China tech crackdown: Tencent’s app update suspension seen as a shot across the bows of other app developers
- Analysts say authorities want to send a message to app developers that they must comply with new laws and regulations on user data
- Ministry of Industry and Information Technology has been engaged in a broad campaign to ensure compliance with China’s new data laws
China’s move to suspend internet giant Tencent Holdings from upgrading apps or launching new ones is a warning to all tech firms in the country that Beijing means business when it comes to rectifying data collection practices, according to analysts.
They said the new app freeze imposed on Tencent, which operates the country’s super-app WeChat and is the world’s biggest gaming company by revenue, is a message from the Ministry of Industry and Information Technology (MIIT) to app developers that they must comply with new laws and regulations governing the handling of user data.
“MIIT is trying to kill the chicken to scare the monkeys,” said Linghao Bao, an analyst with Beijing-based consultancy Trivium China. “This is not just a Tencent issue but a wider issue for internet companies – although MIIT has gone after these illicit practices regularly, many companies have just shrugged off the warnings.”
Bao said that the administrative move imposed on Tencent, which runs dozens of apps in China, sets an example and sends a signal that implementation of new regulations will be ruthless.
The ministry has suspended Tencent from updating its existing apps or launching any new apps as part of a “temporary administrative guidance”, according to Chinese state media reports, including state broadcaster CCTV. Tencent indirectly confirmed the report on Wednesday by saying it has “regular cooperation with relevant government agencies to ensure regulatory compliance” while its apps remain available for download.
According to a separate report by China Business News, a Chinese newspaper, the administrative measure against Tencent is just part of MIIT’s broad campaign to ensure apps meet the requirements of the Personal Information Protection Law, which came into effect this month.
The newspaper cited unidentified sources as saying that the ministry has required all new apps and updates from November 24 to the end of the year, to go through a review process by the authority. A regulatory review of an app usually takes seven days.