China's market regulator has imposed a massive penalty of 5.179 billion yuan (approximately $711 million) on TRIP.COM-S (09961.HK) for abusing its dominant market position, marking one of the largest antitrust fines in the country's internet sector history.
The internet industry has long embraced a globally recognized ethical standard: "Don't be evil." This principle, established by Google at its founding in 1999 and formally written into its 2004 IPO prospectus, carries a simple message: companies can profit, grow, and even dominate markets, but they must never use their size to bully users, squeeze suppliers, or undermine market rules. Profit is a business's instinct, but ethics are its bottom line.
Unfortunately, many Chinese internet giants focused only on "getting big and strong" while abandoning the commercial conscience of "doing no evil." On July 25, the State Administration for Market Regulation issued a severe penalty that confirmed this, labeling TRIP.COM-S as a prime example of a large company that did evil.
The full penalty details, sourced solely from official announcements, include: fines totaling 5.179 billion yuan, comprising a 3.521 billion yuan penalty and confiscation of 1.658 billion yuan in illegal gains. Additionally, the company must fully refund 122 million yuan in unfairly withheld hotel deposits. This is not a simple fine. It is a lesson from regulators to all internet giants: no matter how large your scale, you cannot place yourself above the rules; no matter how much traffic you have, you cannot arbitrarily harvest an entire industry.
Where to begin
In its early days, TRIP.COM-S, like the early Google, was a problem-solver. Twenty years ago, booking a hotel for travel relied on offline stores and phone calls, with opaque pricing, rampant price gouging, and cumbersome booking processes. TRIP.COM-S emerged, integrating national hotel listings, standardizing price display, and simplifying the booking process. It genuinely reduced travel costs for ordinary people and helped countless hotels open online sales channels. Through convenience, transparency, and efficiency, TRIP.COM-S steadily rose to dominate the domestic travel and hotel market, becoming the absolute industry leader.
However, the most fatal flaw of internet platforms is that initial intentions are easily lost, and consistency is hard to maintain. Once a company monopolizes a market and faces no effective competition, its corporate mindset changes completely. Instead of serving users and empowering merchants, it begins to use its absolute bargaining power to create bully rules and harvest profits from the entire industry. The core of Google's "Don't be evil" is not manipulating algorithms, not kidnapping users, not being swayed by capital, and not bullying upstream or downstream partners. In contrast, the larger TRIP.COM-S became, the more it reversed this principle, turning "evil" into an industry norm.
Why just two major abusive practices
From 2020 onwards, TRIP.COM-S leveraged its monopoly position to engage in two long-standing abusive practices, squeezing hotels, manipulating the market, and harming consumer rights.
First, it forced "exclusive dealing" by using traffic to kidnap the entire industry. TRIP.COM-S introduced a so-called "Special Hotel" system, a form of disguised monopolistic exclusivity. Hotels that agreed to abandon platforms like Douyin, Meituan, and Tongcheng and use only TRIP.COM-S received traffic advantages, top rankings, and surging orders. Any merchant wanting to operate on multiple platforms, seek more business channels, or earn more profit was immediately subjected to traffic limits, ranking demotion, and removal from the program. Many small B&Bs and county-level hotels had no ability to resist. Non-compliance with TRIP.COM-S could lead to an immediate 70-80% drop in orders, effectively forcing them to close. The platform was supposed to be a merchant's helper, but TRIP.COM-S became a merchant's creditor.
Second, it forced the lowest prices across the entire internet, directly seizing merchants' pricing power. This is the most abusive and exploitative practice. TRIP.COM-S built a smart monitoring system that compared prices across the entire internet 24/7. If a hotel set a lower price on another platform, the system would automatically and secretly lower the price without the merchant's consent. Hotels had no independent pricing power. Wanting to raise prices to maintain profit? That was a violation. Wanting to offer off-season discounts to attract traffic? That was restricted. Any slight resistance could result in deposit deductions, fines, or traffic cutoff. On the surface, this provided low-room prices to consumers. In essence, it locked in the entire industry's profits, forcing hotels to cut corners on cleanliness, reduce services, and lower quality to survive. In the short term, users get a bargain, but in the long run, the entire industry degrades, and everyone becomes a victim. This is a classic case of a large company doing evil: using market hegemony to make merchants unprofitable, eliminate competition, and drain industry vitality.
Looking at internet giants
Beyond TRIP.COM-S, looking at all major antitrust fines in recent years reveals a similar pattern. Alibaba's 18.2 billion yuan fine stemmed from e-commerce "exclusive dealing," which held brand merchants hostage. Meituan's 3.4 billion yuan fine arose from food delivery "exclusive dealing," which squeezed small restaurant owners. Didi's 8 billion yuan fine was due to disorderly expansion and ignoring data security red lines. All giants follow the same path of decline: starting with innovation, then relying on monopolies for easy profits, and finally doing evil to make money.
Google enshrined "Don't be evil" in its corporate constitution because it understood a key truth: technology and scale can make a company strong quickly, but conscience and ethics are what allow a company to last. While foreign giants are wary of "doing evil when large," many domestic giants are recklessly draining industry benefits and market trust. They have fallen into an arrogance that their size, user base, and industry indispensability place them above the rules. The belief that they are "too big to regulate or fine" emboldened them. However, the severity of this penalty against TRIP.COM-S shatters that illusion. The fine-to-revenue ratio of 7.5% far exceeds the 4% penalty on Alibaba and 3% on Meituan. The regulator's message is direct and resolute: market size is a benefit granted by the market, not a license for evil. Past achievements do not offset current misconduct, and scale does not exempt one from punishment.
How the industry benefits
Many wonder: what is the use of fining a platform? The answer is significant: it corrects the entire internet's distorted business model.
First, it restores dignity and rights to merchants. Hotels will no longer be forced into exclusive dealing or locked into the lowest prices. They can freely operate on multiple platforms, set their own prices, and earn reasonable profits. They won't have to work for the platform or be arbitrarily manipulated by traffic.
Second, it restores fair competition to the market. It breaks the monopoly stalemate, allowing platforms like Douyin, Tongcheng, and Meituan to compete fairly, vying for better service, user experience, and benefits. A market with full competition is the only way to truly generate value and genuinely benefit consumers.
Third, it reshapes the industry's ethical baseline. Google's "Don't be evil" is not just an empty slogan. It tells all tech companies that profit must have boundaries, expansion must have limits, and power must be paired with conscience. The value of a platform is to connect supply and demand, improve efficiency, and serve society, not to use its dominance to harvest, squeeze, and kidnap the entire industry. Companies can become large, but they must never become large and evil.
From Google's initial "Don't be evil" to TRIP.COM-S's 5.1 billion penalty, 30 years of the internet wave have proven the most basic truth: all money earned through monopolies, squeeze, and bully clauses will eventually be repaid many times over. The era of barbaric growth is completely over. The only path for future internet giants is to respect rules, respect merchants, and treat users well. They can pursue strength, but they must uphold their conscience. They can pursue profits, but they must never do evil when large.