How China’s Tencent Avoided an Antitrust Push, For Now.

That’s glossing over the huge power imbalance between Tencent and the many satellite companies in its orbit. Colin Huang, founder of Pinduoduo, hinted at that in a 2018 interview, in which he groused that WeChat declined to help censor accusations about fake merchandise on his shopping platform.

“Tencent won’t die when Pinduoduo dies,” he said, “because it has tens of thousands of sons.”

No matter how decent or humble Tencent may act, it’s a giant conglomerate with $24 billion in profit last year and spends much of it on investment. It picks winners and losers, but the winners won’t always be the best out there, thus harming innovation and efficiency.

It limits user access to other products and services. Its WeChat app doesn’t allow users to share links for merchandise on Alibaba’s Taobao online marketplace or for short videos on Douyin, TikTok’s Chinese sister company. (Other platforms block Tencent’s services.) When three social messaging apps were launched in January 2019, they were blocked on WeChat immediately.

Douyin’s parent, ByteDance, shows the possibilities when a company goes it alone. In its early days, ByteDance’s founder, Zhang Yiming, took a small investment from Tencent to fend off the company but resisted tighter ties. In a response to rumors that Tencent would invest in ByteDance in 2016, Mr. Zhang wrote that he didn’t start ByteDance to become a Tencent employee. He posted the lyrics of the song “Go Big or Go Home.”

ByteDance’s independence paid off. It’s now valued at nearly $400 billion with a few hugely popular online content apps, including TikTok, the first Chinese internet product that became a global phenomenon.

Tencent doesn’t just court the industry. It has also long tried to get close to the government. Compared with the sometimes defiant Alibaba, Tencent has long publicly underscored its willingness to comply fully with rules and regulations.

“Now I think it’s important for us to understand even more about what the government is concerned about, what the society is concerned about, and be even more compliant,” Tencent’s president, Martin Lau, said in a January earnings call. Tencent executives used the word “compliant” six times in the call.



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