China Seizes Control Of Algorithms As It Further Tightens Grip On Tech Companies

In a move it claims will promote the sustainable development of algorithm services and strengthen supervision, Chinese regulators unveiled a new set of regulations targeting algorithm recommendations used by tech firms. The new rules comes in to effect on March 1.

The regulation is seen as crippling blow to Chinese tech titans including Alibaba, Tencent and ByteDance as the use of algorithms to determine what users read, watch and purchase online is a key cornerstone of their business model.

The regulations released by China's Cyberspace Administration of China (CAC) on Tuesday specifies that service providers should not use algorithms "to influence network public opinion to circumvent supervision and management, or act in a monopolistic way and engage in unfair competition."

The new regulations also forbids “unreasonable discrimination" in pricing and other transaction terms based on user habit data, a key monetization mechanism for some of China’s largest e-commerce and short-video platforms.

The new regulation, according to a statement from the CAC , also seeks to address “algorithmic discrimination”, which has led to differentiated pricing of products and services. Certain internet platforms have been charging consumers extra fees based on data about these users’ spending habits.

The consumers will have the right to switch off algorithmic recommendations on apps and see or delete the keywords the algorithms use to target them.