Skip to content

The Real Reason China Is Cracking Down on Its Tech Giants

Primary school students on the first day of a new semester on Feb. 21, in Lianyungang, China.

Primary school students on the first day of a new semester on Feb. 21, in Lianyungang, China.

Photographer: VCG

When China went into Covid-19 lockdown last year, online tutoring took off. Billions of dollars flooded into hot startups, among them Yuanfudao, which offers an ingenious math problem-solving app that Chinese parents use to check their kids’ homework.

Yuanfudao claims it looks over almost 100 million answers to math questions every day, saving countless hours of parental time, while its algorithms identify common student errors that help refine the company’s online classes. This week, Yuanfudao became one of the most prominent targets of a regulatory crackdown that has all but wiped out China’s $100 billion-a-year private tutoring industry.