Customers purchase goods at a convenience store, dubbed as "Tmall Xiaodian," in Hangzhou, capital of East China's Zhejiang Province. A revamp by a retail unit of Alibaba with big data technologies has made the nine-year-old store more efficient and convenient, as a part of Alibaba's New Retail program. Photo: IC

China's antimonopoly push for online platforms reached the strictest phase and is making powerful waves through the industry, with 12 major platform firms including Baidu, JD.com, ByteDance and Pinduoduo publishing their law-abiding compliance operation commitments on Wednesday.

This came just one day after regulators ordered all platforms to conduct self-inspection and rectify there businesses within a month as part of an unprecedented overhaul of the platform economy. 

Hailing the increasingly frequent antitrust push as an unparalleled effort to intensely benefit innovative start-ups, especially the fledging ones that would be easily nipped in the bud if breaches of market competition orders were to continue, industry participants reckon that the capital-centric approach to churning out internet titans that has underpinned the country's explosive growth in the online arena will be redesigned.

But instead of signaling an end to the golden era for Chinese tech gurus, as some critics argued, the revamp will set China's internet economy on the path to a truly innovation-driven future, the analysts said. 

The first batch of 12 platform firms - including Baidu, JD.com, Meituan, ByteDance and Pinduoduo - published their commitments to operate in compliance with laws, according to a statement from the State Administration for Market Regulation (SAMR) on Wednesday.

Baidu vowed to oppose monopoly practices and unsustainable capital expansion and report certain concentrations of undertakings to market regulators when such concentrations touch the reporting threshold. It also promised not to sign monopolistic agreements with other platforms, read the statement.  

JD.com said it would never force merchants to choose one of two platforms, never abuse its market dominance rules and never carry out monopolistic agreements, and it would shun malicious competition as well as unlawful monopolistic practices. 

The online retailer, one of Alibaba's closest rivals, also said it would fulfill its responsibilities to protect intellectual property rights, while refraining from collecting individual information illegally. 

Chinese tech giant ByteDance, the parent company of Douyin and TikTok, made similar commitments about not implementing monopoly agreements or abusing market dominance. It also said it wouldn't publish illegal advertisements or collect personal information in an illegal way.

Alibaba, which has been at the heart of the antitrust whirlwind and received a record $2.8 billion antimonopoly fine over the weekend, was not among the first batch of platform firms to make the announcements. Its fintech offshoot Ant Group was ordered to overhaul its businesses. 

The commitments were made publicly available only one day after the regulators issued a one-month ultimatum to all platform firms to fix their breaches of market competition order.

China's central bank also pledged to push for antimonopoly work in the payment sector on Wednesday, adding to the country's antitrust ammunition.

Chinese artificial intelligence (AI) start-up CloudWalk Technology holds a welcoming attitude toward the compliance push, a company spokesperson told the Global Times on Wednesday. 

Along with an accelerated legislation process, the AI sector will gradually move into a healthy development trajectory with a greater focus on the use of normative technologies and products, which would benefit rule-abiding businesses, the spokesperson said.

The development of new technologies always comes with runaway growth, with some people or companies applying technologies in inappropriate areas to their advantages. Take facial recognition, for example: some firms would tap the technology to allow for big data-based price discrimination against existing users, the spokesperson continued, arguing that AI firms would be forced to remodel and upgrade their businesses.

The big data-powered price discrimination is among the noncompliance practices subject to the one-month rectification deadline.

In a statement sent to the Global Times on Wednesday, Chinese online property brokerage platform Beike Zhaofang said it has held to law-based operations and continued to improve its compliance system for there to be technology-driven and sound industry development.

Applauding the antitrust regulatory toughening as an imperative reform drive to rectify a capital-fueled deviation from what was supposed to be inclusive growth in the internet era, a seasoned industry veteran told the Global Times on Wednesday on condition of anonymity that fledging start-ups in particular would get a much-needed boost.

The veteran cited the money-burning approach to fighting fast in the community group-buying arena that has seen established platform giants set up "theaters of operations" to quickly drive out smaller rivals and assume leading positions.

In so doing, a few behemoths could easily capitalize their wide-reaching networks of resources and access to funding to expand into more spheres while a multitude of smaller start-ups that would become the backbones of the country's internet innovation and employ many internet-savvy professionals could easily be strangled halfway through their entrepreneurial stages, the industry veteran commented. 

With the capital market obsessed with monopoly-induced premiums - platforms with larger market shares tend to get higher valuations - internet businesses have long hinged growth on an expansion move that's faster than their peers and a resulting work atmosphere of sacrificing work-life balance, the veteran said.

"It's absolutely wrong that the golden days will come to an end for online businesses. Instead, they are set to embrace a truly innovation-centric era as fair competition would prevail in the internet sphere to let the most innovative ones survive."

That would suggest the current capital-centric approach to churning out internet titans will have to be redesigned, with existing valuation models refashioned accordingly, observers said.