Alibaba has recently adopted WeChat Pay on multiple apps such as Ele.me, Youku, Damai, Kaola, and Shuqi.
Alibaba's Taobao has implemented state-owned UnionPay's QuickPass in August and is adding WeChat Pay to apps like Xianyu, Hema Fresh, Taobao Deals. On Tencent's WeChat, Alibaba's mini-app Taobao Deals is currently under Shenzhen tech giant's review.
The change is another move amid China's anti-trust campaign. China's Ministry of Industry and Information Technology (MIIT) previously proposed standards requiring all platforms to stop blocking each other's hyperlinks. Industry moguls such as Alibaba, Tencent, ByteDance, Baidu, Netease, and others were ordered to remove their link-blocking mechanism before September 17, thus ending the era of digital "walled gardens".
Both Alibaba and Tencent showed their obedience of the anti-trust campaign by saying they welcome and encourage collaboration across platforms. In August, Alibaba's CEO, Daniel Zhang Yong, said that collaboration between platforms would lead to a win-win situation.
Tencent and Alibaba's stock prices both rose slightly after Alibaba adopted WeChat Pay.
Alibaba launched Alipay in 2004, the early times of Chinese e-commerce era, and received phenomenal success — for nearly ten years, Alipay dominated mobile payments as no other players in the field came close to even qualify as a rival.
Tencent released WeChat Pay in 2013 and grew to be a threat to Alipay with its campaign of "red pocket" function, a digitalized version of the traditional Chinese new year ritual. By pouring 500 million yuan to sponsored the Spring Festival Gala in 2015, WeChat Pay connected to 800 million users. WeChat Pay dethroned Alipay in 2015 when its user base surpassed Alipay, but its market share was still dwarfed by Alipay.
Ultimately, the cutthroat competition manifested in the form of link blocking — users weren't able to directly share links and had to share screenshots or code snippets instead.
The competition between two moguls is now deemed unlawful by regulators, as such turf war doesn't benefit users but only fuels an atmosphere of monopoly and unfair business practices.