Tag Archives: Wechat

Wechat latest Business & Financial news from Doug Young, the Expert on Chinese High Tech Market, (former Journalist at Reuters)

INTERNET: Facebook Inches Closer to China with Tencent Poach

Bottom line: Facebook’s new hire of a top WeChat executive could be the latest signal that it expects to get permission to launch a China-based service soon, possibly by the end of this year.

WeChat exec defects to Facebook

Following several months of relative silence, social networking (SNS) giant Facebook (Nasdaq: FB) is back in the China headlines, with word of a major executive poach from China’s leading SNS company. This particular headline is filled with mixed signals. On the one hand, the hire of a former top executive from WeChat looks like a significant move closer to China, since the hugely popular Chinese SNS operator would be Facebook’s main rival if it’s ever allowed into China. But on the other hand, the executive is a foreigner from WeChat’s international division, which has been a poor performer in the service’s weak attempts to go global. Read Full Post…

INTERNET: Car Inc Drives Onto OTC, Yidao Spars with WeChat

Bottom line: Car Inc’s hired car services unit’s $5.5 billion valuation on China’s New Third Board is hugely overinflated, while Yidao’s new clash with Tencent shows the regulator needs to become more active in oversight of WeChat.

Two of China’s second-tier hired car services providers are in the headlines heading into the weekend, as these smaller companies fight an uphill drive to attract attention away from industry giants Didi Chuxing and Uber. The larger of the 2 stories has the hired car services unit of car rental leader Car Inc (HKEx: 699) receiving approval for a listing on China’s over-the-counter (OTC) New Third Board, valuing the company at a hefty 37 billion yuan ($5.5 billion). The second story has Yidao getting in a tussle that has seen promotion of its services blocked on Tencent’s (HKEx: 700) wildly popular WeChat platform . Read Full Post…

TELECOMS: Telcos Fight Enterprise Voice Rivals, Regulator Resists

Bottom line: The MIIT should be commended for resisting pressure by China’s 3 telcos to ban free private voice services for enterprise customers, but should move quickly to show it will license such service providers like DingTalk and WeChat.

DingTalk halts free enterprise voice service

The ongoing battle between China’s big 3 state-run telecoms carriers and an emerging field of private sector challengers was in the headlines last week, when rumors emerged that the regulator was set to stop private firms from offering free voice services for business customers. The move looked set to potentially shut down popular services provided by Internet giants Tencent (HKEx: 700), Alibaba (NYSE: BABA) and others, before the regulator clarified that licenses were needed for companies to provide such voice services. (Chinese article) Read Full Post…

FINANCE: Tencent Payments Take Off, Alipay Steps Up Asia Drive

Bottom line: Tencent’s new disclosure that it processes more than 500 million daily mobile financial transactions highlights its rapid growth in the space, pushing market leader Alipay to accelerate its own expansion into Asia.

WeChat wallet creeps up on Alipay
WeChat wallet creeps up on Alipay

It’s rare to see Internet giant Tencent’s (HKEx: 700) tech-savvy but reclusive chief Pony Ma do interviews or make public appearances, so when he does it’s always reason to take notice. In this case Ma has disclosed new figures that show just how rapidly Tencent is moving into the mobile financial transactions business, rapidly encroaching on an area previously dominated by Alibaba (NYSE: BABA) affiliate Alipay. A separate headline also reflects to some extent the pressure that Alipay is feeling, with reports that its parent Ant Financial is accelerating its recent move into several major Asian markets. Read Full Post…

TELECOMS: China Mobile Surrenders to WeChat, Youku

Bottom line: China Mobile’s retirement of its Internet-based texting and video services reflect its inability to compete with private providers of such services, and underscores its growing position as a slow-growth network operator.

China Mobile shutters Internet text, video services

In a move that was long overdue, leading wireless carrier China Mobile (HKEx: 941; NYSE: CHL) has thrown up the white flag with a symbolic surrender to WeChat, Youku and the many other private companies that have steadily stolen its new business opportunities. In this case the surrender comes in the form of formal retirements for China Mobile’s Internet-based Fetion texting service, and also its lesser known mobile video product.

Fetion was once hugely popular in China, allowing users to send SMS text messages for free by routing them over the Internet. China Mobile was an early innovator in creating that kind of “over the top” (OTT) service that took advantage of the mobile Internet. But more recently it has rapidly lost that position to more nimble private companies like Tencent (HKEx: 700) and Youku. Read Full Post…

TELECOMS: Colluding China Telcos Resist End to Roaming Fees

Bottom line: Beijing should take more aggressive steps to ensure true competition between China’s 3 telcos, to prevent collusion like their current resistance to ending domestic roaming fees.

China telcos resist end to roaming fees

The latest sign of collusion in China’s telecoms sector was in the headlines last week, as the nation’s big 3 carriers appeared to band together to counter new calls for an end to domestic roaming charges. A number of arguments were put forth for maintaining such fees, but the bottom line is that carrier costs of providing such service are negligible and the fees themselves remain an important revenue source.

The US market, which is most similar to China, eliminated such fees more than a decade ago due to competition between 4 major carriers that emerged in the 1990s. But China’s carriers, while competitive in some areas, appear to be acting together in anti-competitive fashion to resist the change, a common occurrence due to close ties between the companies. Read Full Post…

STOCKS: Tencent Hot, China Mobile Not in Q4 Results

Bottom line: WeChat’s growth will continue to fuel strong revenue gains for Tencent but could also create a drag on profits, while China Mobile’s profits are likely to be flat as savings from slower infrastructure spending are offset by big 4G promotions.

Transactions boom on WeChat 

High-tech leaders Tencent (HKEx: 700) and China Mobile (HKEx: 941; NYSE: CHA) are providing a nice contrast with their latest earnings reports, pitting one of China’s most innovative private companies against one of its biggest state-run laggards. The results cast a painful spotlight on China Mobile, China’s largest mobile carrier, whose profits sagged in the fourth quarter as it lost business to more nimble companies like Tencent. Meantime, Tencent’s profits and revenue posted healthy gains, as it provided data to generate excitement about its fast-growing but money-losing WeChat social networking service.

Shares of both companies reacted much as one would expect, continuing recent trends. China Mobile shares dipped 2.1 percent after its results came out, and are down about 15 percent over the last year. Tencent’s results came out after the market closed, but I expect they will rally in the new trading day. Over the last year they are up 5 percent, which is quite impressive when one considers the main Shanghai index is down 19 percent during that time. Read Full Post…

China News Digest: March 4, 2016

The following press releases and news reports about Chinese companies were carried on March 4. To view a full article or story, click on the link next to the headline.
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  • IBM (NYSE: IBM) Considers Selling Lenovo (HKEx: 992) Stake – Report (Chinese article)
  • Smartphone Growth to Drop to Single Digits in 2016, Led by China’s Maturation – IDC (Businesswire)
  • Trina Solar (NYSE: TSL) Announces Q4 and Full Year Results (PRNewswire)
  • LeEco (Shenzhen: 300104) Cloud Secures 1 Bln Yuan Series A Funding (English article)
  • Tencent’s (HKEx: 700) Pony Ma Explains Decision to Charge WeChat Money Transfer Fee (Chinese article)
  • Latest calendar for Q4 earnings reports (Earnings calendar)

STOCKS: Tencent Builds Empire, Profits on Socializing

Bottom line: Tencent’s sharp focus, strong management and savvy strategic tie-ups make it China’s best Internet investment for the long term, though its shares may feel some short-term pressure due to high valuation.

Tencent builds empire on SNS

This week the series on my favorite Chinese stocks takes us to the “Big 3” of Baidu (Nasdaq: BIDU), Alibaba (NYSE: BABA) and Tencent (HKEx: 700) , sometimes called the BAT super trio because they’re the country’s biggest Internet companies by quite a large margin. I’ll end the suspense right away by saying my favorite among these 3 is Tencent, the only one that’s listed in Hong Kong.

I’ll look briefly soon at some financials comparing this trio, but will openly admit my Tencent attraction is less based on market fundamentals and instead is tied to its corporate personality that differs quite a bit from the others. These “personalities” are a direct reflection of each company’s founder, since all 3 are relatively young and the founder of each is still quite clearly in charge. Read Full Post…

FINANCE: Apple Pay Buzzes China Mobile Payments Market

Bottom line: A strong reception for Apple Pay from consumers, banks and merchants bodes well for the service, which should attract a major audience among iPhone users but won’t pose a major threat to rival services from Alipay and WeChat.

Apple Pay launches in China

The launch of Apple Pay in China is buzzing through the local headlines a day after the roll-out, in a move that looks certain to shake up a stodgy industry dominated by homegrown names like Alipay. The most revealing headlines report on the rush by everyone, from consumers to banks and merchants to jump onto the Apple Pay bandwagon. That reflects the buzz that any major move by Apple (Nasdaq: AAPL) can create in the world’s largest smartphone market.

Local consumers are undoubtedly pleased that Apple chose China for the Asia launch of Apple Pay, selecting their market over more traditional candidates like Japan and South Korea. China is only the fifth global market for Apple Pay, following launches in the US, Canada, Britain and Australia. The pride element at being first in Asia, combined with Apple’s existing premium image here, will draw a big majority of Chinese iPhone and iPad users to try out Apple Pay on their devices. Read Full Post…

FINANCE: Beijing Gets Tough With WeChat Over New Fees

Bottom line: Tencent would be wise to roll back a newly announced money-transferring fee on WeChat following state-media criticism, which could indicate a tougher stance by Beijing due to the platform’s increasingly dominant position.  

Xinhua calls WeChat a catfish

It’s been quite a while since the last tussle between China’s influential central media and its vibrant private sector, so I was amused to read of a new flare-up in that regard after Tencent (HKEx: 700) said it would start charging fees for a money-transferring service on its popular WeChat platform. This looming flare-up has seen the state-run Xinhua news agency, often considered the voice of Beijing, criticize WeChat’s move as “excessive goose plucking”, which is quite a vivid description and certainly not too complimentary.

This particular assault is somewhat noteworthy, as it hearkens back to another similarly high-profile spat involving Tencent and WeChat 3 years ago. That tussle came as WeChat was beginning its meteoric rise, and saw leading telco China Mobile (HKEx: 941; NYSE: CHL) accuse the service of stealing its traditional SMS text messaging service. Tencent insisted at that time that WeChat would always remain free, defying China Mobile pressure to charge for the service and then divide the fees between the 2 sides. (previous post) Read Full Post…