On July 30, China Unicom announced the highly anticipated "WeChat Wo Card" would be launched in 8 days. Tencent also introduced the usually reserved Zhang Xiaolong to attend the launch event. Of course, their jointly launched "WeChat Wo Card" aims to attract market attention with five exclusive privileges.
This is a collaboration where each party has its own intentions yet shares a common goal. It is also the smartest move by Tencent, as an OTT provider, facing the powerful giant China Mobile.
In fact, this product offers some privileges that are not quite "killer-level," such as more WeChat features, more data discounts, unlimited premium numbers, and group chat permissions for up to 60 people which may not seem very impressive. However, it conveys a concept: OTT providers and telecom operators can collaborate, and after collaborating, they can better bind users.
Unicom wants to tell users: use me, my rates are cheap, convenient, and I offer special services, making you look cool. Tencent, on the other hand, wants to express externally: see, collaborating with OTT providers can lock in more users, and OTT can help you as an operator increase user stickiness.
In fact, whether or not acknowledged verbally, whether or not subjectively aiming for this goal, one objective result of Tencent and Unicom's joint creation of the "WeChat Wo Card" is putting pressure on China Mobile. Behind this so-called "ice-breaking journey," it is Unicom intensifying its efforts to acquire users before the arrival of 4G.
An internal person from China Mobile said: "We don't care at all. Previously, we were very nervous, fearing that Unicom might offer unlimited data for 10 yuan, which would ruin us. But looking at the current packages, we can rest assured."
In the 3G era, China Mobile was the operator that complained the most about OTTs. This is because the large amount of traffic from OTTs consumed many resources from China Mobile's 2G network, even affecting its core service. Unstable voice signal and poor call quality became the visible representation of China Mobile's network being unable to bear the load.
Therefore, China Mobile's attitude towards OTTs has never been very "positive." As an operator, if China Mobile reduces WeChat's bandwidth or simply stops selling data to Tencent, it would not be illegal. This is like the sword of Damocles hanging over all OTT providers—despite the possibility being small, the threat always exists and could turn into various "malfunctions."
As internet analyst Hong Bo said, whatever China Mobile dislikes, the other two telecom operators must like.
This is a desperate struggle.
The three 3G licenses in China did not significantly help China Unicom and China Telecom change the monopolistic market structure in terms of market share and user numbers. Can OTT companies like Tencent help Unicom and Telecom change the operator landscape?
Probably not, because what China Mobile fears the most is not OTTs. OTTs may only reduce China Mobile's revenue and profit margin. In other words, after WeChat commercialization, it may take away a larger portion of profits. What China Mobile is most concerned about is "number portability," but currently, despite the pilot programs in Tianjin and Hainan, there are too many restrictions, almost rendering it meaningless.
If competition cannot make China Mobile lose users, then all the so-called anti-monopoly policies and products are "paper tigers."
Moreover, events are developing in favor of China Mobile: the State Council executive meeting has already clearly proposed issuing 4G licenses within the year. Entering the 4G era, mobile internet speed will be faster, and users' demand for high-quality mobile internet products will be more urgent.
This is why Guangdong Unicom announced loudly that currently, across the province's 21 cities, a network capable of transmitting 21Mb per second has been built, and in eight cities in the Pearl River Delta, a network capable of transmitting 42Mb per second has been constructed, making the Pearl River Delta the first city cluster in the country with a network speed reaching 42Mb/s.
However, building a 4G network requires astronomical investment. Currently, China Mobile is focusing on so-called "smart networks," which allocate reasonable network resources based on customer value and business value and provide corresponding billing methods for data pipelines.
What does this mean? In the future, China Mobile may charge Tencent higher bandwidth fees for WeChat, while also providing the best traffic resources to Tencent, ensuring the stability and experience of its users. However, smaller OTTs or partners may face "discrimination" due to fewer users—despite possibly paying lower bandwidth fees.
There is no doubt that this differential pricing completely opposes the principle of "network neutrality." The principle of "network neutrality" requires equal treatment of all internet content and access, preventing operators from controlling the priority of transmitted data for commercial interests, ensuring the "neutrality" of network data transmission.
The key issue with differential pricing is that it may lead to a "stronger gets stronger" outcome. New service providers and innovative companies may never be able to compete with giants, or may lose development opportunities—because they pay the same unit proportion cost but receive lower network quality than the giants. The entire market will change according to the Matthew effect, ultimately tilting more towards monopolistic giants.