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Alibaba and Tencent: What could a future without walled gardens look like?


Two digital giants dominated the Chinese market list in Campaign's recent survey of consumer opinions, Asia’s Top 1000 Brands, conducted in partnership with Nielsen IQ. Alibaba and Tencent's expansive ecosystems cover a range of industries—the below image shows the brands that featured in our list of China's top 100 brands.


Tencent is known as an "investment powerhouse", having invested in many Chinese high-tech companies from Pinduoduo to JD, from Kuaishou to Sogou, from Meituan to iQiyi. The Chinese conglomerate is also deeply involved in the gaming industry at home and abroad.


Meanwhile, Alibaba has shares in five Chinese private courier service companies—with SF express as the only exception—as it seeks to build out its Cainiao express logistics network for its ecommerce behemoths, Tmall and Taobao. Fast-growing Chinese furniture brand Macalline used to cooperate with Tencent. Since Alibaba became its second-largest shareholder two years ago, Macalline made significant progress on both the overall Asia’s Top 1000 Brands list and the Chinese top 100, winning support and popularity from Alibaba's ecommerce platform Tmall.


Alibaba and Tencent have stakes in several of the same companies. Didi Chuxing and Bilibili are major brands that both Alibaba and Tencent have invested in. Red (Xiaohongshu or Little Red Book), valued at US$10 billion as a unicorn, is a rising-star social-media app and seed-planting ecommerce platform in China that both giants have financed.


But they are also fiercely competitive. Over the past decade, they have built their own walled gardens, preventing any interoperability for consumers and marketers. For example, Tencent prevents consumers from sharing links from Taobao or Tmall in the WeChat ecosystem. Consumers cannot use Tencent’s WeChat payment system on Alibaba platforms, and they cannot use Alipay for Meituan.


However, with Chinese regulators taking a much more active stance on monopolistic practices in the market, the two giants are reportedly considering a possible opening-up of their walled gardens.


Read more at: https://www.campaignasia.com/article/alibaba-and-tencent-what-could-a-future-without-walled-gardens-look-like/472339

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