China’s Tencent suspends registrations for WeChat, its popular app.
The company attributed the suspensions to a technical update of security features, but fears of new regulatory pressure sent its shares sharply down.
The Tencent booth at an internet conference in Beijing earlier this month. Tencent’s WeChat service dominates Chinese social media.Credit…Tingshu Wang/Reuters
The Chinese internet giant Tencent said Tuesday that it had temporarily suspended new user registrations for its hugely popular WeChat app, raising fears of new regulatory pressures even as it insisted the outage was the result of a technical upgrade.
Tencent said in a statement that the shutdown, which affected only new users and groups registering for the app, would be over by early August and was part of a fix to its security technology.
The timing of the suspension left investors uneasy, with concerns mounting that a regulatory rampage aimed at the technology sector could heavily affect Tencent, China’s largest internet company. By far the company’s most important product, WeChat dominates Chinese social media, allowing users to do everything from share photos and chat to pay for coffee and pay bills.
Tencent’s shares closed down almost 9 percent in trading in Hong Kong. Overall, it was a rough day in Chinese stock markets, with the Hang Seng Index in Hong Kong dropping 4.2 percent and the Shanghai Composite down 2.5 percent, amid concerns over Beijing’s regulatory crackdown.
Thus far, Tencent has managed to steer clear of the worst of a nine-month spree of government scrutiny on China’s high-flying tech sector that has led to multibillion-dollar fines, suspensions of app services and tumbling share prices for its rivals and as well as companies it has invested in. Over the past month alone, Chinese officials have mandated security reviews for internet firms seeking to list their shares abroad and barred tutoring companies, many of which operate online, from making a profit.
Tencent’s worst scrape with Beijing has come through a company it has invested in, the ride-sharing business Didi. Earlier this month, regulators opened an investigation into the company, eventually ordering its apps off mobile stores until the investigation concluded. The company’s shares are now down more than 40 percent from when they listed at the end of last month.
In its statement Tuesday, Tencent sought to play down the suspension, but acknowledged the hand of the government, saying that the security upgrade was “to align with all relevant laws and regulations.”
On Saturday, China’s market regulator separately took action against Tencent, invoking the country’s antimonopoly law. It issued the company a small fine, roughly $75,000, but also forced it to abandon exclusive deals it had with record companies for its music business, arguing that an acquisition had given it excessive market share in the sector. Shares in Tencent Music, which trades in the United States, fell 3 percent on Monday and were down another 4 percent in premarket trading Tuesday.
A trailblazer in chat apps, gaming and social media, Tencent’s soft-spoken founder, Pony Ma, has a track record of keeping the company out of the spotlight and away from government scrutiny.
Yet the company itself is renowned in Chinese tech circles for its aggressive competitive strategies, using its huge social media platforms first built more than a decade ago to overwhelm nascent rivals. Recently, it has taken stakes in a constellation of internet newcomers and then linked its services to them in an effort to compete with Alibaba, a rival e-commerce giant. It’s not clear whether the paltry fine over its music holdings and the quiet security rework are indications it will get off light or the worst is yet to come.
Alibaba shows how bad things could get. In April, Chinese officials fined the company $2.8 billion for monopolistic behavior. Last year, regulators suspended the blockbuster listing of Alibaba’s sister company, Ant Group, days before its initial public offering, likely cutting more than $100 billion from its market share.
A Mirai at a hydrogen fuel pump in Torrance, Calif. The lack of refueling infrastructure, along with the cars’ high prices, has held them back.Credit…Philip Cheung for The New York Times
Even as other automakers embraced electric cars, Toyota bet its future on the development of hydrogen fuel cells — a costlier technology that has fallen far behind electric batteries — with greater use of hybrids in the near term. That means a rapid shift from gasoline to electric on the roads could be devastating for the company’s market share and bottom line.
In recent months, Toyota has quietly become the auto industry’s strongest voice opposing an all-out transition to electric vehicles — which proponents say is critical to fighting climate change, Hiroko Tabuchi reports in The New York Times.
Last month, Chris Reynolds, a senior executive who oversees government affairs for the company, traveled to Washington for private meetings with congressional staff members and outlined Toyota’s opposition to an aggressive transition to all-electric cars. He argued that gas-electric hybrids like the Prius and hydrogen-powered cars should play a bigger role, according to four people familiar with the talks.
The recent push in Washington follows Toyota’s worldwide efforts — in markets including the United States, Britain, the European Union and Australia — to oppose stricter car emissions standards or fight electric vehicle mandates.
Households including 60 million children received advanced child tax credit payments in July to help them emerge from the pandemic.Credit…Christopher Smith for The New York Times
The Biden administration sent out letters to families alerting them about payments this month that are part of an expanded child tax credit that aims to support Americans as they ride out the pandemic. Instead of claiming the benefit during tax season, eligible families are receiving half of the credit, up to $300 for each child, in monthly installments that began in July and will run through December.
The payments are welcome relief for many households — families including 60 million children received $15 billion in July — but there is a fair bit of confusion about what they may mean when it comes time to file tax returns next year. Tara Siegel Bernard reports for The New York Times on some of the top reasons taxpayers may want to take a closer look at the potential tax implications or consider opting out of the advance payments.
“Accepting the credit now can be a lifeline for many, but it’s important that taxpayers know how this will affect them during next year’s tax filing season,” said Cari Weston, an accountant and director for tax practice and ethics at the American Institute for Certified Public Accountants, a trade group.