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Tencent Lets WeChat's rapid growth do the talking

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Tencent Holdings Ltd.'s free messaging service, WeChat, has seen its popularity grow among both individual users and businesses, even amid a dispute with the Big Three telecom operators.

Since launching in January 2011, WeChat, the mobile text and voice messaging application, now has more than 300 million users. The rapid growth has caught the attention of various businesses seeking to explore opportunities on the platform.

Guan Peng, the chief executive officer of Internet service provider China35.com, said: "WeChat will be a gateway to mobile Internet. There will be many opportunities for third parties by opening a public account."

Since WeChat launched public account services for business in August, it has attracted a large number of companies, such as media outlets, retailers and e-commerce providers who use the platform for promotions or to offer services to customers.

Dong Jiangyong, co-founder of Venture Capital Fund, said that with further development of WeChat's Application Programming Interface (API), which enables marketers to automate many functions with their subscribers, WeChat will offer more business opportunities.

However, Tencent has not established a clear business model for WeChat. Tencent said it has been exploring ways to balance all the business activity and comfort user experience.

"Both the developers and WeChat are seeking better coordination and balance," said Du Minglun, an investment head of Innovation Works, an incubator for tech start-ups.

Ma Huateng, chairman of CEO of Tencent, said: "There are various ways to use WeChat. Some are created by users and we never thought of them."
 
Ma said the most mature business model on the WeChat platform is the value-added serviced provided to the mobile online community and gamers, but there was still lots of rooms for innovation.

However, pressure from telecom operators has caused uncertainty for Tencent and WeChat. The Big Three telecoms want to charge the app because of the bandwidth it uses, causing speculation that the popularity of WeChat will be hurt.

A New Battlefield

Zhao Fei, founder of Web game developer Beijing Leiyoo Information Technology Co., said his team benefited from WeChat. Leiyoo, which opened its account in February, gives its followers quick access to mobile games. Zhao said the company added 8,000 new users in one month at no cost.

Zhao expected better interaction with users to improve as the WeChat platform developed, which will enable its company to offer more diversified services – and profit models.

WeChat has been working on the development of new functions for enterprise accounts, Ma said. But another company source said that except for mobile games, other WeChat applications for commercial use need time to develop.

Tencent has encouraged businesses to open accounts on WeChat. "We hope to build a platform and channel to connect with different business models," Ma said.

People like Cheng Lingfeng have joined the exploration. As an independent Internet commentator, Chen has more than 30,000 followers on his WeChat account and has sold 13 ad orders for a total of 10,000 yuan.

Chen said WeChat is changing the rules set by traditional media and will encourage the development of more independent media. Nevertheless, traditional media outlets have also started to use the WeChat platform to offer content to subscribers.


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