Yahoo Pulls Plug on Business Operations in China

US web service provider Yahoo pulled out of China this week for “increasingly challenging legal and business environment”.

Yahoo is the latest technology company to stop operating in China, after other companies, that has criticized the increasingly hostile business environment promoted by the government.

The news could spur a continued exodus of companies from the world’s most populous country as regulations continue to tighten and businesses that continue to operate in China need to know the rules. which the government expects companies to follow.

Why does Yahoo ship from China?

Although Yahoo ended its mainland China operations this week, this article has been around for a while – Yahoo News and Yahoo Mail, for example, haven’t been in China for at least a while. seven years.

The company also closed its Beijing office – which mainly deals with research and development – since 2015, leaving 300 employees out of work. Around the same time, Yahoo also sold its stake in Alibaba, the Chinese e-commerce platform, after becoming one of the first investors to take the company’s potential seriously.

“Yahoo remains committed to protecting the rights of its users and the free and open internet. We thank our users for their support” – Yahoo.

Now, however, Yahoo no longer sees China as a ripe place for investment or expansion opportunities. Chinese visitors to Yahoo’s website will be greeted with a message stating that their content is unavailable. If you, your employees, or your business rely on Yahoo services in China for business, you will have to use a VPN to connect to the server in a country where Yahoo is still operating.

Is China becoming a hostile environment for business?

China’s approach to the relationship between business and government has always been different from what Western democracies expect in their societies. But the reason for Yahoo’s move revolves around a recent major crackdown, not only on foreign or US-owned technology companies, but also its own local corporations.

The Personal Information Protection Law (PIPL) – part of China’s sweeping five-year plan to regulate the economy – was recently passed by the government. All companies that process Chinese citizens’ data must now be present in China.

While Western democracies generally try to limit government influence to pick up the pieces as things go on, the Chinese authorities play a much more active role in this. control the market towards certain goals.

It is not radically different from some of the data protection initiatives already in place in Europe and the UK – such as the GDPR – and it is unclear how it will be implemented, but the government’s attitude towards Censorship, data and surveillance mean very few businesses are compliant around to find out.

China has Cryptocurrency trading ban, indicating many of the country’s most popular stock trading apps is illegal, cause Shares of a large taxi company plummeted after accusing it of illegally processing customer data. The game industry is also facing regulations change industry. It’s rarely difficult to run a free tech company in the country – and this is exactly what the state wants.

“If you are an online game creator who wants to operate in China, you have to implement a facial recognition program, because companies have to know if the game players are 18 or under… Violating this law means facing staggering penalties, and no foreign company wants to take this risk.” – Nabat Garakhanov, Digital Media Specialist.

Market intervention in China is very different from most Western countries; while liberal democracies focus on maximizing market efficiency by allowing firms to transact without excessive government intervention, Chinese private sector activities have closely related to things like the government’s national development goals.

The emergence of private companies on the Chinese stock market is subject to the goals and strategies of the central government in a way that entities operating in the Western private sectors would find overbearing.

If your business has a branch or office in China, you’ll have some big decisions to make about whether you want to continue operating under the new regulations. If you decide to do so, then you will need a business strategy that strictly adheres to the government’s five-year plan.

Are other companies joining Yahoo?

Last month, Microsoft pulled Linkedin out of China but confirmed it would create a country-specific job listing app that would comply with new compliance standards – shortly after a report was released. that some Scholars have been blocked from using the website.

Epic Games, the company that produces extremely popular video games Fortnite, also confirmed that it would be shutting down in China on November 15. The Chinese version of the game, called ‘Fortress Night’ and much less violent than the Western version, never made it past the stage. beta test as well as not approved by Chinese regulators.

If you want to access Yahoo and you are currently on a business trip or vacation in China, then you will need a VPN. VPN will keep you safe and secure and unblock websites by masking your IP address and connects you to different servers in countries where Yahoo. However, in a country like China, you’ll want a VPN that can mask the fact that you’re even using a VPN because the technology is so limited. Yahoo Pulls Plug on Business Operations in China

Caroline Bleakley

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