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Sea Group shuts down Shopee operations in India

Sea Group shuts down Shopee operations in India

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Sea Group has withdrawn its eCommerce operation, Shopee, in India, months after its launch in the market last October. According to the notice of closure on Shopee India's website, operations will cease with effect from 29 March but the platform will continue to handle orders placed before then and support local merchants during the transition. 

Sea's move comes after India banned its popular gaming app Free Fire, multiple sources such as Channel NewsAsia and Reuters reported. In a statement from Shopee to MARKETING-INTERACTIVE, a spokesperson clarified that the move was not related to regulatory matters.

“In view of global market uncertainties, we have decided to close our early-stage Shopee India initiative," he said. He added that during this period of transition, Shopee will focus on supporting its local seller and buyer communities and its local team to make the process as smooth as possible. 

“We will continue to focus our efforts on delivering a positive impact to our global communities, in line with our mission to better the lives of the underserved through technology,” he said.

Free Fire's ban in India came as part of the country's clampdown on apps that are of Chinese origins, citing security concerns, The Straits Times (ST) reported. Meanwhile, Reuters said India believes that user data was being sent via the apps to servers in China. This would allow the data to be "mined, collated, analysed and profiled", potentially by "elements hostile to" India's integrity and sovereignty. Reuters added that the data can be used for "activities detrimental to national security". 

Free Fire was one of the 54 mobile apps that India blocked access to this year. Following the ban, Sea's market value dropped by US$16 billion (SG$21.7 billion). According to media reports, Singapore has since raised concerns with India over the game's ban, as Sea, which owns the brand, was founded in Singapore in 2009 by Chinese-born founders who later became Singaporean citizens. 

This marked the latest instance of tensions between India and China, beginning in 2020 following a border clash. India previously banned 59 Chinese apps, including TikTok, and eventually expanded the list to comprise 321 apps.

At the same time, this is also Sea's second pullback from a foreign country in a month as Shopee pulled out from France earlier this month after its foray into Europe. The site ceased operations on 6 March. In a statement to Bloomberg, Shopee said that following a short-term, preliminary pilot, the company has decided not to continue the Shopee service in France. It added that other markets are unaffected, and Shopee will continue to adopt an “open-minded and disciplined approach to exploring new markets". 

Separately, Garena appointed South Korean boy band BTS as Free Fire’s global brand ambassador. The collaboration will kick off with a Free Fire event this month, with a series of collaboration events and activities both in the game and beyond. 

The virtual and real-life activities under the global collaboration campaign, Gen FF, include The Free Fire x BTS Show which is an exclusive two-episode variety show where all seven members of BTS engage in a series of activities and discussions. There will also be BTS banners and artwork hidden in surprise locations as players traverse the maps in the game.

Harold Teo, Free Fire producer at Garena, said previously that bringing BTS into the Free Fire universe will offer its players more ways to engage with the game, socialise with the community, and enjoy new experiences. "BTS is a global phenomenon; their appeal and influence are unrivalled. We are absolutely excited to welcome BTS as our latest brand ambassador, and can not wait to share the collaboration plans we have in place,” he added. 

Photo courtesy: 123RF

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