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Tencent aims to be China’s Facebook, Twitter and Google

encent Holdings Ltd is the third largest internet firms in the world, headquartered in China and planning to diversify its services so that it can become Facebook, Twitter and Google all in one.

The future is promising for Tencent, despite de world economic crisis. The company has been estimated at 50 billion dollars on the stock market, four times than the price it was valued at two years ago. It started as an online gaming producer, but over time its aim followed a more diversified path: e-commerce, social networking and search engine. The new services put Tencent in the position of a gambler, risking to be swallowed up by strong competitors like Baidu Inc, SINA Corp and Alibaba.com.

Analysts like Hover Xiao, from the technology research firm IDC, believe that the company should not waste its forces on so many sectors, for it will not be able to sustain its economical power gained so far. “Tencent needs to look for other gold mines to counter slowing online gaming growth. Otherwise, they won’t be able to maintain the strong growth they’ve had over the past few years” Xiao said.

So far, Tencent, who’s mascots are two cute penguins wrapped around in scarves, has been relying on the online game business, which brings the company 60 percents of the revenues. In 2010 it summed up the equivalent of 3 billion dollars. This June, the company opened the Q+ platform, an open system meant to attract foreign software developers. At this point, Tencent’s strongest rivals are Facebook and Apple.

Tencent has other developing plans as well. It is now seeking to enter with a boom on the Chinese e-commerce market. It also plans on launching into the search engine sector, aiming at the number two spot in the following years. At this point, the company ranks third in the wireless search engine sector, after Baidu and Easou.com.

Half of the company’s staff works now in research and development – near 6,000 employees – and 10 percent of the revenue goes to the research sector.

China internet users forced to choose in software row

Hundreds of millions of internet users must choose between China’s top internet chat programme and its best selling internet security tool.

They have been told they cannot have both, as a dispute between the two internet giants has escalated.The dispute has led to allegations of theft, involvement with pornography sites and even “doing evil”.China has the world’s biggest – and fastest growing – online population with more than 400m users.

Tencent’s statement

Tencent is making users choose between running its QQ messaging platform, China’s largest with more than 600 million users or Qihoo 360’s antivirus software.”We have just made a very difficult decision … We have decided that computers running 360 software will not be able to run QQ software,” the firm said in a statement.

Tencent, China’s largest Internet firm by market capitalization, and Qihoo 360, China’s top provider of free security software, have been involved in a tussle for more than a month accusing each other of bad business practices, such as spying, hacking and leaking users’ privacy.

Tencent shares fell 3.7 percent by the midsession break, underperforming the broader Hang Seng Index which was up 1.3 percent.

QQ or 360

In one corner of the ring is a company called Tencent. It runs China’s most popular instant messaging service, called QQ.It says it runs more than one billion QQ accounts.In the other is Qihoo 360, the maker of an antivirus tool that controls 70% of the market with software it gives away for free.The row started when Tencent encouraged users to download its own antivirus product.

Qihoo 360 responded by accusing Tencent of stealing users’ personal information.Then it got worse. There were allegations that Qihoo 360 was advertising on porn sites, that its software maliciously interfered with users’ QQ accounts.And other companies joined in to denounce the firm. Qihoo 360 responded by accusing them of “jointly doing evil”.Now the gloves are off. Tencent says it is withdrawing its QQ instant messaging service from 300m users of its rival’s antivirus software.

Qihoo has responded by advising its customers to switch to other chat providers like MSN.It says Tencent’s move could be disastrous, leading to an unprecedented outbreak of software viruses in China.Not surprisingly many internet users are furious, complaining the fight between two commercial rivals is now hurting them.

So now everyone is waiting to see what the users will do. Will they dump their antivirus software or their instant messaging account or both?