurting IT companies
The downsizing and departures also come as the United States and China compete for technology and commerce. The United States has placed restrictions on telecommunications equipment giant Huawei and other Chinese tech companies, alleging they have ties to the Chinese military and government. Businesses on both sides are feeling the heat of these trade tensions. China’s data laws also state that companies operating in the country must transmit data when requested by authorities. This makes things difficult for Western companies, as they may also face pressure at home to give in to demands from China.
Why Facebook and Twitter are banned in China
China operates what is called a Great Firewall which uses laws and technologies to enforce censorship. Content and keywords deemed politically sensitive or inappropriate should be removed from the Internet. Businesses need to control their own platforms, removing posts and making sensitive keywords un-searchable. Due to this, Western social media networks such as Facebook and Twitter have long been blocked and are generally not accessible to people in mainland China. Chinese alternatives have emerged over the years to fill the void left by the absence of Facebook, Twitter and other social media platforms.
What are the rivals of Google and WhatsApp in China
Baidu is China’s most popular search engine, it rivals Google. Messaging apps like WeChat are used instead of WhatsApp or Messenger. Weibo, a microblogging platform, is the closest equivalent to Twitter.