Yahoo becomes latest US tech company to leave China

The US company Yahoo Inc. concludes its exit process from China this November. The company, which had been operating in the country for 20 years, began this process in 2013, after which its range of services had been progressively reduced. Functions such as email and news were no longer available, which is why the technology company's exit on 1 November was essentially 'symbolic', as The Wall Street Journal pointed out. 

This exit was preceded by the closure of other US technology companies, such as Microsoft, which withdrew its LinkedIn platform from China last October. Likewise, Google's search engines have not been available in the country for years, making Baidu - the Chinese search engine - the most widely used browser in China, and the social network Facebook is subject to multiple blockades.  

In this context, the video game company Epic Games has also announced the withdrawal from the market of the game 'Fortnite' from 15 November. The version that will be withdrawn is a special version that meets the Chinese government's requirements on violent or politically sensitive content.

For its part, while the Yahoo company has justified, through one of its spokespersons, that its withdrawal is due to the fact that the Chinese commercial and legal environment is "increasingly challenging", Epic Games has not explained the reason for this decision. However, its exit from the country adds to the stampede of US tech companies out of the Asian country, deepening its isolation. 

This is in addition to the measures taken by the Chinese government in August 2021 that limit the time that children under the age of 18 can spend playing video games. Thus, despite the fact that this sector generates enormous profits for the country, the Chinese authorities justify the imposition of restrictions as a way of combating addictions and the negative effects produced by new technologies. 

However, the Chinese Communist Party's (CCP) efforts to control the technology sector can be understood as part of the commercial and economic battle between the Asian power and the United States. Thus, China is trying to reinforce its position as a technology producer and to protect and control its own domestic market.

Some of the laws enacted in recent months that have been an obstacle for foreign technology companies are the Personal Data Protection Act, the Data Security Act and the Personal Information Protection Act. In fact, the entry into force of the latter has been one of the factors behind the flight of technology companies. The purpose of this law is to guarantee the protection of Chinese users' data when it is transferred outside the country, as well as to allow the Chinese government to carry out periodic audits of this data.

All this is taking place against the backdrop of the trade and economic war that the US and China have been waging for several months. The exit of Yahoo, LinkedIn or 'Fortnite' is presented as a warning of the obstacles that Western companies -mainly American- face in this scenario of competition. Thus, both powers are distancing themselves from each other in various sectors such as business, trade and technology, which is leading to the emergence of new international balances in markets and diplomatic relations.