China: edtech companies to stop using tutors based overseas

Published 17/08/2021

Top Chinese edtech companies have made announcements that they will stop selling English tutoring packages for children taught by teachers based outside of China in response to new industry regulations.

As part of sweeping reforms of the edtech industry, China has introduced new restrictions on tutoring, including on when classes can take place and the content that can be taught.

The move has been put down to trying to decrease the financial burden on parents and thereby encourage parents to have more children as the country struggles to increase its birthrate.

On August 7, VIP Kid, which has around 65,000 teachers in North America alone, said it would introduce these new measures with immediate effect.

It added that already purchased packages would continue to be honoured and existing customers would also have two days from the announcement to renew packages.

“We need to switch our online classes to be taught by instructors based in China”

On August 9, 51Talk, which primarily hires tutors in The Philippines and is reported to employ about 30,000 people, said it would not sell any packages using overseas tutors with immediate effect. According to its Twitter feed however, it is continuing to advertise for new teachers.

“Since its establishment, 51Talk has aimed to help children improve their listening and speaking skills in English, to broaden their international horizons in English, and tell China’s stories,” said the company in a statement.

“51Talk deeply understands the significance of the policy of the Party Central Committee and the State Council… and has begun active business adjustment and transformation.”

It further said that its main business when it first launched was teaching adults and that it would increase investment in courses for adults.

TikTok owners ByteDance will also wind down some of its tutoring operations and lay off staff, including one-to-one language app GoGoKid. It had established a dedicated education unit just last October.

EF has told overseas staff it expects the number of available classes for teachers to lower over the next few months as it replaces teachers with ones based in China.

“While we are still working out how to best navigate these new regulations we do know, for certain, that we need to switch our online classes to be taught by instructors based in China,” it told teachers.

“Until we have recruited these teaching resources based in China we will pause sales of our online programs.

“We know this is tough news – it is disappointing to all of us… Unfortunately these new regulations and restrictions are beyond our control.

“Please know that we have, for some time, been investigating new markets and products where we hope to be able to expand together with you.”

As companies turn to China-based teachers, it is not yet clear whether they will turn to Chinese citizens or native English speakers based in China, the latter of which are generally preferred by parents.

“I’m not really sure what I’m going to do now. I’ve used teaching online as a way to work remotely in different countries for years,” one online teacher told The PIE News.

“I’m not really sure what I’m going to do now”

“It was my only source of income. I’m sort of looking at online tutoring for other countries but for a lot of it, it’s like they want you to plan the lesson content yourself or the teaching is over Skype. And actually the pay isn’t as good.”

And while the regulations were brought in partly to reduce the financial pressure on parents, some fear this move will simply make English language education more expensive.

“After my child’s finished with all the purchased classes, I may have to pay much more to ensure the current level of native English teaching for my son, such as by finding a private teacher,” the mother of one VIPKid student told local Chinese outlet Sixth Tone.

The South China Morning Post has additionally reported that language learning apps that don’t use foreign teachers, including Duolingo and Memrise, have also been taken off of some Chinese Android app stores.

Meanwhile both TAL and New Oriental have both cancelled their quarterly earnings call with investors.

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