Apple Inc.

Tencent Launches A Likely Future Competitor To Apple Inc. (NASDAQ:AAPL)’s App Store

Tencent has launched a service that could prove to be a competitor to Apple Inc. (NASDAQ:AAPL)’s App Store in years to come. This came on the tenth anniversary of the iPhone. On Tencent’s WeChat, users are now able to download and install mini apps developed by third parties from within the app.

Currently, users are now able to hire a bike on Mobike, make online purchases on JD.Com Inc(ADR) (NASDAQ:JD), get Didi’s shared rides plus make use of more than a hundred ‘mini apps’ without exiting WeChat. This makes WeChat the first platform of its size to offer an alternative choice to the App Store.

No cut

When compared to fully-fledged apps, the mini apps offer basic functions. And while App developers are required to pay 30% of their sales revenues from paid apps, WeChat is not demanding any cut. The mini apps are also ‘operating-system-neutral’ and will, therefore, run on both iOS and Android without any noticeable differences.

In launching the mini apps function on iPhone’s 10th anniversary, Tencent said that it was meant to give tribute to Steve Jobs and the company he founded. However, Apple is likely to interpret that as a challenge to the dominance it holds in smartphone apps.

The move by Tencent is also going to pile pressure on Apple’s Chinese operations as the tech giants profits in the most recent quarter fell by 20%. And after pressure from Chinese authorities, the California, Cupertino-based tech giant agreed to block the app of New York Times on its Chinese App Store.

Pessimism from some quarters

Tencent’s foray into the in-app platform has, however, been greeted with pessimism by some.

“Platforms for app distributions have been attempted before — Google and Baidu attempted to do this from their search engine interface — but we’ve seen limited attraction,” remarked Sandy Shen of Gartner, a tech research firm.

At present, WeChat has the highest frequency of use in China with mobile users in the most populous country in the world. Of the combined time spent on mobile devices in China, 35% of it is on WeChat.

Apple Inc fell by 0.42% in Thursday’s trading session to close the day at $119.25 a share.

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