Look East | Copycat to Copied | EMQQ
For anyone trying to predict what the Internet may look like in the
future, they may only have to look to an unlikely source – China.
Unlikely because, in the past, China has been accused of copying U.S. technology.
However, after years of being virtually walled-off from the rest of the world,
the Internet in China has evolved to the point where western companies are
looking to copy Chinese technology.
Copycat to Copied
Originally, much of the Chinese internet simply mirrored U.S. technology
according to a New York Times video.
However, the internet in China was virtually walled-off from the rest of
the world through a network of filters and blocks known as the “Great Firewall
of China.” It operated more like an intranet than the internet, according
to the New York Times. U.S. internet companies were shut out of China.
For virtually each U.S. Internet app, there was a Chinese
equivalent. However, as time passed, the technology of these Chinese
companies began evolving in a way that differed from the way that U.S. Internet
companies operated. In the U.S., many companies operate distinct apps
such as search, video, messaging, social media, etc.
China, however, saw the creation of superapps, or apps that combined many of
these functionalities into one larger app.
WeChat - The SuperApp
WeChat is a prime example of a superapp developed in the relative
isolation of the Chinese internet. WeChat, a unit of Tencent Holdings
(TCEHY) began as an instant messaging app but has evolved into much more.
Described as the Swiss Army Knife for the internet, WeChat can do just about
everything online. It is underpinned by its popular WeChat Pay payments
platform which supports additional functionalities such as allowing users to
shop, pay, order food, buy movie tickets and make restaurant reservations and
doctor’s appointments, hail rides, find out how crowded their favourite
restaurant is, and much more without leaving the platform. WeChat has
even moved into education and healthcare.
It's All About the Data
According to the New York Times, WeChat has some 1.1 billion active
monthly users (MAUs). With one app having some many functions and users,
WeChat has the ability to collect a staggering amount of data.
For potential advertisers, this is a real treasure trove.
Looking to China
Western companies are now looking to copy some of the functionalities of
Chinese Internet companies. A Wall Street Journal cited Facebook founder
Mark Zuckerberg as saying that he sees the future of the company in encrypted
messaging, payments and other services – strikingly similar to WeChat. The amount of data that
companies such as Facebook would be able to collect would be a bonanza for the
company and for potential advertisers.
Potential Impediments to U.S. Adoption
Unlike most U.S. models, WeChat does not rely on advertising to make
money. Rather, its payment platform drives its financial model, according
to the New York Times. WeChat users are not bombarded by the same volume
of advertising as Facebook users.
Internet users, already concerned about privacy, may have greater
reservations with companies having greater ability to track their every move
and having access to such a vast amount of data. There is no pretence or
expectation of privacy in China.
Chinese companies were allowed to develop while shielded from
competition from the outside world. However, that would not be the case
for U.S. companies where competition is far more intense.
Online payments have been widely accepted as a form of payment in China
compared to the U.S. where credit cards are more popular.
Western companies are looking at Chinese Internet
companies as they look to roll out the next generation of products.
Superapps, such as China’s WeChat, are providing the roadmap for companies such
as Facebook who are developing functionalities that are similar to their
Chinese counterparts. While impediments exist to full-scale adoption of
Chinese business models, it is quite likely the internet of tomorrow may look
different than that of today. And it may look more eastern than it
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