China Mobile to challenge WeChat

In mid-March, media reports said that Chinese telecom carriers, led by China Mobile, are likely to start charging Tencent for hosting WeChat.

Telecom operators claimed that the WeChat service consumed too much traffic on their wireless networks but returned few benefits.

In addition, fewer people were using the voice and short messaging services provided by telecom operators, which further hampered the carriers' financial performance.

"We have seen the rising strategic position that Fetion holds in China Mobile's business range," said Xiang Ligang, a Beijing-based industry insider. But he expressed pessimism about Fetion's prospects due to Tencent's dominance in the sector.

Kevin Wang, director of China electronics research at IHS iSuppli, said it is good for China Mobile to bring in more powerful partners to its Fetion service.

"New partners may introduce fresh ideas in terms of product design, marketing and may help improve Fetion's user experiences," Wang said.