Daily Management Review

Chinese Clampdown Forces ByteDance To Close Some Tutoring Operations – Reports


Following the imposition of strict and sweeping regulations on the online education sector by Chinese regulators, TikTok owner ByteDance is planning to cut down some jobs and close down some of the tutoring business, said reports quoting sources with knowledge of the matter.   
Rules that ban profit making by companies offering curriculum-based tutoring services were imposed in China last month with the aim of bringing down some of the financial pressures on parents or for couples planning to have children which have contributed to the low birth rates. The new regulations have put intense pressure on private education companies for their business prospects.  
Some of the teachers, sales and advertising staff in the education unit will be axed by ByteDance while also shutting down its curriculum-focused preschool and K12 tutoring businesses in China so that it is able to meet the requirements for the new regulations, said reports quoting sources.  
Closing down of its one-on-one English online classes app Gogokid is also a part of the plans of the company, claimed reports. Apple's App Store in China did not have the app for downloading on Thursday.  
There were no comments on the issue available from ByteDance.
The owner of hit products including the short video apps TikTok and Douyin as well as news aggregator Toutiao, ByteDance was hoping that online education will be its next successful venture as the company had prioritized focusing on the sector since the past year.
Last October, its education unit Dali, which translates to "forceful strength" in Chinese, was established by the company while it also operates a number of tutoring apps targeting preschool kids and K12 students. The education business unit of the company has more than 10,000 employees. The other products of the company in this sector include school courses tutoring app Qingbei.
Reports however did not specify the number of layoffs even though the reports suggested that the company has been transferring some employees from its education business to other parts of the company.
There have been warnings about the new regulations having a significant material impact on their after-school tutoring services issued by other companies operating in this segment including TAL Education Group- publicly listed in the United States, New Oriental Education & Technology Group and Gaotu Techedu.