On February 2, Tik Tok formally filed a complaint with the Beijing Intellectual Property Court to sue Tencent for monopoly. This is the first domestic antitrust lawsuit between Internet platforms since the publication of the "Guidelines for Antitrust in the Field of Platform Economy (Draft for Comment)" at the end of 2020.
Tik Tok argues that Tencent restricts users from sharing content from Tik Tok through WeChat and QQ, which constitutes a “monopoly behavior that abuses market dominance and eliminates or restricts competition” prohibited by the Anti-Monopoly Law. Tik Tok asked the court to order Tencent to immediately stop this behavior, publish a public statement to eliminate adverse effects, and compensate Tik Tok for economic losses and reasonable expenses of 90 million yuan.
Public reports show that in April 2018, WeChat and QQ began to ban Tik Tok, and users who shared Tik Tok links to the above platforms were unable to play normally. It has been for nearly three years. However, Tencent's and other third-party short video applications, such as Weishi, Kuaishou, etc., can be shared and played normally on WeChat.
In the complaint, Tik Tok stated that instant messaging applications had become the basic applications with the largest scale of Internet users, the highest penetration rate and the highest usage rate. The monthly active users of WeChat and QQ exceed 1.2 billion and 600 million, respectively. Coupled with their instant communication and sharing functions and network effects, it is almost impossible for users to migrate collectively. In addition, there are currently no other operators in the market that can provide services equivalent to WeChat and QQ, which means Tencent "has a dominant market position."
Tik Tok believes that Tencent's ban on Tik Tok is a sign of abuse of market dominance. The ban damages the rights and interests of users, disrupts the normal operation of Tik Tok products and services, and eliminates and restricts market competition. "(Tencent's) monopolistic behavior hinders technological progress and innovation, and does nothing to improve economic efficiency and social well-being. It can only help it distort competition in other fields and consolidate its existing market position."
It is worth noting that Tik Tok sued Tencent for monopoly, which may be closely related to the current domestic anti-monopoly situation. At the end of 2020, the State Administration for Market Regulation issued the "Guidelines for Anti-monopoly in the Field of Platform Economy (Draft for Comment)." The document clearly pointed out that hongbao (red paper containing money as a gift) subsidies, brand blocking, "two choose one" and using the big-data analysis to disadvantage existing customers, search power reduction, traffic restrictions, technical obstacles, etc. may become manifestations of abuse of dominance, and antitrust case in the platform economy does not necessarily need to define the relevant market.
