China fines Didi $1.2 billion as pressure from tech sector persists

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For Didi, once hailed as an innovator and disruptor in China’s transport sector, it has been a quick fall from grace. The company was seen as the pride of China’s brave and valuable start-up scene in 2016 when it beat American rival Uber and bought the company’s Chinese operations. At the time, its executives vowed that the data collected would be used to unblock traffic jams and eventually help develop driverless cars.

As Beijing has asserted greater control over internet companies like Didi, it has sought to shape a private sector more in line with the Communist Party’s emphasis on political security and to achieve its political goals. Popular attitudes towards China’s tech sector, once a beacon of future achievement, also appear to have changed.

After the announcement of the sanction, a number of professors and technical commentators took to Weibo to demand even tougher sanctions.

Jin Canrong, a professor of international relations at Renmin University, called the revelations of Didi’s violations “really shocking! Didi “ignored national security, ignored national laws and ignored citizens’ privacy,” he added. Others went further, questioning whether a business that jeopardized national security should be allowed to exist.

In the short term, the government is likely to cave in on Didi, allowing it to restore its apps to stores. But the company will still have to show it has addressed the regulator’s concerns about data security and other issues, said Linghao Bao, an analyst at Trivium China, a China-focused policy research team.

“Big tech platforms are taking a break because the economy is not doing so well. Regulators are moving from campaign-style crackdowns to more rules-based governance,” he said. “But tech regulation is here to stay for the long haul.”

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