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Meituan Dianping Cease Operation of Cloud Business Due to Business Adjustment

March 23, 2020 7:25 pm

Beijing (PingWest)- Chinese food delivery and lifestyle services platform Meituan Dianping will cease operation of its cloud business and stop service and support for users from 00.00 on May 31, 2020, the company said on Monday (March 24)

Explaining the rationale behind the decision making, the company said the termination is due to business adjustment without further elaboration. However, users have been warned to make data backup or system migration as soon as possible because any data cannot retrieved after the cessation.

“Meituan Public Cloud will stop service and support for users from 00:00 on May 31, 2020 due to business adjustments. The data cannot be retrieved after the resource are recovered. To avoid any inconvenience, we recommend to back up your data and migrate your system as soon as possible. You can also submit a refund request through the page link, we apologize for any inconvenience.” Meituan said in a statement

Launched in 2012, Meituan Public Cloud initially served as a unit for internal support, supporting Meituan’s daily business operation including food, movie, travel. Meituan begun to serve enterprise clients with cloud and big data solutions like data processing, infrastructure software service in 2015.

The business termination come at the time when Alibaba has intensified competition for Meituan in digital lifestyle service. Earlier this month, Alibaba announced that its mobile payment platform Alipay will open up to 40 million service providers, enabling these third-party vendors to offer digital lifestyle service such as food delivery and hotel booking, retail on its platform.

Many analysts reached consensus that Meituan’s decision to close public cloud business will help it to retain focus on its core business. Meituan has been criticized in the past for over-expansion into a various sector like ride-hailing, cloud business.

Enterprise cloud service is highly consolidated market that 90% of the market dominated by a few major players including Alibaba, Tencent and Huawei, but Meituan Public Cloud was not among the top 10. So it is quite usual for companies to downsize non-profitable business and shift more resource to core business.