Ten­cent moves money on­line through Wechat

China Daily (Hong Kong) - - BUSINESS - By MENG JING mengjing@chi­nadaily.com.cn

The bat­tle be­tween China’s In­ter­net ti­tans in­ten­si­fied as Ten­cent Hold­ings Ltd started al­low­ing its WeChat users to make on­line pay­ments on Mon­day, a move that taps into the lu­cra­tive e- com­merce mar­ket, which is dom­i­nated by its archri­val Alibaba Group Hold­ing Ltd.

The WeChat plat­form, a mo­bile so­cial net­work­ing ap­pli­ca­tion de­vel­oped by Ten­cent, China’s largest In­ter­net com­pany by mar­ket cap­i­tal­iza­tion, re­leased its ver­sion 5.0 on Mon­day, in the prod­uct’s big­gest up­date since it was launched in Jan­uary 2011.

“Through WeChat, any per­son or any busi­ness can get all kinds of valu­able ser­vices in a much more con­ve­nient way,” said Zhang Xiaolong, se­nior vice-pres­i­dent of Ten­cent, in an of­fi­cial com­pany state­ment.

The new fea­tures of WeChat 5.0 in­clude so­cial games, scan­ner tools and most im­por­tantly pay­ment in­te­gra­tion, which is seen by many in­sid­ers as “the most ag­gres­sive func­tion” of all.

The WeChat pay­ment func­tion can in­te­grate bank ac­counts ( credit or debit card) with a cus­tomer’s WeChat ac­count, which al­lows WeChat’s more than 300 mil­lion users to make pur­chases on sev­eral e-com­merce plat­forms.

With the help of scan­ner tools, goods can be scanned us­ing a prod­uct’s bar­code, al­low­ing the user to jump di­rectly onto the e-com­merce web­site sell­ing the prod­uct and or­der it im­me­di­ately.

Lu Zhen­wang, an in­de­pen­dent In­ter­net ex­pert and the chief ex­ec­u­tive of­fi­cer of the Shang­hai-based Wan­qing Con­sul­tancy, said the lat­est ver­sion of WeChat has the po­ten­tial to be a gamechanger in China’s mo­bile In­ter­net world.

“Ten­cent, Alibaba and Baidu Inc, the top three In­ter­net gi­ants in China, each has a unique ad­van­tage in on­line busi­ness. Their ter­ri­to­ries are well-es­tab­lished and it is dif­fi­cult to break into their coun­ter­parts’ ter­ri­tory.

“But there is no dom­i­nant player in the on­line-to-off­line busi­ness sec­tor in China at the mo­ment. WeChat’s pay­ment func­tion is not based on the per­sonal com­puter but on the mo­bile phone, which can largely com­bine on­line and off­line busi­ness,” said Lu.

Lu added that the pay­ment func­tion has great po­ten­tial to be­come Ten­cent’s new source of growth and a strong chal­lenge to Alibaba, which ac­counts for more than 50 per­cent of China’s e- com­merce mar­ket.

McKin­sey & Co es­ti­mates China’s e-com­merce mar­ket will triple to $ 395 bil­lion from 2011 to 2015. Alibaba, the dom­i­nant player in this field, is head­ing to­ward what may be the big­gest ini­tial share of­fer­ing since Face­book Inc.

Ten­cent’s move is seen as the lat­est counter-of­fen­sive against Alibaba, which said last Wed­nes­day that it will block on­line sell­ers’ ac­cess to WeChat, cit­ing se­cu­rity rea­sons.

Shop­pers have in­stead been of­fered the op­tion to log on to Alibaba’s Taobao mar­ket­place us­ing their ac­counts on Sina Weibo, the Chi­nese Twit­ter­like mi­cro-blog­ging plat­form, start­ing on the same day that Ten­cent re­leased its WeChat 5.0.

The move is seen as an at­tempt to help ad­ver­tise the prod­ucts of some on­line ven­dors on Sina Weibo and try to re­di­rect po­ten­tial shop­pers from Sina Weibo to Taobao.

In April, Alibaba ac­quired an 18 per­cent stake in Sina Weibo for $ 586 mil­lion, fur­ther il­lus­trat­ing the col­lab­o­ra­tion be­tween the two com­pa­nies.

How­ever, Alibaba’s move will merely steer some shop­pers from Sina Weibo to Taobao, and it is not a break­through sim­i­lar to what Ten­cent did with its WeChat 5.0, said Lu Jingyu, an an­a­lyst on the mo­bile In­ter­net with iRe­search Con­sult­ing Group.

“Our re­search found that two Ten­cent apps, WeChat and QQ, have taken up about one- sixth of the to­tal time peo­ple spend on the mo­bile In­ter­net. That’s far be­yond what other In­ter­net com­pa­nies can reach,” Lu said.

Newspapers in English

Newspapers from China

© PressReader. All rights reserved.