Beijing [China], September 9 (ANI): Chinese big tech's community group-buying scheme is falling apart as Beijing has toughened its regulation on the country's tech companies.
According to PingWest, one after another, companies of China's once-burgeoning community group-buying industry are falling apart.
"PingWest's Chinese site has exclusively learned that Chengxin Youxuan, the community group-buying e-commerce platform formerly controlled by ride-hailing giant Didi Chuxing, is laying off employees heavily in anticipation of a future sale of the entire business, while other of Didi's community group-buying efforts are also laying off people and shutting down," PingWest reported.
It further reported that the big techs have their big problems, such as heavy cash-burning in the community group-buying business, as well as antitrust criticism and scrutiny from China's market regulators and state media.
While big techs with big war chests can barely maintain afloat amid fierce competition, other participants of the business, especially those whose business has been restructured or even taken away by the big techs, hardly find the burgeoning market prosperous for themselves, PingWest reported.
Meanwhile, China has toughened its regulation on the country's tech companies by passing sweeping new rules about the collection and use of personal data.
The Personal Information Protection Law -- which was approved last month by the Standing Committee of the National People's Congress, taking effect from November 1, prohibits "illegally collecting, using, processing, transmitting, disclosing and trading people's personal information, reported CNN citing Xinhua News.
The full text of the law is not yet public, but Xinhua reported that, among other things, it "clarifies" rules governing the "processing" and "provision" of personal information across borders.
News of the law comes as some Chinese tech firms, including ride-hailing company Didi, have been accused of mishandling user data in recent months.
The Chinese companies ordered the removal of the Didi App from the app store citing data privacy concerns and its stock dipped 30 per cent of its original value just sometimes after many US investors landed billions into it.
And this situation is getting worse, huge Chinese tech giants like Alibaba and Tencent are paying fines against various allegations. The Chinese government is still de-stalling many companies that have raised money from the US market. It has become an admitted fact that all Chinese profit-making firms are under the direct control of CCP.
Earlier, Beijing also called on tech giants to share their information with the authorities and asserting its authority over data held by US companies in China as well.
The Chinese government is now calling on big tech companies like Tencent, online retailing giant Alibaba Group Holding Ltd and TikTok owner ByteDance Ltd to open up the data they collect from social media, e-commerce and other businesses, The Wall Street Journal (WSJ) reported citing official documents and interviews with people involved in policy-making.
China's leaders worry that the country's tech giants could be using their extensive personal and corporate digital records to build alternative power centers in the one-party state.
Moreover, Beijing is also intensifying the pressure on foreign firms operating in China to keep records gathered from local customers inside the country, so the government has more authority over the records. (ANI)