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a demolition and reconstruction is happening quietly.

yesterday (september 5), taotian group issued an announcement, clearly stating that it will gradually open wechat payment to all taobao tmall merchants after september 12.this indicates that the "wall-breaking" policy of major internet companies launched in september 2021 has finally reached the point of opening up the payment ecosystem, and "wechat into taobao" will be substantially implemented.

three years ago (september 9, 2021), a meeting with far-reaching impact on the internet was held under the organization of the ministry of industry and information technology. participating companies included alibaba, tencent, bytedance, baidu, huawei, xiaomi, netease, etc. the spirit of the meeting mainly involved three aspects:

for url links of the same type of products or services shared by users, the display and access formats should be consistent;

users send and receive legitimate url links in instant messaging, and after clicking on the links, they can be opened directly as web pages in the app;

no additional steps should be added to specific product or service url links, and users should not be required to manually copy the link and open it in the system browser.

since then, internet giants’ “removing walls” (interconnection) has become one of the most influential business topics in 2022-2023. however, in the actual implementation process, each company is still patching up and is always in the exploration stage of partial opening of “squeezing toothpaste”:

in november 2021, wechat allowed the opening of shopping and video links including external apps such as taobao and douyin in one-on-one chat scenarios;

in october 2022, some users discovered that a new option “transfer to wechat friends” was added to the alipay “transfer” page;

on june 18, 2023, tencent advertising and alimama realized bilateral subsidies for the first time. wechat historically supported direct access to taobao app from moments. on september 25, high-quality advertising traffic from wechat video account, moments, mini programs, etc. could be directly accessed to taobao, tmall merchant stores, product details and taobao live broadcast rooms through alimama.

in the second half of 2023, tencent and bytedance will fully resume advertising cooperation between their products.

right now, internet companies are facing a situation where the external environment is changing rapidly and the growth of traffic dividends has peaked. the rise of douyin and pinduoduo has frequently touched the nerves of tencent and alibaba. an open ecosystem is imminent for business development and commercial collaboration, and naturally will no longer be confined to the past narrative of "ecological closed loop".

even though baidu, meituan, alipay, douyin, kuaishou, xiaohongshu and other companies have "torn down walls" in their ecosystems to varying degrees, the fact that the two giants, tencent and alibaba, have pushed down the "outer wall" of payment is obviously more conducive to activating internet business innovation. in the past two years, reports of new and old giants such as bat and tmd probing into competitors' territory for business innovation have sharply decreased, and the internet business gears urgently need a new pattern and a new competitive reshuffle to drive it forward.

"tencent's 'direct line' may have bearish sentiment in the short term, but it will be more favorable to bytedance and alibaba. in the past, under zhang yiming's leadership, toutiao had a long-standing problem of 'insight into details'. once the blocking of external links on wechat is lifted, many disputes in the 'toutiao-tencent war' will be easily resolved - after all, wechat's traffic pool can still grow video accounts today, and it is a blue ocean of traffic for other mobile products." an investor told huxiu.

wechat breaks into alibaba’s “backyard”

wechat pay has fully "invaded" the taobao system, and naturally some people are happy while others are worried.

when the news of taotian group’s announcement of the addition of wechat pay spread like wildfire, some people began to discuss the situation of alipay - even though this was the official announcement of the cooperation between taotian and wechat, alipay was pushed into an awkward position.

prior to this, alipay was the largest payment service provider in the taobao transaction system. it was originally a localization experiment of paypal that jack ma envied, and initially only served taobao. later, jack ma pushed alipay to "go beyond taobao", which enabled it to grow into an independent operating platform and spawned ecological components such as yu'ebao, huabei, jiebei, mini programs, and life accounts. however, users' perception of alipay being tied to the taobao system is deeply rooted. now, with wechat pay entering the entire taobao payment ecosystem, some business formats are bound to face a reshuffle.

in response, alipay said: "openness, collaboration, innovation and sharing are the basic spirit of the internet and the general trend of industry development. alipay will uphold this spirit and continue to deepen strategic cooperation with taotian group, increase technological innovation and product innovation, and continue to create greater value for merchants and consumers. we firmly believe that openness will create a greater future."

it is undeniable that alipay is one of the few highly sticky "traffic gold mines" in the current mobile internet. according to the "2024 china mobile internet spring report" released by questmobile, typical platforms such as wechat and alipay have accumulated hundreds of millions of users; among them, the monthly active user scale of alipay mini program is nearly 650 million, with a year-on-year growth rate of 6.3%, ranking first, which is three times the growth rate of the industry market;but apart from payment, it has not yet found a clear path to commercialization.

since 2022, alipay has successively launched life accounts, launched life channels, live broadcast entrances, and even launched "10 billion subsidies" and "take a look" (click to jump to short videos and live broadcasts) for merchants, trying to fight against "pipelining" through content components - but after two years, various attempts to break out of its own limitations have not been satisfactory.

huxiu previously wrote an article pointing out that alipay will embed live broadcasts, short videos and other content into mini-programs + life accounts, focusing on three points: a. message system (including tabs); b. merchant groups; c. life accounts +, trying to recommend products to users through content reach, in order to undertake the entire chain of merchant operations.

chen xianda, general manager of alipay's digital product division, analyzed to huxiu that the reason why the platform relies heavily on the message system is that the superposition of the two phases of the funnel from exposure to click is called the overall recall rate, which has certain operational value for merchants. "messages can directly reach users, coupons, and recommendations"; therefore, the platform will focus on messaging, communication groups, and life accounts in the private domain, "focusing more on business connections."

"payment is the first mature business model, but to grow a second curve, okr cannot be based solely on payment - wechat, alipay, and douyin are just channels, and the private domain is the mother body. the business logic is to enable most companies to improve efficiency and bring changes to 'people, goods, and places'." previously, he yongming (nickname guan zhong), who is in charge of alipay's digital business division, told huxiu.

it is undeniable that the change in alipay's business intentions has attracted two groups of people: merchants and service providers (who empower merchants in stages). "when the traffic prices of various platforms rise, businesses will naturally migrate to where the cheap traffic is." the head of the beijing market of a fast-moving consumer goods brand xiang huxiu said that alipay is a new cheap traffic pool for merchants.

the problem is that although the basic base of users and merchants is there, whether the platform can support them is another matter.

from a product perspective, most commodities are not suitable for private domain business. first, targeted fans require data collection and analysis capabilities. it is impossible for alipay to quickly build a mature private domain ecosystem in the short term. tool stickiness and content stickiness correspond to completely different ecosystems. secondly, cleaning private domain fans is a technical job. especially after the individual insurance law, the ways to reach old users are limited and it is difficult to activate them.

specifically, there is not a huge gap between alipay and wechat in terms of user base, but in terms of entry stickiness, account system, user usage time and other dimensions, wechat has pulled away from alipay. the difference between the two is largely due to the different customer-oriented perspectives of the products - that is, the service goals of each component of alipay are highly consistent, and it has been extending scenario-based services around payment. even if it iterates business components in the process of merchant services, all product capabilities revolve around payment as the core, and the tool attributes are deeply rooted in the hearts of the people, making it difficult to broaden business boundaries by reshaping content scenarios; wechat is very cohesive and inclusive. it is not only an app with an ultra-high user market and ultra-high frequency, but also has a mature ecosystem with social relationship chains, a unified account system, reading habits, payment habits, and entertainment habits.

after all, wechat went from social → content → transaction → payment, and douyin went from content → transaction → payment. it is conceivable how difficult it would be for alipay to try to forge a path in the opposite direction.

it is worth mentioning that in the past two years, wechat has caught the last train of short video and live streaming e-commerce through video account, and has carried tencent's other businesses to take off many times in financial reports. video account has relied on traffic potential to run steep data curves in the short video and e-commerce tracks. now, wechat pay has officially entered the taobao ecosystem, and the trillion-dollar transaction volume of the taobao system may push the former to go further in the boundary between business and content. at least taobao can link in a larger ecosystem. its merchant ecosystem, cargo trays, skus, and organizational efficiency can enable wechat e-commerce to reduce a lot of cooperation and transaction costs, while resolving the game within the ecosystem.

of course, from the perspective of traffic, taobao is a traffic devourer. it does not generate enough traffic on its own and needs to continuously divert traffic from various places. it always has traffic anxiety. however, wechat has abundant traffic, so it naturally hopes that this traffic will be consumed with high quality (to earn money from brands and taobao buying traffic).

in addition, the e-commerce ecosystem of taobao is obviously much more mature than that of video account, whether in terms of infrastructure or after-sales fulfillment, so there are many e-commerce practitioners who believe that in the short term, this move will obviously have a faster feedback on the business growth of the entire taobao system. "in the e-commerce landscape, whether it is pinduoduo or jd.com, the user growth of both is inseparable from the powerful traffic flooding of wechat; now that the payment barrier is gone and taobao has entered the mainstream, the traffic pool that jd.com and pinduoduo rely on for survival will be diverted, at least in the circle of friends and wechat group recommendations and forwarding, it is no longer just a world of "cutting one knife".

of course, some people also think that the cooperation between wechat pay and taobao will create a win-win path. after all, when tencent and alibaba completely remove the "barriers", they will inevitably improve their respective production efficiency and create greater value for society.

in this regard, a media practitioner analyzed that "the interconnection of the three largest traffic portals in the mobile internet (tencent, alibaba, and bytedance) will form an industrial collaboration form of "entertainment attributes + social attributes + transaction attributes" - tencent will amplify resource efficiency, alibaba will improve transaction coverage, and bytedance will strengthen algorithm push."

even if a matching business resonance cannot be achieved in the short term, given the huge user base of wechat, taobao and douyin, they can at least get what they need from the business level after interconnection - tencent will further improve its e-commerce and video capabilities; alibaba will fully convert new traffic into feedback transactions and increase gmv; and douyin will further consolidate its social chain and e-commerce attributes.

ecological openness is also against "traffic monopoly"

in fact, the internet companies' will to make their ecosystems "open" or "closed-loop" changes in stages.

back to november 3, 2010, the "3q war" brought the internet companies' secret "wall-building" behavior to the surface for the first time - qq users across the country received incompatible pop-up windows from tencent qq and 360 security guard, and choosing between the two became a difficult problem facing users; afterwards, the ministry of industry and information technology mediated the "3q war", setting a precedent for urging giants to reflect on themselves.

however, in 2013, taobao and wechat blocked each other. on november 22, 2013, taobao mobile, an alibaba product, closed the channel from wechat to taobao products and stores on the grounds of security vulnerabilities, and tencent also retaliated by blocking wechat public accounts and mini-programs.since then, the two largest traffic entrances to china's internet have been "walled high".

later, alibaba and tencent also included companies with close capital ties. taobao, hema, and ele.me from the alibaba group hid or cancelled wechat pay; tencent video, jd.com, meituan, etc. from the tencent group also cancelled or hid the alipay option.

even the game between alibaba and tencent once covered most of the internet, causing the major platforms to have "differentiated closeness" and "each taking sides" for a period of time. everyone drew a line in the sand and built their own city. selectively blocking external links almost became an industry consensus, and the "ecological island effect" gradually emerged - the users, data, and infrastructure of the major platforms were separated, and the innovation mechanism was also suppressed to a certain extent.

it is worth mentioning that the period from 2013 to 2018 was a window of explosive growth for mobile internet products and a golden period for the mobile wave to grab land. both alibaba and tencent naturally hoped to "keep" as much traffic as possible and complete the business closed loop in their respective ecosystems.

previously, the "research on the anti-monopoly process and characteristics of china's it industry in the past 20 years" written by the internet laboratory pointed out that "ali and tencent have gained absolute discourse power by establishing an ecosystem and formulating rules, and have obvious control and influence over public opinion. they have also formed factional power based on their own powerful service ecosystem and capital advantages."

based on tencent’s investment performance report released in early 2020, more than 70 of the 800 invested companies were successfully listed, of which 15 generated returns of more than us$1 billion, 6 generated returns of more than us$5 billion, and even one generated returns of more than us$10 billion.

image source: china economic weekly

how powerful is this faction? new fortune previously summarized it in a related article:

"through investments and mergers of 500 billion to 600 billion yuan in recent years, tencent and alibaba have built ecosystems with a market value of 10 trillion yuan each, which has expanded 10 times in 5 years. in comparison, the total market value of listed companies controlled by the shanghai local government is 2.8 trillion yuan; the total market value of more than 300 listed companies in shenzhen is 11 trillion yuan;the capital power of tencent and alibaba is even comparable to that of a first-tier city.”

this is not an exaggeration. ten years ago, entrepreneurs could still lead their companies to go public and develop independently. now, the wills of the giants behind most star companies are intertwined. as cheng wei, the founder of didi, said in an interview with caijing in 2017: "if you can't do it vertically, you can only do it horizontally. this is a chinese characteristic."

it was not until the emergence of zhang yiming that the balance of the game between alibaba and tencent was broken. bytedance rushed headfirst into the hunting ground of alibaba and tencent, and conquered cities and territories with a lightning-fast combat style of "great force works miracles", extending its reach to various fields such as medical care, education, enterprise services, social networking, consumption, and real estate. even though it encountered heavy firepower from other giants, it still inadvertently rewrote the information, short video, and e-commerce landscape, giving birth to a super-leading business group.

as a result, the "tencent-bytedance war" once again brought the dispute over mobile product blocking of external links to the forefront. on may 7, 2018, zhang yiming celebrated tiktok's first place in free downloads on the app store in q1 in his moments, writing: "celebrate small success." later, zhang yiming wrote in the comments section: "wechat's excuses for banning and weishi's plagiarism and copying cannot stop tiktok's pace." ma huateng directly responded with: "it can be understood as defamation."

in fact, zhang yiming’s accusation back then was not without reason.

originally, the leading products in the mobile internet segments all had a market selection process, but tencent, alibaba, and later bytedance, relied on their investment layout to a certain extent to turn market selection into "giant betting" - intervening in the traffic cycle of other products based on their own business strategies, and pouring more resources into the "direct line", so that the invested platforms have excess funds to burn money to grab the market and give rise to disorderly expansion, which in turn makes the products in each segment track become more "utilitarian" in the process of standing in line.

the most magical thing is that the mobile internet has achieved a certain degree of "monopoly" with an open attitude.mobile internet pioneers have amplified the efficiency of information flow and resource sharing through business innovation, which has also led to resource aggregation and winner-takes-all results.

in essence, this is to turn public traffic into the platform's own "bargaining chips", and in the process of the game, it has evolved into a means of building walls and blocking external links. this fundamentally violates the original intention of the mobile internet to advocate the free flow of information and ecological interconnection.therefore, no matter how internet companies have whitewashed their sophisticated business calculations in the past, blocking external links is a commercial means of restricting user freedom of choice and damaging user rights.

nowadays, with the interconnection and open ecology of major platforms, users will personally feel the convenience brought by the smooth flow of all products - whether it is food, clothing, housing, transportation, eating, drinking and having fun, they no longer have to copy a bunch of strange letters and symbols to another product, or jump back and forth between different apps during the payment stage.

in other words, the “tearing down of walls” between mobile internet products seems to be solving the problem of ecological openness, but in fact it is solving the freedom of choice between different camps that is damaged by “traffic monopoly”.only by fully eliminating the divisions between giants can interconnection and interoperability no longer be an empty talk and can more room for innovation be stimulated in the increasingly "static" internet ecosystem.