The counterattack from China Mobile against over-the-top (OTT) service providers like Tencent is finally on.

One year after announcing the introduction of a new integrated communication technology to offer instant messaging (IM) services, the mainland's largest telecom carrier has set a target of securing a user base of 16 million by the end of 2015.

Known as a platform that enables delivery of communications including IM, and live video and file sharing across devices on different networks, aside from the traditional voice and Short Massage Services (SMS) telecom carriers generally provide, its newly developed Rich Communication Services (RCS) technology will allow China Mobile to offer customers the combined functions of other IM applications such as WeChat and Skype.

With sliding profits from shrinking voice and Short Massage Services businesses, China Mobile is taking a bold step to offer instant messaging services to contend with mainland's most popular messaging platform WeChat. Brent Lewin / Bloomberg

It means once an app based on RCS technology is downloaded onto a handset, China Mobile users would instantly be able to message or video chat with others whose smartphones are also equipped with the same technology, through a viable wireless network.

Fang Hui, a vice-president in cloud computing and IT product operation with ZTE Corporation, said RCS is the trump card that China Mobile holds to counter other OTT players in the country as the services will enable the telecom carrier to control entry to mobile Internet. ZTE won a bid to construct the first-phase RCS network for China Mobile in October last year, following the mainland carrier's first-quarter announcement promising to deliver enriched experience in voice and SMS businesses. The project has been completed and internal tests conducted by 550,000 China Mobile staffs indicate a positive feedback for the system.

However, though China Mobile has only set a target of 16 million active RCS users by the end of 2015, the total network capacity that ZTE has built could cover 100 million users, according to Fang.

China Mobile's confidence in the technology is backed by its fast development of fourth-generation (4G) telecom network on the mainland.

Earlier this month, the telco announced that it has so far accumulated over 100 million domestic 4G users since the launch of the network in December 2013, with 4G international roaming services also stretching out into as many as 71 countries and economies.

Sha Yuejia, a vice-president at China Mobile, said 4G development on the mainland exceeded expectations in the past year as it took the company just a year to build the largest 4G network in the world.

But China Mobile's ambitions stretch far beyond a passive wait for users to download the new technology.

Rather, its upcoming RCS-based social networking platform will become a native embedded solution on all of its customized mobile handsets, turning such functions currently offered by other apps into inbuilt basic features in these customized smartphones.

With more than 800 million users, China Mobile is the largest carrier among the Big Three wireless service providers in the country, ahead of China Unicom and China Telecom. But it has suffered painfully due to the popularity of WeChat, as the rich communicating functions of the Tencent messaging app have been eroding China Mobile's voice and SMS revenues.

Net profit for the nine months ended Sept 30 dropped by 9.7 percent, weighed down by an increasingly saturated telecommunications market and competition from rival carriers, a China Mobile stock filing in October showed.

The company blamed the profit slide on shrinking voice and SMS businesses, which contracted by 0.3 percent and 20.2 percent, respectively, in terms of usage amount.

On the other hand, the active user base of Tencent's WeChat had expanded to nearly 500 million at the last count.

China Mobile has set a target to sell 250 million handsets this year, of which 200 million will be smartphones supporting 4G network, and all will be equipped with RCS functions, according to ZTE's Fang.

Smartphone brands, including ZTE, Lenovo and Coolpad, have all announced they will cooperate with China Mobile on the new functions this year.

Fang added that China Mobile will likely carry on construction of the second-phase RCS network in the second half of this year, on a scale expected to be even bigger than the first stage.

litao@chinadailyhk.com

(HK Edition 03/12/2015 page9)