Ctrip made 29 billion RMB in the first three quarters,

but was under investigation for anti-monopoly practices, and its stock price plummeted 14% at the open.

The State Market Supervision Administration said they developed a "Pricing Adjustment Assistant",
which secretly changed hotel room prices in the background without informing hotel merchants,
this is considered abuse of market dominance.

Ctrip, along with Qunar and Tongcheng, together accounts for 60% of the market,
even its competitor Tongcheng has 24% ownership by Ctrip as a major shareholder,
what does this count as?
Citibank estimates fines could range from 500 million to 5 billion.

What did Ctrip do wrong?
The truth is it hit the "success trap" of Chinese enterprises.
Ten years ago, the government encouraged you to grow big and strong,
with mergers and acquisitions supported by policies,
but now the same tactics have become clear evidence of monopoly.

Making big money has become a problem, high profits are equated with exploitation.
This is the dilemma of socialist market economy:
You need to answer to shareholders for profit pursuit,
but you can't earn too much,
or it becomes politically unacceptable.

That "Pricing Adjustment Assistant" was originally a dynamic pricing algorithm,
called business innovation in Silicon Valley,
but in mainland China, it became a tool for "depriving pricing rights" and bullying.
The technology hasn't changed,
what has changed is who calls the shots.

Remember Alibaba was fined 18.2 billion in 2021 for "choosing one of two",
accounting for 4% of its annual revenue that year. How much was Ctrip fined?
The number isn't important,
what matters is that entrepreneurs have discovered a harsh reality:
Legal compliance no longer guarantees safety,

because how rules are interpreted depends on the political climate.
The stock market responds most honestly — Chinese concept stocks are valued at a long-term discount,

which essentially is paying for this uncertainty.
When both "growing big" and "not too big" are requirements,
this is fundamentally an unsolvable problem.