Pinduoduo Says Hard to Judge How Interoperability Between Alibaba and Tencent Will Affect Growth Prospects
(Photo : Pinduoduo Says Hard to Judge How Interoperability Between Alibaba and Tencent Will Affect Growth Prospects)

Pinduoduo said it was monitoring the impact of interoperability between Tencent and e-commerce market leader Alibaba as China's government released rules aimed at weeding out practices that harm market competition. 

The State Administration for Market Regulation, China's antitrust watchdog, released draft rules this month that prohibit behaviors such as blocking traffic to competitors and external sites. 

"We are monitoring the progress in interoperability as it will serve as an example for the industry and platform companies," said Chen Lei, Pinduoduo Chairman, and CEO. "We think that an open internet ecosystem has positive impact for the long-term healthy development of the industry and society."

Tencent and Alibaba, China's two largest internet platform companies, are reportedly considering opening up their services to each other. Previously, Tencent's social-messaging app WeChat generally would not allow links to Alibaba's platforms, and vice versa. 

Pinduoduo has amassed 850 million users as of the end of June, according to its second-quarter results. The company posted an 89% increase in total revenue in the quarter, below what investors expected. While it recorded a rare profit, management warned it was unlikely to recur given its heavy investments into agriculture.

The company separately announced a "10 Billion Agriculture Initiative" aimed at fostering innovation and adoption of agricultural technology and the development of human capital in the agriculture sector. 

Pinduoduo said its "10 Billion Agriculture Initiative" will take a long-term view to capacity building and not use profitability and commercial returns as yardsticks. The initiative will be funded by profits starting from the second quarter until the commitment of 10 billion yuan is met, the company said in a release. 

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