How China’s Telecoms Can Monetize WeChat Use

With the rise of chat apps like WeChat, China’s telecoms are struggling to figure out how they’re going to make money as the apps slowly eliminate demand for many of the telecoms’ services. China’s government has already said it’s not coming to the rescue. So what’s a gigantic, state-owned telecom to do?

Well, here’s an idea, courtesy of the Philippines’s Globe Telecom: offer a “WeChat only” data package to current non-3G customers. (Globe is doing something similar with Viber in the Philippines; click the link above to find out more.)

Yes, it’s a short-term solution because sooner or later everyone is going to want full data. But right now, most Chinese mobile users dont have any kind of data package, and while they’re perhaps not ready to make the jump to full 3G coverage just yet, many might be willing to pay an additional fee for constant access to WeChat just in case they want to use a lot of multimedia (which transfers quite slowly over 2G networks). Such a service might even prove to be a good stepping stone in getting 2G users to covert to 3G (and ultimately 4G) more quickly.

Is it going to make up for the telecoms’ losses in texting and calling fees? Probably not. And there may well be some fatal flaw in this plan that hasn’t occurred to me, or to Globe Telecom. But I wonder if China’s telecoms will be watching this new partnership in the Philippines to see if something similar might work for them. If not, I think they should be. And either way, they need to be thinking about creative new ways to reform their business model, because the old one’s days are numbered.