
Why Facebook should worry about Tencent - arnauddri
http://blogs.hbr.org/2014/04/why-facebook-should-worry-about-tencent/
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ma2rten
Tencent is an interesting company, but this article is complete bogus.

    
    
        Tencent has learnt how to penetrate overseas markets. In 
        the online gaming industry, for instance, it has become a 
        player by buying equity stakes in Riot Games for $400 
        million; Epic Games for $330 million; Activision Blizzard 
        for $1.4 billion; 
    

So when tencent invests in a company, they are evidently "penetrating overseas
markets", but if Facebook acquires a company to gain international market
share it is a sign of their inability to build something themselves.

    
    
        Tencent enjoys the advantages of a giant social network as
        well as a history of innovation. It has repeatedly fought
        off competitors including messaging apps such as AOL Instant
        Messenger, Confide, Glide, GroupMe, iMessages, Instagram 
        Direct, Kik Messenger, Line, Popcorn, Tango, MessageMe,
        Snapchat, Shots, Skype, Twitter direct messages, Telegram,
        TigerText, Viber, which Japan’s Rakuten recently bought for
        $900 million, Whisper, Wut, and ooVoo.
    

What is this even talking about? This seems like a random list of apps which
are vaguely related to messaging. TigerText for instance is an internal
messaging app for enterprises.

To me it seems like a rushed article that the author wrote because he had to
meet some kind of quota.

~~~
chiph
To me, it looked like he was doing this to promote his book.

 _as I describe in a recently co-authored book,_

------
malanj
As a South African I find the global indifference to Tencent quite strange.
They are massive but mostly ignored (compared to e.g. Amazon which has a
similar market cap). Tencent are aggressively expanding WeChat into Africa
(big billboards everywhere!). They are also running a local development team
in South Africa to customise the app for the local market.

Tencent were funded by Naspers, a South African company, so I think we're much
more aware of them than most other countries. I've spoken with Koos Bekker,
the CEO of Naspers, about Tencent years ago. He said that they work much
faster than any US tech company he's every seen.

~~~
malandrew
Why do you find it strange? When I load tencent.com I get a blank page (I keep
javascript disabled by default) and then when I finally get the page loaded,
it loads in Chinese since it didn't detect my language either by HTTP header
or by IP. The page looks like the typical boring corporate home page (I can't
even tell it's a social network). I then switch to English and I see that
tencent.com is not the homepage for the social network, but the parent
corporation that owns the social network its responsible for. I can tell this
from typical corporate specific stuff like talking about stuff like quarterly
earnings and stock performance, their vision ("to be the most respected
internet company" ha!) and mission ("to enhance people's quality of life
through Internet services". lol). Obviously, there must be some other home
page I need to go to in order to join, but I can't tell what it is from the
tencent homepage and the tencent name is the only one I'm familiar with as a
foreigner so I don't even know what other domain I might put in the address
bar or what query I might execute in Google.

With product management like this, they are never going to penetrate beyond
China. Thinking they can compete with Facebook here is laughable.

~~~
Einstalbert
In addition, I think that they are definitely going to be a billion-dollar
company and will probably be very popular in South Africa where they have
roots, but to ask why people don't know or care about them as much as Amazon,
to name the example, seems... well, obvious. I order stuff from Amazon twice a
week! I've only ever heard of this company due to its Riot shares. I can see
why a South African wouldn't see Amazon as very interesting, though... do you
get 2 day shipping out there?

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logicchains
As a QQ user I'd like to note that it seems quite superior feature-wise to MSN
messenger, Gtalk, Facebook messenger and Skype IM. You can for instance paste
multiple images straight into the input box and send them just like text, and
it also has an extremely quick and easy to use screen capture feature. Not to
mention a reliable, indexed message history, offline file transfers (you send
it when the other person is offline, and when they sign in they'll be able to
receive the file), and accurate notification whenever a message you send fails
to be delivered.

Note however that I'm referring to the International Version; the mainland
Chinese version is less appealing, full of advertisements, and hides some
features behind paywalls.

~~~
est
you can't share full or partial screen like Skype in QQ.

~~~
logicchains
You can share screen via remote access, and optionally give the other person
shared control over your mouse, but I suppose that's not quite the same.

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arnauddri
Asia is a region which has proven its ability to innovate in the messaging
space and the internet as a whole. I believe Rakuten and Alibaba (through
their investment in Tango and Viber) along with Tencent are now ready to
compete with US juggernauts like FB

~~~
w1ntermute
I don't think that Asia has proven its ability to innovate in the
internet/messaging space. It's that significant cultural, language, and (in
the case of China) legal barriers make it hard for Western companies to
compete there. But at the same time, almost none of these companies have shown
the potential to expand outside of Asia, and the vast majority of them have
not even been able to expand out of their home countries.

Rakuten has tried to grow in the US market using its purchase of Buy.com, but
that's not working, partly due to a disastrous rebranding. They also had a
failed venture in China. So Viber may be successful if they just leave it
alone, but trying to use it to make Rakuten better known in the West would be
a horrible idea.

Naver (Korean) has the Japanese messaging service LINE (which was created by
some of its Japanese employees at its Japanese subsidiary), but can't gain any
other ground. And I definitely can't see the Chinese internet companies
becoming successful in Japan or South Korea, given their penchant for
censorship and nationalistic differences.

~~~
danford
Of course it could just be that it's just hard to have a globally successful
app, but consider the following:

China has their own social networks and messaging apps because they're
sponsored (openly or behind closed doors) by the state. The reason they allow
their citizens to use these apps is because these particular ones are being
used to intercept intelligence data, and are not controlled by western
entities. Does the chinese government have a hook in face book? If they did,
would they want the US intelligence agencies who are undoubtedly closer to FB
to have access to their citizens data? Probably not. Just as Chinese
intelligence agencies control the net over there, US and western intelligence
agencies control the internet over here, but in a much more secretive way as
we've seen with the recent snowden leaks. The reason Chinese services aren't
successful in the west is because the powers that be don't want them to be
successful, because then the west wouldn't have the proper hooks in the
Chinese social networks which are undoubtedly used for mass spying.

~~~
mimighost
It is not entirely true. The GFW did offer protect to the local companies from
the western giants at the very beginning. But this is just a side-effect.I
don't think that is because the CCP government prefers to sponsor the home-
grown ones.

No, one thousand time No. It hates internet as a whole.It tries, a lot of
times, throwing a huge money to put its own players on the market, but mainly
in the search engine space, like Remin, Jike, Pangu and the most recent,
ChinaSo. Only after all these attempts turn out to be failures, it looks back
and try to corporate with the private companies.

As a native Chinese, I think Wechat is a much better choice than Facebook, in
a lot of ways. Imagine what would happen, when Facebook put their Facebook
app, Whatsapp and Instagram together, plus gaming, mobile payment and other
bunches of stuff. That is what WeChat is right now. And it is used by hundreds
of millions of people. And that is impressive.

------
LiweiZ
I'm a native Chinese and started to use Tencent's products 15 years ago. I'm
using wechat as well since almost every Chinese I want to connect with has a
wechat account.

Information based product, esp. with strong social context, is highly related
with its user group. Even if every product in the narrowed domain is exactly
the same. They evolve to different products later and may not a better fit for
other user groups. And yes, the policy barrier set by the state is also a
major reason to provide room to have some follower strategy products survive
and grow strong. But market value is not a key indicator here. Money can not
buy you anything, esp. in information industry, in which a lot of people know
what a substitute product can do.

Also, if you want to worry about Tencent, just try their products to see how
polished they really are yourself.

In case you are interested, Porter five forces analysis
[http://en.wikipedia.org/wiki/Porter_five_forces_analysis](http://en.wikipedia.org/wiki/Porter_five_forces_analysis)
is a good framework and start to learn to have some idea of how to exam a
market in a more logic way.

~~~
notastartup
I'm not Chinese and have never heard of Tencent. I've heard of Facebook
though. I think the fact that it's based solely in China and Chinese users
would be a big barrier in being able to grow, as these social apps have a
networking effect, in which case it works amongst Chinese but might have
trouble with attracting non-Chinese speakers. just like if Brazil had their
own popular app amongst themselves, it would have a hard time penetrating
other countries.

~~~
lacero
I'm not Chinese and I'm not American. I have seen countless Tencent WeChat ads
while watching tv and especially during Champions League football. I have
never seen a Facebook ad on tv.

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zhte415
Tencent has been the elephant in the Global room for a long time. It sure took
a long time to be recognised.

It is also the elephant in China, in a very nice way. Its success being based
in Southern China seems testament to this. vs Baidu for example.

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nahname
Google search for Tencent brings up this article. Not sure if I even found
their real site.

~~~
doesnt_know
Really? I guess this means that this is the first time DuckDuckGo actually has
more relevant search results then Google.

[http://i.imgur.com/HHngy0Q.png](http://i.imgur.com/HHngy0Q.png)

(This comment is tongue in cheek. I use DDG as my main search engine but
sometimes it can just be... frustrating.)

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notastartup
If it's so big how come I've never heard of it but have of Facebook? It must
be that outside of China and Chinese users, it's irrelevant. I honestly don't
think Facebook has anything to fear unless the whole world became Chinese
somehow. Personally, I don't want to use a service based in a communist
country, NSA would be lesser of the two evils.

~~~
bsaul
I don't get why this comment was downvoted. I find the fact that china is
probably monitoring communications and data _much_ more systematically than
any other country ( because they are proficient technologicaly and a single-
party country), a very good reason why people in general wouldn't want to use
their service.

I would add to this comment that chinese themselves may very well prefer to
use US services, because they may very well be the first target, should they
decide to have different political views about their country.

