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Cover Stories Series 2013> WeChat's Overseas Plan> Archive
UPDATED: April 21, 2013 NO.17 APRIL 25, 2013
A Debate on the WeChat Fee


Recently, the plan of China's major telecommunication operators to charge a fee for Tencent WeChat, a mobile phone text and voice messaging communication service, has become a hot topic. The Ministry of Industry and Information Technology commented that it is considering reasonable proposals put forward by the operators, but would not let them curb value-added services by taking advantage of their monopoly status. Thus far, it seems unlikely that fees will be introduced or that consumers will see a sharp increase in payments.

The issue was subsequently raised at the Boao Forum for Asia this year in early April. The result of a survey among more than 3,000 people on the topic was released at the forum, which showed that 71 percent of respondents oppose fee charges while only 9.8 percent of them support the idea.

It is suspected that operators are keen to cash in on the potential of Wechat to which they are losing a large percentage of market share. The following are comments related to the issue.

Liang Jian (The Beijing News): The boom in digital communication poses a striking contrast to the slowdown and even withering of conventional voice message service business. This is an irreversible trend that will continue in the coming years, with users addicted to convenient and cheap online network services.

Strangely enough, the issue regarding the introduction of fees was first raised by China's major telecom companies and relevant government departments and not by Tencent.

It is less possible that WeChat users will be charged, because users could easily find other Apps for smart phones and enjoy free text or voice messaging services. So, the point is that in what ways is the "tiny" messaging service threatening these telecom giants? WeChat still requires both sender and receiver to install softwares, but if a new service that is free of the limitation of sofewares appears, will it easily grab WeChat's market share?

After the Ministry of Industry and Information Technology licensed virtual network operators, companies like Tencent, which are pioneering instant messaging and digital voice services, will further eat into the telecom cake.

Ding Jianting (Nanfang Daily): WeChat involves over 300 million users in China. The debate on whether this service should be free is on going, with operators promoting charges while Tencent remains adamant in keeping its services free. Meanwhile, netizens themselves are collectively opposed to the fee proposal.

However, the dispute does not pertain to ordinary consumers. The commercialization of WeChat services is inevitable, its development route perhaps is the same as that of QQ, an instant messaging software service developed by Tencent, which offers clients a choice between free and value-added services while profiting as a platform for ad companies. Even if operators do charge fees on Tencent, basic services will remain free to users.

Reasons for possible charges to Tencent are threefold. First, the operation of WeChat occupies resources on communication networks. Second, operators have developed their own instant messaging services for mobile phones, with fees meant to protect business. Third, Wechat supports chat and video calls, which diminishes operators' market shares in text and voice services, threatening the monopoly.

On the other hand, Tencent has its own reasons to refuse the introduction of fees related to its services, arguing that WeChat service makes it possible for telecom operators to charge increased Internet traffic fees.

Mobile Internet technology, with WeChat as a typical example, is posing a serious threat to traditional business models. However, it is a market rule to see the replacement of old products by the new. Actually, this is also an opportunity for conventional business providers to update their products. To abuse a monopoly or seek government protection should always be the last resort.

Fundamentally speaking, telecom operators and Tencent are not total enemies but partners. It's unwise for either side to destroy WeChat because of personal interests. Monopoly should never be allowed to hinder technological progress.

Bai Jingli (Guangzhou Daily): Realizing that WeChat poses a threat, major telecom operators have decided to confront Tencent by proposing fees. WeChat services include 300 million users and adds to the burden of network operation. However, users still pay quite a lot for the Internet.

Because of their monopoly status, major telecommunications operators have already harvested a lot of money and are attracted to the profitable micro messaging industry. The real problem facing enterprises is innovation and how to offer cheap and quality products to consumers. However, operators are more interested in charging fees than to progress the products and services they offer. The best way to solve this problem is to deal with monopoly itself.

Charges will probably be imposed on WeChat. The ironic thing is that, if such services are finally discarded by users due to high fees, telecom giants will also suffer a loss in profits.

Yang Yu (CCTV): A lot of public misunderstandings exist regarding micro WeChat charges. Telecom operators should charge Tencent itself instead of actual users. The plan is somewhat reasonable in that it involves a redistribution of profits among service providers. As Chang Xiaobing, Chairman of China Unicom said, operators and Internet companies are supposed to develop good cooperative partnerships.

A good commercial rule should be beneficial to the vast majority and encourage innovation. If telecom operators rest on charging Tencent and fail to offer updated products to consumers, fees will be no good. When an online product supplier can make use of the huge resources of telecom firms only for own gain, the lines of a market economy are crossed. Therefore, the fee charge issue is something between the enterprises involved. The government should not interfere, though it does have the responsibility to maintain balanced development of the overall market.

So what do users care about? Firstly, we are concerned whether services will be more convenient and cheaper. Secondly, whether the basic rules of market economy are fully met. Thirdly, we are concerned whether technological innovation is being encouraged.

Email us at: zanjifang@bjreview.com

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