China's mobile payment war escalates

Unavoidable war

Outright war in the mobile Internet market does not seem avoidable as consumers want to get connected all the time.

By the end of 2013, 500 million Chinese were accessing the Internet via mobile phones, accounting for 81 percent of the country's netizen population, figures from China Internet Network Information Center showed.

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"Most Chinese netizens are not satisfied in using the Internet sitting down at a table. They want to use it anytime anywhere," said Hu Yanping, director of DCCI Data Center of China Internet.

"This is the reason why the two firms are promoting mobile Internet products. Mobile Internet services will make people's lives more comfortable and convenient," he said.

The two have different approaches.

Alipay wins users mainly through money transfers and credit card debit payments. Tencent attracts mobile payment service users through its mobile social-networking and game apps.

"It's too early to say which will top the mobile payment market as two thirds of the market has not been developed yet," said Hu.

He said the winner will be judged on four areas essential to profit. These are the number of registered users, user activity, monthly mobile payment by the average user, and the number of merchants that accept payment via phones.

Once fully developed, China's mobile payment market will be four times as large as that of the e-commerce, Hu predicted.

Apart from cab-calling services, there is competition in personal finance products, maps, meal-ordering, social-networking apps, mobile gaming platforms as well as e-commerce.

Tencent announced on Wednesday that it had purchased a 20-percent stake in the country's lifestyle and group buying website Dianping.com.

Dianping's content, user base and offline retailer network will be integrated with Tencent's social communications platforms, to build an online-to-offline service, according to a joint statement.

Alibaba, on the other hand, has completed its acquisition of digital mapping and navigation firm AutoNavi for $1.39 billion, turning the latter into a fully-owned subsidiary.

AutoNavi will not only direct smartphone users of how to get to places but also tell them about where their favorite services and products can be found.

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