WeChat teams up with China Unicom

Tencent Holdings Ltd on Tuesday joined hands with China Unicom (Hong Kong) Ltd to launch the nation's first subscriber identification module card customized for WeChat, a popular instant messaging service developed by Tencent.

The partnership is also the first tie up between a telecommunications carrier and an Internet company.

The SIM card will provide online top-up services, more traffic volume and faster Internet access to WeChat users, said a statement from Tencent. It will be available from Aug 5.

China Unicom, the second largest telecom carrier in China, will give each subscriber 500 megabytes of free volume a month for services running on WeChat. The amount represents nearly 8,000 minutes of voice messages.

Both Tencent and China Unicom declined to predict the likely sales volume of the new SIM card.

Tencent executives did not rule out the possibility of WeChat teaming up with other carriers in the future.

The partnership is the first attempt to invite telecom carriers to the WeChat ecosystem. The company is looking for more opportunities to explore the market with carriers, said Zhang Xiaolong, senior vice-president of Tencent and head of the WeChat unit.

Late last year, Chinese telecom carriers blamed Tencent for creating a lot of Internet traffic while being unwilling to share any profit it made.

"Internet companies will push for an upgrade in the telecoms industry. Carriers should speed up the pace of teaming up with Internet companies," said Chen Jinqiao, an assistant general engineer at the China Academy of Telecommunication Research under the Ministry of Industry and Information Technology.

WeChat is the second-largest instant messaging service in China, behind QQ, a decade-old service that also belongs to Tencent, according to industry research company Analysys International.

WeChat users made up nearly one-third of the country's total mobile instant messaging population in the first quarter of this year, the consultancy added.

WeChat is becoming a major platform for Tencent to tap into the mobile Internet sector where analysts say the annual market size could exceed 80 billion yuan ($13 billion) this year.

The turnover of the nation's mobile Internet market exceeded 20 billion yuan in the first quarter of this year, a jump of 75.4 percent year-on-year, according to Beijing-based iResearch Consulting Group.

WeChat has been rapidly gaining user numbers since its release in January 2011. Its user population exceeded 300 million at the beginning of this year, with users outside the Chinese mainland hitting 70 million.

Tencent pledged earlier this month to add online and offline payment services to the next version of WeChat, which is likely to be launched in August.