Tenpay - Riding the QQ Freight Train

Tenpay is the exclusive online payments provider of Tencent, one of the largest and most powerful internet companies in China today. Tencent's service reach includes instant messaging, gaming, blogs, and various wireless value-added services branded under the "QQ" name; also included in the Group’s umbrella of companies is an eBay-like online marketplace called Paipai. Tenpay provides an online payment platform for all of these services. With over over 26 million users, Tenpay easily ranks them among the leading third-party payment companies in China.

Key Findings

• Tenpay is an integral part of Tencent and its main purpose is to facilitate online payments for the Tencent Group.
• As a stand-alone company, Tenpay has yet to prove it has a viable business model, as revenues and profitability are being sacrificed for the success of Tencent and its subsidiaries.
• Tenpay has a fast-growing registered user base currently standing at 26 million, and has direct and exclusive access to serve the payment needs of Tencent’s 300 million active users.

Figures

Figure 1: Credit Cards Issued in China and in the US (M)  
Figure 2: Internet Users in China, 2001-2006 (M)  
Figure 3: Mobile Subscribers in China, 2002-2010F (M)  
Figure 4: China Government Groups Involved in Third-Party Payment Regulation  
Figure 5: The evolution of Tencent's services  
Figure 6: Tencent Organizational Structure 
Figure 7: Tenpay’s Operation Model  
Figure 8: Tenpay Transaction Volume Breakdown (%)  
Figure 9: QQ Registered Users, 2006- 3Q 2007, (M)  
Figure 10: Tenpay Registered Users, 2006- 3Q 2007, (M)  
Figure 11: Tenpay Users as a Percentage of QQ Active Users, 2006-2007 (%)  
Figure 12: Q Coin Purchase Breakdown (%)  
Figure 13: QQ Games and Services Paid for by Q Coins  
Figure 14: Tenpay's Co-branded Services  
Figure 15: Tenpay Logo 
Figure 16: Tenpay Bank Partners
Figure 17: Tenpay Merchant Partners

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