Alarmed at the slowing tech and internet sector, China is now planning to further shift its policies to control domestic tech giants like Alibaba and Tencent, as the country battles Covid-19 lockdowns, the media reported on Tuesday.

According to a report in Nikkei Asia citing sources, Chinese President Xi Jinping “intends to shift policies regarding its control over the country’s major tech companies such as Alibaba Group and Tencent Holdings”.

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“The move is apparently aimed at revitalising the internet sector and propping up the Chinese economy, which is losing momentum amid the Russian invasion of Ukraine and the country’s zero-Covid policy,” the report noted.

Since last year, Chinese regulatory authorities have been cracking down harder on domestic tech giants to end their dominance in the internet sector.

Last month, Tencent said it will shut down its game streaming platform Penguin Esports by June due to “changes in business strategies”.

Tencent already owns the country’s two largest game streaming platforms, Douyu and Huya.

Together, the two services commanded over 70 per cent of the game streaming market in China.

The platform faces rising competition from Bilibili, which is known for its popular user-generated video streaming service, and Kuaishou, the short video app that’s the nemesis of Douyin (TikTok’s Chinese version).

Moreover, the ongoing gaming license freeze in China has intensified competition between platforms as hosts are running out of content to talk about.

In March, Covid-19 lockdowns and China’s position on the Ukraine conflict led to tech shares rout, slashing billions of dollars from the likes of Alibaba Group Holding and Tencent Holdings in Hong Kong.

Chinese stocks in the US also suffered their biggest selloff since 2008 after US regulators identified five companies that could be subject to delisting for failing to comply with auditing requirements.

The new regulation on online food delivery platforms in China also hit the industry hard, especially the Meituan food delivery app being run by Alibaba.

The Chinese authorities announced that the food delivery platforms should further reduce the service fees charged to restaurants in order to lower the operating costs for food and beverage businesses.

In December last year, Alibaba announced a major reshuffle at the top, as the country tightened its stand against domestic Big Tech companies over data and internet regulations.

Alibaba also unveiled major reorganisation plans to boost its strategy of domestic and international e-commerce.

Founded in 1999, Alibaba went through a major reshuffle when Jack Ma passed the baton as CEO to Zhang in 2015 and further appointed him as Chairman in 2019.

China’s market regulator in November fined tech giants Alibaba, Baidu, Tencent and e-commerce platform JD.com Inc and Suning for violating the country’s anti-monopoly rules in 34 mergers and acquisitions (M&A) deals in which they failed to declare illegal implementation of operating concentration.

The State Administration for Market Regulation (SAMR) has fined a raft of companies, especially in the internet platform sector, since the start of this year over their monopolistic behaviours.