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Chinese regulators have ordered ByteDance Ltd. to temporarily suspend downloads of its nascent Slack-style office app after discovering content from banned sites like Facebook and Twitter, hitting the startup’s broader internet ambitions.
The China Cyberspace Administration informed the TikTok operator that it must withdraw its Feishu office collaboration tool from the main national app stores for about a month, people familiar with the matter said. That was a punishment for a feature that allowed users to browse foreign platform posts through a newsfeed feature, the people said, asking not to be named because the decision has not been made public. It is unclear when the actual takedown will occur, they added.
The decision hits ByteDance’s ambitions while projecting an unwanted focus on Feishu, which became popular during the pandemic as a work-from-home alternative. Feishu intended to help lead a foray into the business software market, which has skyrocketed since Covid-19 drove millions of workers out of offices. According to IDC data, the global market for collaborative applications grew from $ 14.8 billion in 2018 to $ 16.5 billion last year. Even with strong headlines like Microsoft Corp. and Slack Technologies Inc., it has room to grow, and ByteDance has the added incentive of increased demand in its local market.
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Feishu, a combination of Slack, Skype and Google Docs, competes in China against similar offers from Alibaba Group Holding Ltd. and Tencent Holdings Ltd. Alibaba’s DingTalk was the most downloaded free app in China’s iOS app store for weeks during The national closure. Feishu’s twin app for users outside of China, called Lark, works normally and targets markets like Japan and Singapore.
ByteDance declined to comment, and the CAC did not immediately respond to requests for comment sent by fax and message.
Staying on the good side of censors is key to the long-term success of Chinese internet companies like ByteDance, the world’s largest startup. Beijing rigidly rules its online sphere, seeking to remove content it considers a threat to social stability. In 2018, ByteDance had to shut down the popular prank app Neihan Duanzi after regulators complained about vulgar and inappropriate content. In a similar vein this month, regulators ordered Baidu Inc. to suspend various news channels on its flagship search app.
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ByteDance removed the Feishu newsfeed feature in question last month after regulators raised concerns about the sensitive content it allowed, the people said. That feature, they say, was included as part of Feishu’s workstation platform, which helps companies manage everything from paychecks to travel and leaving approvals. But the action could not prevent regulatory repression, they said.
This week, the startup released a reduced version of Feishu without Workstation, hoping to continue capturing new downloads in the absence of its main app. Feishu Lite still offers key features from group chats and online document management to video conferencing.
The regulatory error could disrupt the expansion of ByteDance’s fledgling business wing, which has a team of more than 1,700 people and will add more as part of a wave of global hiring. The unit is preparing to launch a suite of Google-like office tools out of Feishu, Bloomberg News reported in March.
