Alibaba Offers Instant-Messaging App to Compete Against Tencent

September 24, 2013 Leave a comment

Alibaba Offers Instant-Messaging App to Compete Against Tencent

Alibaba Group Holding Ltd., the largest e-commerce company in China, is offering an instant-messaging app as it tries to compete against Tencent Holdings Ltd. in the world’s biggest smartphone market. The app, called Laiwang, allows users to form group chats with as many as 500 people and share maps, videos and stickers, according to Alizila, a website run by Alibaba. It has about 1 million existing users, and the company wants to boost that to 100 million, the company said in an e-mail today.Alibaba’s competition with Tencent, operator of the WeChat service, comes as smartphone shipments in China are projected to rise to 450 million units in 2014 from 360 million this year, according to International Data Corp. More than 84 percent of China’s Internet users regularly access instant messaging, making it the most popular online application in the country, according to data compiled by Bloomberg.

“Alibaba wants to gain as many access points for users as possible,” said Alex Wang, a Beijing-based analyst at Internet consulting group IResearch. “Tencent has an existing advantage with WeChat and lots of users. It would be a challenge for Alibaba to compete in that sense.”

Tencent’s QQ instant messaging service had 818 million monthly active users at the end of June, and WeChat, known as Weixin in China, had 236 million. Tencent’s shares fell 0.2 percent to HK$409.20 at the close of Hong Kong trading.

Laiwang has privacy settings for photos and a “burn after reading” feature that deletes a message after the recipient has read it, according to Alizila.

Analysts expect Alibaba may consider an initial share sale that could be the largest since Facebook Inc. The Hangzhou-based company has a value of about $87 billion, according to the average of 11 analyst estimates released in July.

The number of people in China accessing the Internet via mobile devices rose 10 percent to 464 million by the end of June from six months earlier, according to the China Internet Network Information Center. That’s greater than the population of any other country except India.

To contact the reporter on this story: Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.net

Filed under TMT Trends

Unknown's avatarAbout bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

Leave a comment