The US streaming behemoth Hulu is reportedly laying off around 200 individuals, or 90% of the personnel, at its research and development (R&D) center in Beijing, China.
Hulu's Beijing R&D center was established in 2007, a full year before the business began offering its streaming service in the US.
According to South China Morning Post (SCMP), technology for playing back videos online, as well as advertising and content recommendation algorithms, are the main areas of concentration for the staff in Beijing. The 21st Century Business Herald was the first to announce the reduction in staff, which had previously made the facility the company's second-largest R&D hub after the US headquarters.
Mass Tech Layoffs
Hulu's reorganization follows a trend of similar moves by other large US technology companies, such as Microsoft and Facebook owner Meta Platforms, to decrease expenses in light of the current economic climate.
Early this month, Meta revealed that they will be eliminating over 10,000 positions before the end of the year. CEO Mark Zuckerberg cautioned workers to be ready if this new economic reality remains for many years.
Microsoft and Google, two of the largest technology companies in the US, have just stated that they would lay off more than 10,000 employees apiece as they prepare for slower revenue growth.
Concern Over US Firms Leaving China
Since China's domestic Big Tech firms have already cut thousands of jobs in response to regulatory crackdowns, competitive pressures, and the negative economic impact of last year's stringent Covid-19 restrictions, Hulu's downsizing in Beijing is further evidence that the current wave of US tech layoffs has managed to reach China's shores.
Hulu's reorganization has sparked fears that more American corporations may pull out of China, displacing local workers, when relations between Beijing and Washington have deteriorated and antagonism is high. Hulu is majority-owned by The Walt Disney Co.
The online lodgings reservation business Airbnb was one of the first American technology companies to leave China. It left the country a year ago due to the country's stringent regulations on the Covid outbreak, as well as the intense rivalry from local players.
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Disney Layoffs
Disney, Hulu's parent company, has revealed a restructuring plan to eliminate over 7,000 globally, beginning this week, including several positions in Beijing.
Although the American theme park giant's streaming business expanded rapidly during the epidemic, it had to make cuts when the golden period ended. Inflation drove the firm to concentrate on profitability.
"We have made the difficult decision to reduce our overall workforce by approximately 7,000 jobs as part of a strategic realignment of the company, including important cost-saving measures necessary for creating a more effective, coordinated, and streamlined approach to our business," Disney CEO Bob Iger wrote in a memo, via a PingWest report.
The CEO initially announced the layoff plan in February, stating that Disney+, Hulu, and ESPN+'s streaming business would cease losing money in 2024.
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