Skype changes partners in China

Updated: 2013-11-28 11:02

By China Daily (China Daily USA)

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Microsoft's Skype, the instant messaging and online voice-and-video-call service, has partnered with Guangming Founder (GMF) to operate its Skype business in China. The announcement came on Tuesday following the end of Skype's nine-year partnership with Tom Online, a Li Ka-shing-controlled media company.

"We wanted a new relationship for a better Skype,"Judd Harcombe, head of global market development at Skype,told China Daily. "The new strategic relationship is more suited to our users' needs. We thank Tom Online for their partnership and support over the years."

Guangming Founder, the new partner, is a joint venture between online news service and Founder Corporation, a local computing company. The collaboration is expected to combine Guangming's content background and Founder's broadband expertise, according to Skype. The partnership also features strong connections with China's university network.

"We're excited to partner with Skype in China," said Lu Xiangao, chairman of GMF and president of Guang Ming Digital. "Our new partnership allows us to use our resources more creatively and this will translate into providing consumers with technology that enhances communication throughout the region."

Tom declined to comment on Microsoft's plan to engage a new partner for Skype in China.

Microsoft officially acquired Skype for $8.5 billion in May 2011. Tom Online had been helping Skype access the Chinese mainland since it entered the market there in 2004.

"In China, Skype software is made available through a partnership to comply with established procedures to meet obligations under local laws," Harcombe said.

According to an announcement on Tom-Skype's website, Skype has currently surpassed 100 million users in China. Skype disputed TOM's numbers, saying only that it had "more than 300 million" users worldwide, without breaking the number down by country.

Skype has started migrating users to the latest Skype software, which will be available for Windows 8.1, Mac, older Windows platforms, Android and iOS, according to a Skype blog post. As for Microsoft's own Windows Phone - Skype says it's "coming soon".

"We are committed to making the transition seamless for our users and look forward to Tom Online's continued assistance,"Harcombe said, noting that users in China will receive guidance on how to upgrade.

Harcombe referred to "a deep and rich understanding of mobile technology"in describing the criteria Skype applied in choosing a new partner. "We wanted a partner who shared our excitement about communications, and our vision of the future," he said.

However, even in a new joint venture, Skype "would still find it tough to compete on the mainland against Tencent's popular platforms QQ and WeChat and those of other local players", said Ricky Lai, a research analyst.

Domestic telecommunications companies have also been either lowering their tariff plans to adjust, or aligning with local internet companies to innovate through new products and services. A significant example is Yixin, an instant messaging app co-launched by China Telecom, China's third largest mobile services provider, and NetEase, a local internet company.

"China has an exciting competitive landscape, which drives innovation. This in turn is good for users and is a wonderful opportunity for Skype," Harcombe said.

This week's announcement ended speculation about Microsoft mergingWindows LiveMessenger with Skype in China.

Wan Li contributed to this story.

(China Daily USA 11/28/2013 page1)