Meituan Holds Power over Chinese Food Delivery Market

A new government antitrust probe is making waves in China and this time, it has hit an Alibaba competitor for a change. Food delivery giant Meituan – part of the Tencent empire - is being investigated by Chinese regulators on the suspicion that it used its market dominance to force restaurants to pick it as their sole delivery service or be dropped.

Numbers from CBNData and Trustdata show that Meituan controls two thirds of the somewhat consolidated Chinese market. Alibaba-backed competitor Ele.me controls the remaining third with its trademark delivery service and premium subbrand Star.ele.me, which was acquired from Baidu in 2017 as Baidu Waimai.

Alibaba was first in line to be probed by Chinese officials over monopolistic practices and received a record fine of $2.8 billion earlier this month – the highest ever recorded in China. The company has accepted the fine and said it served as guidance. The tone was more amicable than in October 2020, when Alibaba co-founder Jack Ma accused regulators of “stifling innovation” after the IPO of his payment service provider Ant Group was scrapped at the last minute over regulatory concerns.