What Happens When Beijing Gets Annoyed by Chinese Tech Firms

Problems faced by a leading tech unicorn are a reminder that political risk is at least as big a factor in China as it is in the U.S.

When Mark Zuckerberg was asked in a Senate hearing last week whether he could have created Facebook in China, he replied that “there are some very strong Chinese internet companies.” Indeed there are, but there are also some crucial differences.

While Facebook’s shares have taken a hit as investors mull the possibility of increased regulation of the U.S. tech sector, things can move much faster in China. Last week Beijing shut down the app Neihan Duanzi, produced by Beijing Bytedance Technology, because it contains “vulgar”...