Tencent Falls After WeChat User Details Sought: Hong Kong Mover
Tencent Holdings Ltd. (700), China’s largest Internet company, fell the most in more than two months in Hong Kong trading after the company sought identification details for some users of its WeChat instant-message service.
Tencent fell 2.7 percent to HK$264.40 at the close, the biggest drop since Dec. 3. The Hang Seng Index fell 0.5 percent.
The company has sought ID card details from official account WeChat users who send feeds to followers, according to its website. China passed rules Dec. 28 requiring people to identify themselves when signing up for Internet and phone services as the government tightens control over the world’s largest population of Web users.
“When real-name registration requirements first came, people were quite worried that it would affect the popularity and user numbers,” said Ma Yuan, a Beijing-based analyst at Bocom International Holdings Co. “This should just be a short- term effect as user numbers have continued to go up in the past after similar news.”
Tencent has drawn more than 300 million users since introducing the WhatsApp-like social-network application about two years ago.
The Shenzhen-based company, which this month upgraded its system, now requires official account users who send feeds -- featuring news, opinions or coupons -- to submit copies of their identification cards, mobile phone numbers, addresses and other personal information during registration, according to the website.
Jerry Huang, a director of investor relations at Tencent, didn’t respond to a phone call and an e-mail requesting comment on the identification requirements.
Beijing’s local government first announced regulations for real-name registration on Dec. 16, 2011. Sina (SINA) Corp., operator of the Twitter-like Weibo microblog with more than 500 million accounts, plunged more than 11 percent that day before recovering as its service continued adding users.
Some of the official account users have a huge influence, said David Feng Dahui, chief technology officer of medical website DXY.com who has more than 40,000 followers on his official WeChat account.
“This was bound to happen,” Feng said. “Tencent would need to do this even if it’s just to make a gesture.”
Companies including Sina and Tencent have had time to consider the user-registration requirements since 2011, said Victoria Mio, a fund manager at Robeco Hong Kong Ltd., which holds shares of Tencent.
“Tencent has already been involved in active content monitoring to make sure they comply with Chinese laws and regulations,” Mio said. “For WeChat services, users already have to provide their mobile numbers -- which in effect satisfied the real-name registration rule, as mobile operators have their government IDs.”
To contact the editor responsible for this story: Michael Tighe at firstname.lastname@example.org