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在线翻译:
szdaily -> In depth -> 
Internet giants see taxi apps as driver for growth
    2014-02-25  08:53    Shenzhen Daily

    Liu Minxia

    mllmx@msn.com

    CONSUMERS who are pleased with themselves for saving money amid a price war between popular taxi-hailing mobile applications Kuaidi Dache and Didi Dache are being lured into a new payment habit that will help shore up the players’ future dominance in the burgeoning Internet finance market.

    The cash-burning war, which has cost Didi Dache 400 million yuan (US$65 million) in subsidies in the previous four weeks, and Kuaidi Dache roughly 10 million yuan every day, is a competition over the lucrative mobile payment market fought between Internet giant Tencent Technologies and e-commerce leader Alibaba Group, which financially backs Didi Dache and Kuaidi Dache, respectively, said Liu Xiafeng, an analyst with Renren Money, a Shenzhen-based Internet financial services company, yesterday.

    “They are trying to get as many users as possible comfortable using mobile payments on a regular daily basis,” said Mark Natkin of Marbridge Consulting.

    Mobile Internet payments in China nearly quadrupled between the first half of 2012 and 2013 to 130 billion yuan, according to research consultant iResearch.

    “Once formed, consumption habits are formidable,” said Liu. “Take Tencent’s popular instant messaging mobile app Wechat for an example. People have become used to it and all the followers, including China Telecom’s YiChat and Alibaba’s Laiwang, are largely neglected even they’re also well-designed.”

    Furthermore, Didi Dache is linked to WeChat, which offers its roughly 300 million users an array of financial services including Licaitong, while Kuaidi Dache is built into Alibaba’s leading payment management application Alipay.

    “Tencent is also using the chance to bring about an upswing to its long-pressed Licaitong service, an online investment tool that has come into being on the heels of Alipay’s Yu’ebao,” said Liu.

    Yu’ebao, China’s first online money market fund launched in June, has gained millions of investors and seen a lot of copycats among both Internet companies and traditional financial services institutions.

    Alibaba, which is facing slowing growth in its core e-commerce business, is hoping that its PayPal-like Alipay unit could become a new driver of growth. But it is far from clear that Alibaba will be able to dominate mobile payments in the same way as it has done in e-commerce, although it has a market-leading 50 percent share of online payments in China, against Tencent’s 20 percent.

    “Both Tencent and Alibaba understand that it’s a now-or-never opportunity,” said Liu. “If they don’t burn money now, they won’t have a single chance to dominate the market even if they spend 10 times more in the future.”

    Both Tencent and Alibaba have expressed their determination to win the war. “We’re determined to offer subsidies through to the end, to let more taxi passengers and drivers get to know the convenience of using the app,” Lu Jun, an Alipay spokesman, told Shenzhen Daily on Friday, echoing Kuaidi Dache’s vice president Li Min, who said the company is not lacking in cash. Didi Dache vice president Zhang Jing also said they are aiming to gain more loyal users although the new round of rebate hikes will cost the firm about 1 billion yuan.

    Analysts, however, agreed the frenzied cash-lavishing war may not last long, due to regulatory and financial constrains as well as loopholes being taken advantage of by app users.

    Didi Dache has won cash injections totaling more than US$100 million, but it has squandered 400 million yuan on taxi subsidies in the previous round of the price war, and the remaining funds are barely enough for another month of rebates, data show. Research consultant iResearch also predicted that the price war between Tencent and Alibaba may not last another month.

    Meanwhile, media reports said some taxi drivers and passengers are taking advantage of the price war to earn money by using the two apps for one ride, arousing regulatory attention.

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