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The two largest Chinese companies promised to launch their digital controls on Monday, an idea that could change online life for hundreds of users.
For the past eight years, Tencent and Alibaba have photographed the Chinese internet in two rival camps, comparing each other and blocking interactions between their platforms.
Tencent payment methods cannot be used on Alibaba’s website and vice versa. Alibaba store links cannot be installed on WeChat’s Tencent app. Short videos from ByteDance, owner of TikTok and the app of his Chinese sister Douyin, also cannot be posted on WeChat.
But after being invited to a meeting by the Ministry of Industry and Technology (MIIT) last week, both companies said Monday they would allow their competitors to enter the “fenced-in fields”. The conference was also hosted by ByteDance, Baidu, NetEase, Huawei and Xiaomi.
“We agree with the Ministry of Industry and Information Technology and [will] set you up slowly, ”Tencent said.
Alibaba said it was “fully compliant” with the ministry’s call to end the practice among major online giants that barred consumers from connecting to other web services.
Under pressure from regulators, Chinese companies Big Tech have already started work harder this year, and researchers said they could improve their efforts to be more obedient.
“The companies are not complying with the new rules. The next project is fast-paced, “says Li Chengdong, the founder of Dolphin, a Beijing-based technology think tank.” The platforms are very careful in terms of weather conditions.
Changes to the platform are set to begin in the coming weeks, researchers said. In Hong Kong, Tencent shares fell 2.45%, while Alibaba shares fell above 4%. Alibaba shares can also be affected by a Financial Times Report that Beijing wants to deal with Alipay, a paid superapp owned by its sister company Ant.
Investigators said the forced opening was highly anticipated and had purchased company prices since the beginning of this year.
Ke Yan, a DZT Research researcher who writes on the Smartkarma platform, said the forced opening would hurt Tencent a lot, because his WeCh messaging program
at was the most powerful driver of internet traffic.
But Li Dolphin doubted whether it would change the client. “If I want to shop online, I have to go to Taobao or Pinduoduo. “Because I can get Taobao from WeChat, it doesn’t make me use Taobao,” he said.
Wong Kok Hoi, chief financial officer at APS Asset Management, said the move could force technology companies to reconsider their multi-pronged approach to creating a closed environment.
“You won’t be able to make a profit on your own, and more competition means less profit and less business,” Wong said.
Angela Zhang, an assistant professor of law at the University of Hong Kong, said MIIT, which made the change less effective in enforcing anti-apartheid laws and competition.
But Zhang said MIIT’s intervention could lead to action by the State Administration for Market Regulation, explaining why technology companies have been quick to show compliance.