Why WeChat has made the three big Chinese telecom companies uncomfortable? Let's analyze from both technical and commercial levels.
From a technical point of view, Mr. Huang, Dean of China Mobile Research Institute, described the impact of "always online service" applications like WeChat. Instead of using technical terms, we will explain in simple vivid phrases.
First, mobile QQ, or WeChat, will have their own "request frequency". These requests are sent to the carrier network, to check the real-time status of itself, such as checking if there is status change or new news come up.
These "signaling" are not consuming much cellular data. However, they are occupying most of the signaling channel. If the frequency is too excessive, it will cause the operator's network problems, and even bring down the networks.
Weibo (Chinese version of Twitter), for example, after opening notification function, will check new posting periodically in every 30 seconds to 3 minutes. These frequent-sent-requests are about six times of the normal web browsing activities, but only consumes less than 1KB. Same case for mobile QQ. Years before in Guangdong province, because the the mobile QQ application was occupying too many signal channel, a few local Chinese Mobile telecom network users cannot make phone calls or send messages. After negotiating with Tencent (SEHK:700), change was applied to mobile QQ application and issue was resolved too. However, WeChat is now facing a more serious situation than mobile QQ. In order to maintain a good user experiences, WeChat has to keep a very high frequency of sending and receiving requests, while the telecom operators wishes all the normal functions like phone call and message are not interrupted.
From a commercial point of view, WeChat has a better user experience in sending messages and pictures, and making calls. Thus, WeChat has inevitably diverted the telecom operator's SMS, voice services, affecting their revenue growth.
However, we can expect that after the deployment of 4G network all of the above contradiction would be resolved.
First, from the technical aspect, in accordance with the statement of Mr. Huang, LTE 4G network is designed specifically for data, especially for the signaling problem. And 4G network has wide bandwidth and faster, in theory, also allows the use of WeChat to experience better. From the commercial aspect, the current contradiction, which is the impact on carrier messaging and voice services from WeChat, may no longer be a problem because the operator's revenue will be mainly from selling data. Taking a international carrier's data plan as an example, we can see that SMS and voice revenues are not the main as important as before anymore.Another example is the Verizon 4G ShareEverythingPlan, which consists of limited data plans and unlimited messages and calls. Thus, those impact from WeChat could be ignored.
"In Hong Kong, and many other foreign countries, most carriers are selling data packages. Tencent will generate a lot traffic, and it should be cooperation relationships between us and telecom operators". said chairman of Tencent Mr. Ma.
Source : http://www.singhunt.com/node/5 Note:This article is authorized by editor of SingHunt.com to publish.
