Alibaba opens up its ‘walled garden’ to Tencent’s WeChat Pay, heeding Beijing’s order

WeChat Pay is now available as a payment option on some Alibaba services such as food delivery platform Ele.me and video-streaming site Youku
The long-running industry practice of blocking links to rival services has come under intense government scrutiny as Beijing tightens control on Big Tech

Alibaba

Jane Zhang

Published: 5:00pm, 28 Sep 2021

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Alibaba Group Holding has started to allow consumers to use WeChat Pay, the payment service operated by its rival Tencent Holdings, on a number of its platforms amid the Chinese government’s major push to encourage competition and curb monopolistic behaviour among Big Tech.

A number of Alibaba services – including food delivery platform Ele.me, video-streaming platform Youku, online ticketing platform Damai and cross-border e-commerce platform Kaola – now include WeChat Pay as one of their payment options.

Meanwhile, Alibaba’s bargain marketplace Taobao Deals, second-hand e-commerce platform Idle Fish, as well as grocery chain Freshippo are awaiting approval from Tencent to include WeChat Pay on their services, Alibaba said on Tuesday.

The end of Big Tech ‘walled gardens’ in China will reshape competition

Taobao, Alibaba’s largest online marketplace, has included Cloud QuickPass – a payment service operated by the state-owned UnionPay – as a payment method since August, the Hangzhou-based e-commerce giant confirmed.

“We believe connectivity and openness are the foundation of a healthy digital ecosystem,” an Alibaba spokeswoman said. “We will continue to find common ground with our peers in the platform economy to better serve Chinese consumers.”

Alibaba is the owner of the South China Morning Post.

The move came days after WeChat began to allow links to its rivals to be shared in one-to-one chats in response to Beijing’s urging. For external links in big chat groups, WeChat will develop more functions so that users can make their own choices, according to a statement published on the company’s official WeChat account earlier this month.

Chinese tech giants have been rushing to tear down their “walled gardens” after years of building barriers around their ecosystems and blocking links to rival services. In the past, Alibaba had excluded WeChat Pay – a major rival to Alibaba’s affiliated platform Alipay – from its bevy of marketplaces and apps. Tencent’s WeChat had banned some external links to competitors, including Alibaba and ByteDance, the operator of short video apps Douyin and TikTok.

Big Tech’s ‘walled gardens’ start to crack as Tencent vows to obey Beijing

The industry practice of blocking and restricting access to the websites of competitors has come under intense scrutiny in a six-month internet clean-up campaign started by the Ministry of Industry and Information Technology (MIIT) in July. The crackdown targets industry problems including disturbances of market order, infringements on user rights, threats to data security and unauthorised internet connections.

“Blocking website links is one of the priority issues of our campaign, and ensuring normal access to legitimate websites is a basic requirement for the development of the internet,” Zhao Zhiguo, MIIT spokesman and director general of the ministry’s Information and Communications Management Bureau, said at a press conference two weeks ago, adding that the ministry has received numerous complaints on the issue.

After the MIIT ordered “self rectification” measures to unblock external links, Tencent said it supports the decision and would “make the necessary changes in phases”. Alibaba said it would “fully comply” with the new mandate, and ByteDance said it would not delay implementation.

This article appeared in the South China Morning Post print edition as: Alibaba opens up services to top rival

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