What's WeChat? 微信是什么？

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Among the other items revealed is that
WeChat has up to 697 million active users
now, worldwide, having added about 200
million to that figure each month.

At the point when Tencent initially started
WeChat back in January 2011, no one
thought that the application was an e-
commerce and online networking giant,
with over almost a billion clients.

The last half decade saw China’s former
social media giants get used to living in
WeChat’s shade. Renren, “China’s
Facebook,” has seen its valuation crumble
to a fifth of its 2013 high as users flocked
to more feature-rich apps. And Weibo,
while hardly obscure, has long since been
eclipsed by WeChat’s enormous user
base.

In the year 2010, when messaging
applications at the time were novelties, we
lived in a world of SMS texts. From Kik to
SMS, WeChat China today is such a unique,
innovative platform that it’s easy to forget
that it was originally framed to be.

The first version of WeChat released in
early 2011, right into the midst of a
messaging app revolution. As mobile
users grew bored and frustrated by the
limitations of SMS, a new kind of app
began sprouting throughout the world.

Kik, WhatsApp, and Viber all launched in
2010, and the next year saw WeChat,
Line, and Facebook Messenger roll onto
the global stage. In China, a nascent
Xiaomi launched Milao, while many
Chinese internet users logged into Twitter
aims at Weibo for more than just
commenting on the news.

“WeChat had competition when it
launched. [But] Weibo just wasn’t very
good at interpersonal communication,
so it left a giant hole,” says William Bao
Bean, Managing Director of
Chinaccelerator and partner at SOS
Ventures.

Whichever app managed to exploit that
hole in China and grab a hefty market
share in 2011 and 2012 would become the
incumbent. WeChat was able to outflank
its domestic competition by rolling out in-
demand features on an insane schedule.

Within one year, the app had expanded
from its simple text/voice/picture offerings
to include video messaging, a “shake”
feature to find nearby users (which
doubled as one of China’s new answers to
Tinder), and more.

If that wasn’t enough of a leg-up over
the local competition like Xiaomi and
small startups, WeChat was also able
to leverage Tencent’s massive QQ
user base. While other services
required email addresses or phone
numbers to log in, WeChat simply
needed a QQ account

By early 2012, WeChat had 100 million
registered users, and China’s other
messaging apps were already in the
dust. But what about the international
competition?

Beyond text messaging, video and voice
calling, its services includes games, social
network timeline, shopping, branded
accounts, and more. Payment is another area
and over the past year, Tencent has put
considerable focus into its China-based
service, WeChat Pay, is used to transfer funds
between WeChat users (peer-to-peer) and
make online payments with some offline
retailers.

Tech In Asia tested it out for a day in
China. Eventually, they were
reasonably impressed, although it
seems there’s room for improvement.
Tencent disclosed that by November
2015, 200 million user cards were
attached to the payment service.

Tencent revealed that it banks
over RMB300 million, an
equivalent of $56M USD, that
is charged from WeChatPay
bank transactions, almost all
was from China.

Currently, the service was
started in South Africa through
its first expansion that was
international. Tencent offers it
globally to all merchants who
can use it to take payment
from Chinese tourists.

That is hugely impressive, and it shows
WeChat’s growing platform might be a
significant threat to Alipay, the service by
Alibaba’s $60 billion-valued payment
affiliate. Alipay had not revealed its
annual payment or revenue volume since
2013 — when it recorded $519 billion —
though that figure will be much higher
now.

While Alipay is China’s top payment
option with 500 million users and
200 million credit cards, the
mainstream adoption and use of
WeChat contribute massively to its
success.

Tencent is also dropping fees for transactions that
are peer-to-peer, a move that aims at making
WeChat a standard platform for transferring
money between friends. Another new policy
developed by WeChat is that it charges users a
small fee for the transfer of certain funds from
their WeChat wallet to their bank accounts, this
incentivizes them to retain funds in their
application wallet account, which will presumably
then be spent on or distributed to others via the
service.

WeChat makes money through
advertising and games. The
President Martin Lau revealed that
Tencent’s does not anticipate
WeChatPay to become a profitable
business as it subsidizes
merchants and other costs.

But, the real value, Lau said that
WeChatPay is for the benefit of the
overall ecosystem empowering future
advertisements with one-click
purchasing and promotion by users, as
well as synergies with financial
services like Tencent’s online bank or
wealth management fund.

Tencent’s primary goal is not only
facilitating chatting but also making
WeChat platform a gateway into the
country’s booming service economy,
where everything from manicures,
food delivery to car washes are all
sold online. Smartphones are a crucial
entry point to China’s online-to-offline
sellers.

While WeChat claims victory, analysts
say it should be watchful of other
threats. WeChat banks from
advertising. WeChat’s app future
mostly depends on how it deals with
the information explosion on the app.
If it continues that way, in a period of
about year, WeChat will hit its peak.

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What's WeChat? 微信是什么？

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What's WeChat? 微信是什么？