Why Antitrust?

 　　Wherever the world is torn apart, there will be a frenzy of growth.

　　In April 2021, Alibaba was fined 4% (about 18.2 billion yuan) of sales revenue in China in 2019 for its "choose one" monopoly. In October 2021, Meituan was also fined 3% (about 3.4 billion yuan) of sales revenue in China in 2020 because of the "choose one out of two". In September 2021, Tencent's WeChat will be able to open the Taobao link. Later, some of Alibaba's apps also began to support WeChat payment.

　　Behind these events is one word - antitrust. Although China's Internet giants have not really experienced anti-monopoly, the experience of the United States tells us that after anti-monopoly, the business world will usher in a frenzied growth of small companies.

　　Theodore Roosevelt was the 26th President of the United States, and he is one of only 4 presidents carved in stone on the "Presidents Hill" of the United States. Roosevelt is most famous for his iron fist in antitrust.

　　At the beginning of the 20th century, there were a lot of mergers and acquisitions in the American business world. Among them, 1,800 companies merged into 157. In 1900 alone, there were 185 mergers. As a result, by 1904, more than 300 monopoly alliances controlled two-fifths of the manufacturing capital of the United States, and these monopoly enterprises also accumulated a lot of wealth.

　　In the United States at that time, 1/8 of the families occupied 7/8 of the wealth. In order to maintain their monopoly position, they took various measures to crowd out small and medium-sized enterprises and suppress market competition, which seriously affected the vitality of the American economy.

　　In 1901, Roosevelt came to power, and he perfected the Sherman Act, the first antitrust law in the United States and the first in the world. Then, under the law, the U.S. government sued Northern Securities, the Morgan family-controlled monopoly on railroad operations. In 1904, the Northern Securities Company was dissolved. In 1906, the U.S. government sued Standard Oil, which was controlled by the Rockefeller family and monopolized the oil industry. In 1911, Standard Oil was split into 34 regional oil companies, including the Mobil Oil Company known today.

　　Roosevelt initiated more than forty antitrust investigations during his tenure. Since then, antitrust in the United States has not stopped. Perhaps the most well-known antitrust case of the 1980s was the 1984 AT&T spin-off. In fact, AT&T faced two antitrust lawsuits in 1913 and 1949, but both were resolved. In 1984, this century-old enterprise failed to escape the fate of being split. In the end, AT&T was split into one long-distance telephone company and seven local telephone companies.

　　After AT&T was spun off, new telecom operators have sprung up like mushrooms after a spring rain. Competition has brought great prosperity to the US telecommunications market, and a number of companies such as MCI (American World Communications Corporation) and Sprint (Sprint) have risen rapidly. Competition also brought benefits to consumers, with U.S. call prices falling by 40 percent in the late 1980s.

　　So, why antitrust? The purpose of anti-monopoly is to remove barriers to competition, which means that e-commerce sellers do not have to choose one or the other on major platforms, which means that music and film and television works do not have to be signed exclusively, which means that advertisements can be advertised wherever they are cheap, which means that in the future The need to spend the greatest energy on doing a good job of products and services instead of standing in line means that small and medium-sized enterprises can finally focus on running instead of hurdles. Removing the barriers of competition brings all things growth.

　　So, what opportunities will anti-monopoly in China's Internet industry bring? It will bring about the third opening of the traffic ecology. The first connection of the traffic ecology is the connection between offline and online, and the second connection is the connection between the public domain and the private domain. However, after these two connections, we still have one thing we have to do: stand in line.

　　On November 22, 2013, WeChat users found that clicking any Taobao link in WeChat would automatically lead to the download page of the Taobao APP, because Taobao blocked the link of WeChat. Later, WeChat also blocked Taobao's links, and users could only "copy the link to a browser to open it". The Internet in China looks interconnected, but the doors are actually closed to each other.

　　Whether it is Alibaba, Tencent or Baidu, whether it is free e-commerce, free social networking or free search, these "free" are actually ways to accumulate traffic. In the end, the traffic is mainly sold to merchants through advertisements based on bid ranking. , to achieve commercialization. Therefore, these Internet platforms require users to enter through their own portals, not from others' links, otherwise others will become front-end monetizers, while it can only become a back-end server.

　　Therefore, these Internet platforms will ask users to choose one or the other. Especially for enterprises, if they are on Alibaba's side, they can only buy traffic from Alibaba and then trade here; if they are on Tencent's side, they can only buy traffic from Tencent, and then Tencent deal. These are two closed loops that are not connected to each other, and you have to choose one. What stands between Alibaba and Tencent are platform barriers.

　　Now, WeChat can open Taobao links, and Alibaba has begun to support WeChat payment. what does that mean? This means that the platform barrier has been broken through. Connectivity is about breaking network effects. For the Chinese Internet, the doors will go from being closed to each other to being open to each other.

　　The first and most intuitive benefit is that the cost of purchasing traffic will drop. Because after breaking through the barriers, companies can advertise on various platforms. No platform can enjoy super high advertising revenue because of closure, and no seller will need to pay excessive advertising fees because of closure.

　　Secondly, it may have a longer-term impact, which is that sellers can freely form a business closed loop that suits them. Sellers can choose the entry and exit of their final transaction according to their own advantages and characteristics, instead of being forced to complete all the links on a specific platform.

　　This is the third opening of the traffic ecology. A large number of small companies will grow wildly under the irrigation of traffic, and the "water level" of the Internet platform will be gradually leveled.