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WeChat to set up US office

By  Fang Yunyu (Global Times)

09:50, March 04, 2013

China's largest Internet company by market value is gearing up to establish a branch in the US to develop its mobile social messaging service, WeChat, for the North American market, the company told the Global Times Monday.

"We are planning to set up our WeChat office in the US, in a bid to explore opportunities in the US market," Tencent Holdings said in a statement e-mailed to the Global Times.

The Hong Kong-listed company said the US WeChat office will be in charge of research and development for the US market, as well as building and expanding partnerships with US corporate clients.

"If a foreign product can succeed in the US market, where many excellent IT products and companies were born, it will be relatively easy for the product to go into other markets," Tencent noted.

Tencent declined to elaborate more on the office's location and scale when contacted by the Global Times.

Tencent announced last month that the total number of WeChat users had reached 300 million, including over 10 million overseas users, about two years after the Shenzhen-based company launched the mobile application.

"The figure may exceed 500 million by the end of this year, which will be equivalent to the number of Internet users in the country. In other words, it means the domestic WeChat market will very soon be saturated," Fang Xingdong, founder of the Beijing-based industry consultancy Internet Laboratory, told the Global Times Monday.

According to statistics released by the China Internet Network Information Center, Internet users in the country jumped by 10 percent year-on-year to 564 million by the end of 2012, while the total number of people accessing the Internet via mobile device surged by 18 percent to 420 million.

"Moreover, given competition pressures from State-owned telecommunications carriers, it is just the right timing for Tencent to start carrying out its overseas WeChat expansion," said Fang, noting that there will be some business challenges since US users are not familiar with Tencent or WeChat.

Some foreigners have already begun to use WeChat in China.

"I find the mobile app very convenient. It supports sharing multimedia with friends. No advertisements. No fees. And many of my friends in the Chinese mainland, Hong Kong and Singapore are using it to chat with me," Doug Young, an American who lives in Shanghai and has used WeChat for six months, told the Global Times. "So far, I haven't found any problems with the service."

Young said many Americans use the similar WhatsApp, which differs from WeChat in that people can chat with anyone they want, whereas WeChat requires users to add each other as friends before they can chat.

Fang said that despite fierce competition in the US, "WeChat can be regarded as the only Chinese Internet product that currently has the potential to tap the overseas market."

According to Tencent's latest financial report, its profit in the third quarter last year reached 3.2 billion yuan ($514 million), an increase of 32 percent compared to a year earlier. The company is scheduled to post its 2012 financial data next month.

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