Internet company Tencent Holdings Ltd. (Tencent) has just edged past telecoms giant China Mobile Ltd. to become the most valuable company in China.
According to Bloomberg, Tencent is also the 10th most valuable company in the world.
Tencent’s market cap is valued at $236,6 Billion as of this morning.
Tencent now stands with tech giants Apple (1st), Alphabet/Google (2nd), Microsoft (3rd) and Amazon (5th) in the top 10 most valuable companies in the world.
Tencent is best known for online gaming, instant messaging and adveritising.
Tencent edging out China Mobile is of significance in China because:
- Tencent is a private company whilst China Mobile is state owned/funded
- Tencent is a Over The Top (OTT) content provider while China Mobile is a Mobile Network Operator.
Over The Top content is the delivery of audio, video, and other media over the Internet without the involvement of a multiple-system operator in the control or distribution of the content.
The news also represents a growing reality and shift of the world’s economy.
Whilst traditional industries are struggling and retrenching workers, younger more robust internet based companies are thriving and making significant steps in finance and media.
Consumption driven economies are fueling the surge in internet based business.
We recently wrote an article explaining how a new middle class in Africa is driving demand for mobile internet as they have more dispoable income resulting in higher average spending per day.
This demand for mobile internet is high in consumption driven econonomies as more people need access to the internet.
Nowadays, people seem to only view their mobile operators as a means to access the internet and slowly, demand for operators traditional services of voice and SMS are fading away.
Testament to this, we wrote about how mobile internet revenue is increasing for Zimbabwe’s largest network operator Econet and in the same period their voice revenue and average revenue per user declined.
Also of interest is that NASPERS, the South African tech giant and largest company in Africa, owns a significant shareholding in Tencent.
