uploads///Smartphone Sales in China by OS Q

WeChat Makes Move to Challenge Apple’s App Business



WeChat’s Mini Program offers light apps for iPhone and Android

Apple (AAPL) has faced a stiff challenge in China’s handset market in recent quarters, leading to a drop in iPhone sales. The pressure on Apple in China is also spreading to the software sector. First, Alibaba’s (BABA) YunOS displaced Apple’s iOS as the second-most popular mobile operating system in China.

Now, Tencent’s WeChat has launched a package of apps that could carve a portion of the smartphone apps market from Apple and Alphabet (GOOGL), which have long dominated the Chinese apps market.

According to Kantar, iOS comprised 17.1% of smartphones sold in China in 3Q16 as opposed to Android’s 82.6%. Apple is fighting to defend its market share against Samsung (SSNLF), Microsoft (MSFT), Xiaomi, and Huawei.

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App Store sales up 90% in China

Apple (AAPL) recently stated that its app sales in China increased 90% in 2016 and 40% globally, with the company distributing $20 billion to iOS app developers. Selling apps is also a lucrative business for Apple, with the App Store generating more than $8 billion for the company in 2016, pushing its Services revenues up 22%.

With the launch of WeChat’s Mini Program, which is a suite of apps aimed at iOS and Android smartphones, analysts noted that Tencent appears interested in playing a leading role in the app business in the next decade.

WeChat, also a competitor of Facebook (FB), boasts ~846 million subscribers. Besides being a social messaging app, WeChat also supports digital payments and banking. WeChat users can also access news updates on the messaging app. While WeChat is careful not to tout its Mini Program as an iOS rival, its gains could come at the expense of iOS and Android.


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