As long as they keep it, they can get users and traffic.” “They view the app as online infrastructure. “Tencent doesn’t rely on WeChat for revenue,” said Chen Yuetian, a partner at Chinese investment firm S.Capital.
#Tencent wechat pay 800m download#
Instead, the company generates tens of billions of dollars in annual sales from its gaming business, often relying on WeChat to direct users to hit titles such as Honor of Kings and a localized version of PlayerUnknown's Battlegrounds.Banner ads of both games are often displayed in users' social circles, connecting them to outside download links. Ads appearing inside WeChat public blogs - which can cost from several thousand yuan to a million each and can be placed multiple times inside an article - are negotiated directly between advertisers and blog owners, with Tencent not taking a cut. While Facebook and Google are facing criticism - including from news mogul Robert Murdoch - for taking the bulk of ad revenue while paying content creators so little, Tencent is putting them to shame. (Photo by Justin Chin/Bloomberg)Īside from tipping, bloggers also make money from in-app advertisements. More On Forbes : How Chinese Super App Wechat Plans To Lock Out Foreign App Stores In ChinaĪn avatar is displayed in an arranged photograph of the Honour of Kings mobile game, developed by. Last week, it finally reached an accord with Tencent, agreeing that tipping should be resumed while updating its app store policies to officially include the function. smartphone giant, desperate to grow its service revenues in China amid a drop in smartphone sales, has been trying for the past year to classify such a tipping system as an in-app purchase, so it can take a 30% cut. Secondly, Chinese people are more willing to pay for content now.”Īnd this isn't popular with Apple. “Firstly, it is because mobile payment is very easy in China. “It is a cultural phenomenon,” said Matthew Brennan, founder of consultancy China Channel. Zhang Yi, founder of iiMedia Research, estimates that each active blogging account receives a monthly average of 40 yuan($6.3) in these "tips" - which normally range from between 10 yuan ($1.6) to 50 yuan ($7.8) per article - and it's not unusual to see at least 200 million yuan ($32 million) in transactions processed on a monthly basis, given that there are some five million active blogging accounts, according to Zhang. And with the help of Tencent’s digital payment service Ten Pay, users are even sending their favorite bloggers gifts - often cash - via a function called Zan Shang, or tipping. As China’s younger generation grows tired of the lengthy, often stilted writings of state media as well as other more established news organizations, they are turning to social media for information, often spending hours a day reading inside the app. To people like Lin, WeChat works perfectly well. In 2015, the entire WeChat platform was valued at $83.5 billion, and today owner Tencent has reached more than $500 billion in market capitalization - surpassing the value of Facebook. But unlike Facebook, WeChat doesn’t rely on an artificial intelligence-based algorithm to recommend content - meaning a blogging account only gains exposure when users share articles with their own social circles. As of 2017, there were more than 15 million in-app public blogs, which both individuals and companies can register and then publish directly to their followers, according to iiMedia, a Guangdong-based consultancy. The sheer scale of WeChat’s media business is enormous.