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WeChat owner Tencent sees profits surge
Tencent, China's biggest online entertainment and social network company, has reported a 47% jump in second-quarter profits. Net income for the quarter stood at 10.9bn yuan ($1.6bn, £1.23bn), beating analysts' expectations. Revenue grew at its fastest rate in more than three years, the firm said, climbing 52% to 35.7bn yuan. Tencent is best known for its messaging app WeChat, which dominates the local market. Market dominance Out of China's three internet titans, the online gaming and social media company Tencent is the biggest, but also the least known in the West. Tencent has not attracted the same global attention as its rivals: Alibaba, with charismatic millionaire entrepreneur Jack Ma at the helm, and Baidu, the local equivalent of Google. However, its WeChat service is just about the biggest app there is in China. According to many Chinese users, it is way ahead of anything people use elsewhere in the world. Its key element is the integration of a wide spectrum of online services all bundled in one single app. WeChat screenshotImage copyrightWECHAT Image caption WeChat is the clear market leader in China WeChat offers just about everything from messaging to calling, mobile games, food deliveries and online shopping, payments, even down to splitting the bill when you're out with friends. The app has more than 700 million people using it and has an unrivalled dominance in the Chinese market, but it is not Tencent's main source of revenue. "Online gaming has long been the driver for Tencent and it's key to understanding the revenue mix," Duncan Clark, technology analyst and chief executive of consultancy BDA in Beijing, told the BBC. Gaming giant In June, it was announced that Tencent Holdings and its partners are to buy a majority stake in the Finnish maker of the Clash of Clans game. The deal values Supercell at around $10.2bn (£6.95bn) and Tencent will buy the stake from Japan's SoftBank Group, which invested in Supercell in 2013. Clash of clans bannerImage copyrightSUPERCELL Image caption Clash of Clans is only one of Supercell's successful games Founded in 2010, Supercell's other games include Hay Day, Boom Beach and Clash Royale. Like so many other Chinese tech companies, Tencent was initially labelled as being a copycat, filling the gap created by Beijing banning Western online companies to enter the Chinese markets. Youtube was substituted by Youku, Google by Baidu, Amazon by Alibaba, while WeChat took the place of Whatsapp. It was initially developed out of QQ which was a Chinese version of the desktop messaging pioneer ICQ. And there is some truth in the assessment that these companies initially got their ideas from modelling themselves on a Western company. But the days of mere copying are over, many of those companies have mastered the blueprint they were built on - and often have developed further from there. "China has increasingly become the centre of mobile innovation," Mr Clark explains. "It's rather that there's a gap now in the West, because people tend to miss what's happening in China."
The App That Helps The Chinese Masses Mobilize Online
The mobile messaging app WeChat has taken China by storm in the past couple years, swiftly becoming the largest standalone-messaging app, with more than 300 million active monthly users. It has an ever-growing array of functions, from text and voice messaging to photo sharing. Perhaps most importantly, WeChat users also have the ability to form groups of up to 500 people. That sets it apart in a country where the government controls citizens' ability to organize. It has enabled the creation of virtual, nationwide networks, and made WeChat the primary tool for Chinese citizens who want to organize around any given idea or cause. Tencent, the Chinese Internet company that owns Wechat, also has an older, PC-based messaging app called QQ, which also has group chats, and a base of 800 million active monthly users. Beijing University media scholar Hu Yong argues draws a comparison to Weibo, China's popular microblogging app that is similar to Twitter. "What Weibo has done for freedom of speech, WeChat has done for freedom of association," Hu says. China's constitution guarantees its citizens the freedom of association, but Hu points out that in practice, registering a non-governmental group is very difficult, and many non-registered groups exist in a legal limbo. Black Apple Youth is one Chinese group that has made extensive use of Wechat to build a network. The non-profit is the brainchild of Victor Yuan, a prominent independent pollster. On a recent weekend, Black Apple Youth held a leadership training session for college students. The group's Executive Director Michelle Ling says Black Apple Youth has 20 Wechat groups, each of which has many subgroups. "They're divided according to activities," she explains. "For example, we held a training camp in August, and all the participants formed a group. Then we also have 6 groups representing different regions of the country, as well as one for overseas members." Members must be invited to join a WeChat group. You can't just search for a group and join. Experts see the way that the app builds on existing social networks as one of its "Chinese" characteristics. WeChat also includes a payment function, which groups use to raise funds or to vote by paying. Related NPR Stories Cloud Data Security Concerns Raised After Reported Attack In China ALL TECH CONSIDERED Cloud Data Security Concerns Raised After Reported Attack In China China Gets A Big Dose Of Fine Art Photography PARALLELS China Gets A Big Dose Of Fine Art Photography But Michelle Ling says that her group takes precautions when using WeChat. "We don't encourage our young people to get involved in excessively radical discourse that may affect our organization's future, or takes political positions that are too obvious," she says. China's Nomads Have A Foot In Two Very Different Worlds PARALLELS China's Nomads Have A Foot In Two Very Different Worlds Then there are people like Li Yiping, an activist based in Vancouver. He wrote an online manifesto whose title can be roughly translated as "Strategy for Regime Change." His strategy is to use WeChat simply as an online tool to organize offline meetings of pro-democracy activists. He advises activists to keep all political discussions offline, and to avoid creating formal leadership structures that authorities can target. Police have arrested many activists at offline gatherings. That includes members of the New Citizens Movement, led by activist Xu Zhiyong, whose methods resemble those advocated by Li Yiping. But Li says that overall, his prescriptions for mobilization have been effective. "Through the use of this strategy, we've already broken through the Communist Party's ban on non-governmental political groups," Li says. "Behind the party's iron curtain, we have already found limitless space to develop. They can't monitor, much less suppress our form of organization." This year, the government has also banned the unauthorized posting of political content on WeChat. But it continues to allow people to form WeChat groups. Media scholar Hu Yong says the government is a quick learner. If it chooses to, it can assert control over new technologies very easily. And just because the government hasn't clamped down on WeChat groups yet, it doesn't mean they won't do it later.
Chinese Tech Company Combines Multiple App Types Into One — At Great Profit
The company Tencent has developed the world's second largest standalone messaging app Wechat, with over 300 million users. ROBERT SIEGEL, HOST: Yesterday, we heard how a popular messaging app called WeChat is helping Chinese to organize in ways that they couldn't before. Now we'll hear about the app's maker, Tencent. It's one of the world's most valuable Internet companies, though it's not a truly global brand. NPR's Anthony Kuhn reports from Beijing on Tencent's rise. ANTHONY KUHN, BYLINE: "Blade Of The Three Kingdoms" is Tencent's most frequently downloaded game these days. You can download it for free, but to upgrade your blade you need to pay the equivalent of a few cents or a few dollars. You can find the games through Tencent's two popular messaging apps, WeChat and QQ. Together they have over a billion users, so if even just 1 percent of them pays a buck each to upgrade a weapon, Tencent still rakes in $10 million. Hong Bo is a Beijing-based tech blogger. He says that among the world's big Internet companies, only Tencent makes most of its money from consumers, not advertising. HONG BO: (Through translator) Many people didn't think this model could achieve any significant scale. Tencent is the first to prove that they could make this their primary business model and achieve a market value of over $100 billion. KUHN: Both Tencent's revenue and market value have now surpassed those of Facebook. This has made Tencent's 43-year-old founder, Ma Huateng, one of China's richest men. Ma means horse in Chinese and he goes by the English name of Pony. Tencent declined requests for an interview. Speaking to state television last year, Pony Ma described how he sees Tencent evolving. (SOUNDBITE OF ARCHIVED RECORDING) MA HUATENG: (Foreign language spoken). KUHN: What we want to do is become an economic system - a platform, he says. We want to invite our partners on to that platform to develop new services. In other words, Ma wants Tencent to cater to Internet users' every need so Tencent has been buying up shares in other Internet companies, trying to create a company that's WhatsApp, PayPal, Uber, Amazon and Yelp all rolled into one. Internet industry analyst Xie Wen points out that combining all those functions into a seamless whole is, technically speaking, a very tall order. Xie Wen: (Through translator) Tencent's weakness is that its content is too jumbled. It has too many services and products. It hasn't even integrated its messaging apps, QQ and WeChat. So Tencent faces the biggest challenge among its peers. KUHN: Tencent's main Chinese rivals are the search engine Baidu and the e-commerce giant Alibaba. They too are snapping up smaller companies, trying to construct their own one-stop shops. They haven't done very well either in getting a foot in the door of Western markets. Tech blogger Hong Bo says differences in language, culture and politics will take years for them to overcome. BO: (Through translator) I think most Chinese firms see the American market as their final destination - the place they ultimately want to get access to. But it's very difficult for them to do that at this stage.
Knowledge Graph
Examples
1 Tencent has a big ambition for WeChat and envisioned it to be a social mobile platform.
2 In China, the new kid on the block is WeChat, which launched in 2011 offering text and voice services.
3 Message Me in the U.S. is essentially a clone of WeChat.