Tencent Is Going After Sina Weibo

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  • on January 16th, 2012

I have written about Tencent’s Weibo efforts in Will Tencent’s Weibo Spending Spree Destroy Sina’s Weibo Profit Potential? and Can Tencent Weibo Threaten Sina Weibo?. My point was that Sina ($SINA) investors should never underestimate a company like Tencent.

Tencent wants elite Chinese netizens, has nearly unlimited resources, and recently bought a large stake in white-collar SNS Kaixin001, of which Sina was a 20% or so shareholder.

Today we have a terrific post from Kai Lukoff about Tencent’s Weixin product and the inroads it is making with white collar users–With Weixin Lifestyle, Tencent Is Finally Building A White-Collar Brand | TechRice. From Kai:

Weixin is for White-Collars

With Weixin, Tencent finally has a product for white-collars (50 million registered, 20 million actives), an objective that had eluded the firm for over a decade. We at TechRice thinks that’s a very big deal.

Simon Fong, CEO of Xueqiu, writes:

Tencent’s problem is that it’s very difficult for it to reach the highest-end users at all. At the very least, in some situations it’s embarrassing to share your QQ number (whether a user has one is besides the point, this is about social conventions). But now Tencent has a new product that is finally penetrating that market: Weixin Mobile IM. Look around you, aren’t all your fancy friends using Weixin too?

Yes, yes they are–all of my fancy Chinese friends are now using Weixin. A new friend of mine signs up for Weixin virtually every day now, and I’m always prompted to add them because the app scans my address book. One senior Chinese media executive told me that 800 of his 2000 contacts (undoubtedly a far fancier contact list than mine) are now using Weixin.

So while the there’s significant similarity with QQ IM in functionality, there’s significant difference in user demographics and brand positioning. The penguin is for no-collars, blue-collars, and white-collars, while Weixin is for white-collar elites.

Sina has a big lead in Weibo, but unlike Tencent it does not have a massive, diversified, cash puking machine to subsidize a huge marketing war for China’s elite netizens.

You can follow me @Niubi on Twitter@Niubi on Stocktwits and @Billbishop on Sina Weibo.

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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