China Needs to Break Monopoly of Internet Giants to Give Chance to New Entrepreneurs, Says JD.Com Founder Richard Liu

China Needs to Break Monopoly of Internet Giants to Give Chance to New Entrepreneurs, Says JD.Com Founder Richard Liu

Liao Shumin

Date: Mon, 11/20/2017 - 14:49 / source:Yicai
China Needs to Break Monopoly of Internet Giants to Give Chance to New Entrepreneurs, Says JD.Com Founder Richard Liu
China Needs to Break Monopoly of Internet Giants to Give Chance to New Entrepreneurs, Says JD.Com Founder Richard Liu

(Yicai Global) Nov. 20 -- "The internet is a natural monopoly industry. If 10 years later, China's three internet giants, Baidu Inc [NASDAQ:BIDU], Alibaba Group Holding Ltd. [NYSE:BABA] and Tencent Holdings Ltd, [HKG:0700], collectively referred to as BAT, still dominate in the industry, it is absolutely an unfortunate thing for China," said Richard Liu, founder and CEO of JD.Com, Inc. [NASDAQ: JD].

Liu’s criticism of the monopoly of the internet came at a ceremony held to introduce a new book written by Zhou Hongyi, founder and CEO of Qihoo 360 Technology Co. [NYSE:QIHU], on Nov. 19.

In the past the internet was in rampant growth and it was difficult to see a clear rule, Liu pointed out. The situation has improved over the past two years, but the polarization has become starker and the flow of web traffic has become increasingly concentrated. It is the same all over the world because the internet is a natural monopoly tool, Liu said.

It is very difficult for the traditional industries to form a monopoly. They often need administrative orders or the occurrence of major events, Liu reminded. But the internet is a natural monopoly field. So, in the process, you inevitably have disputes with others. “We did not want to dispute with anyone. However, when strangled to death, people always struggle. At that point, you may try to say something, but the media will exaggerate it and call you war provocateur. In fact, we were forced to do this," Liu said.

JD.com's model is not a complete commercial innovation, he explained. "We have entered the fe-commerce field accidentally. We have established our current position in the industry through fierce competition. We were unknown when we entered the e-commerce industry in 2004."

In 2006, Liu asked a ranking institution if JD.com could be included in the ‘Top 20’ list. Because the firm only selected the ‘Top 10,’ so JD.com was not included," he recalled. After 2012, JD.com managed to rank second in the industry. He said he regrets entering the industry too late. If he started the e-commerce business six years earlier when he was 25, JD.com would not have been the runner up in the industry, he suggested.

In the future, China's internet will enter the era of civilized development with less fighting and aggression among peers, Liu believes This process will not take too long. Five years will be enough to reach that level. If it takes 20 years, it will disappoint hundreds of millions of young people.

"Today, the internet industry is globally moving toward monopoly, which is a dangerous thing. Therefore, enterprises should not only fight, but also continue to make appeals to push the entire industry towards civilization. This is the only way to give a chance to countless number of new entrepreneurs. If BAT, JD.Com and Qihoo 360 still dominate the industry in China 10 years or two decades later, it is absolutely an unfortunate thing for the country," he emphasized.

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Keywords: monopoly, Baidu, Alibaba, TENCENT, JD.COM, Richard Liu