Tencent Q4 net profit nearly doubles to 20.8 bn yuan, beats estimates

Chinese internet giant Tencent Holdings Ltd posted on Wednesday a 98 percent rise in quarterly net profit, beating expectations as it deepens monetisation of the growing traffic on its social networks.

Net profit for the three months ended December 31 rose to 20.8 billion yuan ($3.29 billion), China's largest social media and gaming company said in a filing to the Hong Kong Stock Exchange.

That was above an average estimate of 16.90 billion yuan from 9 analysts surveyed by Thomson Reuters.

Revenue rose 51 percent to 66.39 billion yuan, compared with analysts' average estimate of 69.5 billion yuan. Monthly active users of the social media mobile app WeChat exceeded 1 billion after the Chinese New Year in February, up from 980 million at the end of September.

Net profit for the full 2017 year rose 74 percent to 71.51 billion yuan. The company declared a final dividend of HK$0.88 per share.

China's Tencent acquires 12% stake in Snap as shares plunge

Snap Inc said on Wednesday that Chinese tech and media investment firm Tencent Holdings Ltd had taken a 12 per cent stake in the company, a day after the owner of disappearing-messaging app Snapchat was punished by Wall Street for disappointing quarterly results.

Snap's shares fell 16 per cent to $12.67, well below their $17 initial public offering price in March, as investors fretted about Snap's slowing user growth in the latest quarter and viewed Tencent's move as an investment rather than the precursor to a merger.

"(Tencent) buys all sorts of minority investments, and I don't think we can extrapolate that this means they intend to take over the company," said Wedbush Securities analyst Michael Pachter.

Snap said it had only received the details of the stake from Tencent this month. Tencent's 145.8 million class A common shares of Snap, worth about $1.7 billion at Wednesday's price, give the Chinese company no voting rights.

Tencent president Martin Lau told Snap his firm is "excited" to deepen its relationship with the firm, Snap said in a regulatory filing. A Snap spokesman declined to comment further.

The Chinese tech company, which owns mobile chat service WeChat, has bought stakes in several companies over the past few years, including electric car maker Tesla Inc and ride services company Lyft Inc. In 2013 it invested in Snap through an affiliate.
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Tencent, Alibaba now dominate online food delivery space in China

Last month, Baidu sold its O2O food delivery service, Baidu Waimai, to Ele.me. This means that now, the Alibaba-backed Ele.me and Tencent-backed Meituan dominate the space.

This deal speaks volumes about the state of Chinese internet in 2017. Here are the three big trends:

Convergence is continuing

China’s internet giants- Alibaba, Tencent, and Baidu- are continuing to move into each others’ spaces. This is a big change from a few years ago when Tencent mostly stayed in gaming and messaging, Alibaba in e-commerce, and Baidu in search.

As Alibaba and Tencent now dwarf Baidu in market cap, the latter’s exit from food delivery implies that it’s tired of being caught between much larger competitors.

China-specific solutions weigh more

The Chinese O2O food delivery trend created an army of delivery people on scooters. They race around streets, alleys, parks, and sidewalks and congregate outside storefronts and subways.

What all of these have in common is that they all offer China-specific solutions.

The Chinese market is so big that creative solutions in small niches can mean big businesses.
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Netizen report: China has a new cybersecurity law

It has been only two weeks since China's new Cybersecurity Law came into force, but its effects are already being felt across social and news media networks.

On June 1, public social media accounts were officially barred from writing or republishing news reports without a permit, as stipulated by the Provisions for the Administration of Internet News Information Service.

On June 7, the Cyberspace Administration of China (CAC), the country’s online censorship agency, shut down at least 60 major celebrity news accounts across Weibo, Tencent, NetEase and Baidu. The CAC said the move is intended to “proactively promote socialist core values and develop a healthy and positive atmosphere” by curbing coverage of sensationalist celebrity scandals.

This marks a shift in focus for the CAC. In the past, many believed that the driving force of censorship was mainly political and that people could enjoy “online freedom” as long as they refrained from commenting on current affairs. The crackdown on entertainment news indicates that ideological struggle is not only directed against foreign enemies, but also at thoughts and activities seen to go against “socialist core values.”

The new cybersecurity law has also become a point of contention for foreign technology companies operating in China. Among other things, it requires that companies store their data in China and that users register with their real names to use messaging services. Officials have yet to convey much information about how the law will be implemented, but these provisions do not bode well for the protection of digital rights.

Online censorship keeps rising in Egypt

Media rights advocates and independent news outlets in Egypt are reporting that web censorship has continued to rise since authorities officially banned 21 news websites in late May, alleging that they were “supporting terrorism and spreading lies.” These websites include the Arabic edition of Huffington Post, Al Jazeera, and local independent news site Mada Masr, among others. This past week, the Association for Freedom of Thought in Egypt reported that five virtual private network sites (which help circumvent censorship) were blocked, along with blogging platform Medium, and multiple Turkish and Iranian media outlets. On June 11, the group reported that the total number of sites currently blocked in the country had risen to 64.
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