Weixin users are young and educated. For example, 74% of the users are between 20 and 30 years old. University students and white-collar workers constitute over 90% of its user base. According to Tencent, it will begin testing various business models. Entertainment, such as mobile game and e-commerce, may become the viable monetization channels for Weixin. That said, the company does not expect to generate substantial revenue from Weixin in the near term.
Rivals such as Line and KakaoTalk started monetization in 2012. For example, Line generated ~US$44mn sales in 4Q12 (up 3x QoQ), with sticker (e.g., Emoji) and game sales contributing equally. Line also generated marginal advertising revenue from ~40 corporate advertisers. Each advertiser has to pay an initial fee of ~US$28,000 and a monthly fee of ~US$21,000 to Line.
KakaoTalk introduced its game services, Kakao Games, which has grown into a popular mobile game distribution platform in Korea. Shortly after its launch in August 2012, Kakao Games saw 82mn game downloads from 23mn unique users. In October 2012, Kakao Games generated US$35mn in sales, up notably from US$5mn in August. Tencent acquired a ~13% stake in KakaoTalk in 2012.