Yahoo Pulls out of China Over ‘Challenging’ Business Conditions

Yahoo has become the latest US tech company to end its presence in mainland China as tougher regulations are imposed there.

The firm said its decision was due to an “increasingly challenging business and legal environment” in the country”.

Yahoo users in China are now greeted with a message saying its sites are no longer accessible.

The company says Yahoo products and services remain unaffected elsewhere around the world.

In a statement, it says: “Yahoo remains committed to the rights of our users and a free and open internet. We thank our users for their support.”

Yahoo’s move follows closely behind Microsoft’s announcement last month that it was removing LinkedIn – its business-focused social network – from China, something it also blamed on “a significantly more challenging operating environment and greater compliance requirements”.

China is in the midst of a large-scale crackdown on big tech companies – both those from the US and its own native giants.

A range of laws passed in recent years contributes to what Yahoo and others characterise as a “challenging” market.

The Personal Information Protection Law – or PIPL – which came into effect on 1 November, is one of them.

Designed as a Chinese data-protection law, it introduces a range of regulations about how data can be collected and stored, with the threat of potentially massive fines of up to 5% of a company’s annual turnover.

Foreign entities processing user information – such as through web cookies and services – must have a presence, or appoint a representative on the Chinese mainland, responsible for enforcement.

In some ways, it is not dissimilar from privacy-focused laws, such as GDPR in Europe. But the political environment is significantly different in China from that in many western nations, with strict censorship requirements.

Some Western tech firms have been criticised for having links to China, or for storing user data there.

 

Even Chinese firms are suffering the effects of a broader tech crackdown, part of a five-year plan from the state to regulate its economy.

Bitcoin mining has been devastated by a blanket ban on the trading of crypto-currencies, while Alibaba was handed a record $2.8bn (£2bn) fine earlier this year.

And the crackdown extends to gaming, too – which officials have likened to digital drugs – while introducing rules that severely limit children’s use of online games.

Once a rival to Google as the search engine of choice in the early days of the internet, Yahoo has seen its fortunes dip over the past two decades.

Today, it still provides web portal services – a landing page with a range of news, alongside email and search functions. But it has been eclipsed by Google and newer giants, such as Facebook and Twitter.

It also owns a number of media brands, such as technology news sites Engadget and TechCrunch, which are also no longer accessible in China.

It has changed hands several times, most recently in May, when US telecoms firm Verizon sold it and AOL to a private-equity firm for $5bn.

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