China’s QQ coming after MSN and Skype

I was in a Cisco briefing the other day and an executive mentioned a service in China called QQ. It is an instant messaging service and it has taken China by storm.

QQ is owned by Tencent and the company is releasing an enterprise version of QQ to compete with Windows Live Messenger and Skype.

According to its Wikipedia page, QQ has more than 300 million accounts and is getting some significant traction in of all places South Africa.

Tencent is in the North America market with its QQ Games. They also signed a strategic agreement with Intel to develop a green Internet.

The two sides will cooperate on server and efficiency optimization projects and will host research on server virtualization. The plan will also include mobile Internet terminals.

QQ was the official IM provider of the 2008 Olympic Games in Beijing and will also be the official provider at the 2010 World Expo. Not bad for a 10 year old company. Tencent’s business plan is to build more services on top of its IM service. These include: mobile & telecommunications services; interactive entertainment services; something called Internet value-added services; E-commerce services, and an online advertising service. The company has also developed its own currency called QQ-Coins.

What makes this strategy interesting is that all of its IM users will be sort of forced fed these other services. Some may not like them, but at the very least they will know about them and may want to try them out.

The strategy will enable Tencent to continue to build on its base of users, increase its revenue from fees from these loyal users, without a lot of marketing or knocking on doors. is the 17th most visited Web site in the world, according to stats from, which measures Web traffic. is ahead of such high profile Web sites as Ebay, AOL, Flickr and

Very little is known about QQ in North America, but the sense I have is that they are coming after Skype, Yahoo Messenger and MSN Messenger in this space.

The company is also providing a Linux-based version of QQ. Now if that community takes a hold of it then it is possible that QQ may make a splash in North America.

What will make it tough for QQ is that people today enjoy using Skype and MSN. The same way people in China enjoy using QQ. The fact that Skype and Microsoft have invaded its turf means that Tencent will take a shot at the lucrative North American market. Fair is fair and Microsoft and Skype certainly understand this.

As an alternative play in business there is always a chance for a QQ-type offering to make some headway. But, decision makers in the enterprise will look for reliability first and foremost and if you are a solution provider that is something you have to deliver. Would a solution provider risk using an unknown such as QQ over proven technologies from MSN and Skype? I just don’t see it.

But it will be interesting to see how they do.

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