Alibaba and Tencent have reached a 'century-long reconciliation'.

On September 4, Taobao released a "Consultation on Adding WeChat Pay Capability to Taobao" and is expected to fully integrate WeChat Pay by the end of September. Taobao Tianmao responded that it has always adhered to an open cooperation philosophy, actively exploring interoperability and cooperation with various platforms to continuously enhance the shopping experience for consumers, making it more convenient, enjoyable, and efficient.

WeChat Pay responded that the function adaptation with Taobao merchants is currently underway, and to stay updated on the specific launch date, please refer to Taobao's platform announcements. WeChat Pay continues to uphold an open cooperation philosophy and actively explores interoperability and cooperation across various fields.

The 'ice thaw' between these two national-level applications marks an important milestone in the 'gradual' interconnection promoted by the two giants since the Ministry of Industry and Information Technology required internet companies to rectify issues such as blocking website links.

The mutual blocking between WeChat and Taobao has a long history. In 2013, WeChat banned Laiwang, an instant messaging app newly launched by Alibaba. Subsequently, Taobao Mobile officially blocked the ability to jump directly to Taobao products and stores within WeChat.

This ban lasted for nearly a decade.

Changes began in 2021. That year, WeChat announced that it would implement new external link management measures in phases and steps, successively integrating platforms such as Youku, Damai, Kaola, and Ele.me, which have lower strategic importance within Alibaba.

It is worth mentioning that Meituan, which once removed Alipay as an option on its payment interface, has successively launched Alipay Mini Programs for its takeout, hotel, cycling, and errand services since 2023. Data shows that its takeout Mini Program has been used by over 1 million people, while cycling and mobile power bank services exceed 4 million users.

Entering 2024, Alibaba and Tencent accelerated their interconnection. In January, Xianyu launched on WeChat Mini Programs; in March, WeChat supported joining DingTalk meetings within the app; in August, Taobao Special APP added support for WeChat Pay.

Now, the most representative super apps under these two giants have also been incorporated into the 'big logic' of interconnection.

According to 36Kr, the "Taobao Integration with WeChat Pay" project was an internal confidential initiative that began preparations half a year ago. Compared to WeChat Pay, Taobao Tianmao was more proactive in pushing this project forward as it carries significant strategic and business implications for Alibaba.

For Alibaba, integration means that Taobao Tianmao can reach the vast user base in WeChat Pay's lower-tier markets, where users have significant funds stored in WeChat Pay and rely on it as their primary or even sole payment tool. These users represent an incremental market segment in an already highly saturated e-commerce landscape.

According to official data from 2020, WeChat Pay was the preferred payment method in 83% of county towns, 78% of villages and towns, and rural areas, both higher than the 76% in urban areas.

Even though Alibaba-affiliated apps have a total user base of up to 1.1 billion (as of December 2023, per QuestMobile), with Taobao Tianmao accounting for the largest share, it still seeks growth amidst the new landscape of e-commerce competition following the "1+6+N" strategic adjustment. In the second quarter of this year, Alibaba Group's net revenue increased by 4% year-on-year, while Taobao Tianmao Group's revenue declined by 1% and Non-GAAP net profit decreased by 9% year-on-year.

WeChat Pay also needs growth, and integration with Taobao is bound to bring in new users while increasing transaction volume and enhancing financial performance. According to Tencent's financial report for the second quarter of this year, revenue from FinTech and enterprise services, with WeChat Pay at its core, grew at an annual rate of 4%, trailing behind value-added services at 6% and significantly underperforming online advertising at 19.5%.

The 'century-long reconciliation' holds strategic significance for both parties, and the mutual concessions between Alibaba and Tencent represent the new normal in the consumer internet space.

As the bonus era of the consumer internet comes to an end, competition among enterprises intensifies, and the industry lacks strategic-level innovation directions. The 'war of a thousand models' in AI is unlikely to yield quick results like the battles for food delivery and ride-hailing services. The internet ecosystem needs new competitive and cooperative relationships.

During the height of the ride-hailing wars, WeChat Pay's team was stationed at Didi to support its operations. As order volumes surged, servers often overloaded. Cheng Wei called Ma Huateng for help, and Tencent promptly prepared 1,000 servers overnight to accommodate the influx of users after large-scale subsidy wars.

During the intense head-to-head battles between Toutiao and Tencent, Toutiao directly recruited from Tencent's headquarters, promising double salaries and at least a 50% raise. Tencent had to break many old rules to prevent Toutiao from poaching talent, such as extending non-compete clauses to grassroots employees and hiding employee phone numbers and WeChat contacts publicly displayed on Enterprise WeChat.

From food delivery wars to ride-hailing wars and head-to-head battles between Toutiao and Tencent, giants invest heavily in new market opportunities, which are crucial to their long-term strategic layout. For instance, food delivery and ride-hailing services can transform the efficiency of the catering and taxi industries, potentially attracting tens of millions or even hundreds of millions of new users. Another example is the battleground for short videos, which is the new attention 'high ground' of the mobile internet era.

However, the new opportunities in the consumer internet are scarce, and competition has gradually weakened.

Community group buying, considered the last major battle in the consumer internet, has seen stricter restrictions on employee behavior among giants. The first lesson in new employee training often focuses on 'internal anti-corruption red lines.' Competition for market share mainly revolves around basic tactics like offering slightly higher commission rates to group leaders compared to competitors.

The local lifestyle services war between Meituan and Douyin, which has intensified in recent years, has mainly focused on price wars within Meituan itself, requiring that the price of the same group-buying package must be one yuan cheaper than Douyin's.

Changes in the competitive landscape reflect the new paradigm in the mobile internet era. When the entire market lacks significant new opportunities worthy of significant investment, it prompts giants to shift their attitudes towards ecosystem openness. After all, growth and profitability remain the unchanging truths of the internet industry, while the form of cooperation becomes less important.

In September 2023, Wu Yongming, the new CEO of Alibaba Group, issued his first letter to all employees upon taking office, stating that Alibaba must shift its focus more firmly towards users, with user needs taking precedence over all else. He also mentioned that Alibaba's various businesses should proactively seek the broadest range of openness and cooperation, including with traditionally competitive companies, from a user-centric perspective.

Even ByteDance and Tencent, once bitter rivals, have sought peace. In April 2023, Douyin and Tencent Video reached a cooperation agreement on long-form video content licensing. Former e-commerce competitors have also laid down their arms. In November 2023, consumers noticed that the flagship Hema store had officially opened on JD.com.

The internet landscape has changed dramatically. The days of 'investing 100 points of resources for 120 points of growth' are long gone. The more restrained and controlled competition in the internet industry has also made it more open and collaborative.

In 2017, Wang Xing, CEO of Meituan, said in an interview with Caijing magazine, "Where is there a real 'final outcome'? Everyone must accept that competition and cooperation are the new normal in the second half."

The 'world war' in the internet industry has ended, and both businesses and consumers must learn to adapt to the new normal.