Alternative hypothesis: This is just another round in the infighting between China's party, government, and big business, one that the party and government intends to win.
China's big, customer-facing "tech industry" (I agree with that part of the argument) lives in the same environment as that of the rest of the world, with the same ability to generate the same large profits. Those large profits provide a power base that threatens the party, which in turn uses its governmental power to smack down anything threatening.
China's big, customer-facing "tech industry" (I agree with that part of the argument) lives in the same environment as that of the rest of the world, with the same ability to generate the same large profits. Those large profits provide a power base that threatens the party, which in turn uses its governmental power to smack down anything threatening.