Technology

Tencent sues mobile phone manufacturers, "App Store" is the treasure of who

Tencent sued Vivo for restricting users from downloading "App Bao"; Tencent App Bao has sued all the major cell phone manufacturers, except Apple

Text/Wise Things

Two Shenzhen-based tech giants chose to go head-to-head in Jinan, with Tencent, the country's largest social networking application company, suing Vivo, the newest leader in the domestic cell phone market in 2021.

Technology media TechWeb was the first to report information about the lawsuit, which will take place on May 20 at the Jinan Central Court.

Over the past few years, the Jinan Central Court is becoming an important venue for litigating intellectual property cases in China and around the world. The court's official website self-examples of notable cases include two lawsuits involving Tencent in 2019 and 2020, one of which is also treated as a nationally notable case.

Tencent's cause of action is quite familiar, again because of the Tencent App Store.

Tencent sues mobile phone manufacturers, "App Store" is the treasure of who

In the TechWeb article, it is "reported" that Tencent App Store sued Vivo for taking advantage of the underlying cell phone to restrict users from normally downloading and installing Tencent App Store by inserting pop-up windows, text, buttons, setting risk detection, etc., and at the same time inducing users to download or install applications in Vivo App Store, so as to gain more traffic and commercial interests.

In the past few years, Tencent has sued all the big Android manufacturers such as Huawei and OPPO because of the download and installation problems of App Bao, and only owes Apple. How valuable is Tencent App Store to users that it is worth such a great deal of effort by Tencent?

Tencent loves to sue Android King

In 2016, Tencent App Store had sued Huawei for almost the same reason, when Tencent chose to proceed in Chongqing First Intermediate Court, which ruled in favor of Tencent's lawsuit in the first instance. 2017, Tencent sued Vivo and OPPO in Nanjing and Wuhan respectively because of App Store and Mobile Phone Manager.

Thus, it seems that the customary rule for Tencent to choose the target of prosecution is to choose to prosecute the cell phone market leader of the previous year.

Cell phone users can download the same applications from Tencent App Store and cell phone manufacturers' application stores, such as WeChat, Meituan, Drip, etc. The most direct difference is, as Tencent says, that the download platforms are different, and Meituan and Drip need to pay different objects for this search and download.

Directly speaking, Vivo and Tencent App Store can search and download for each user and get advertising revenue. Apple, as well as other Android majors, do the same. For Android phones, Internet advertising revenue, including such app pre-installation and app promotion, has become almost all of their advertising revenue sources.

The direct conflict of interest with cell phone majors is also an important reason for the market to look down on third-party application platforms such as Tencent App Store, PeaPod, Kuanan and TapTap.

Tencent App Store is not the only third-party application store platform that has been "restricted" by Vivo. A few months ago, there was an interesting test done by a consumer media that found that Vivo restricted the 4 major third-party application platforms mentioned above.

And Apple, Huawei, and OPPO restricted 3 of them to only allow Kuan to download from their respective app stores.

In overseas markets, the Android camp competes around the download platform, which also includes Google. Google's own GooglePlay, and Samsung, Vivo, OPPO and other Android giants manufacturers "official APP", between who is the authentic APP Store.

Many years ago, it was because Google took the initiative to abandon the Chinese market that it achieved a huge source of interest in the application stores of various domestic cell phone companies.

In the field of app stores, whether Tencent, Apple, Google or Huawei, Vivo, OPPO and Xiaomi, most of their choices have nothing to do with users or the so-called principle of fair competition in the market. This is a pure, a million profit stock business cake distribution only.

Win or lose, it only lies in the strength of each. It is also difficult to expect that the verdict of the Jinan Central Court and other judicial bodies can really solve the problem once and for all. We can only rely on new smart hardware entrepreneurs to create a new service to replace the existing App Store model for many years.

The app store model doesn't level the playing field

The competition between mobile giants such as Apple and Vivo, and Internet application platforms such as Google, Tencent, Meta, Epic and Spotify has been a hot topic in the market in recent years. In this regard, the interests are different and the positions are very different.

With the development of iPhone and Android majors' own App store, it is an indisputable fact that the living space and value of the third-party app store has shrunk, and the third-party app store has an insurmountable chasm in terms of privacy regulation and data security.

However, iOS and Android majors' own app store experience is not good either. Especially the Android majors, App Store, browser waterfall, has become a golden yoke on its way to pioneering innovation, the greater the benefit, the more Android majors will not give up this part of the revenue, on indulging in it.

For this one topic, the Wise Things team has witnessed several of these conflicts firsthand. From the user's perspective, the current app store model, whether it is Apple or Huawei, Vivo and other Android majors, as well as third-party app stores, the experience is not ideal.

The Wise Things team has discussed the future possibilities of this model extensively with some of the regulators and the heads of cell phone companies. Our view is that it is probably the best time to improve this model, whether it is the iPhone, or the Android majors.

In the field of automobiles, the British Economist has given a very graphic view that the future of the automobile industry is drive, no longer Selling Cars, and the direct understanding is that since all cars become self-driving, what users really need is a ride from A to B, not a variety of odd-shaped cars.

The Economist ignores the personal consumer goods nature of the car product itself, and its unique show-off properties, for now. However, the conclusion itself is worth considering.

Tencent sues mobile phone manufacturers, "App Store" is the treasure of who

Is there really a difference between the downloaded drops, Meituan, WeChat and King's Glory between iOS and Android app stores and third-party app platforms?

What users really need is taxi service, ticketing service, meal ordering service, courier service, not the software downloaded from the App Store or Vivo Store, and they don't care whether Drip pays Vivo or Tencent.

Service manufacturers do not want to pay Vivo, nor do they want to pay Tencent, but the situation is forced to pay. The cost of this channel expansion has become a barrier for DDT and Meituan to limit other innovative applications, at least new applications and small application manufacturers.

Since Tesla can integrate insurance and cab fleet business in the future, iPhone and Vivo can not directly integrate ticketing and food ordering? Is it possible to directly integrate news and integrate games?

Is there an "autopilot service" on the phone? Is the biggest use of cell phones really a photo machine?

In fact, the cell phone majors have already integrated part of the business, such as the payment business which is closest to the user's income, and the rigid demand business such as music which can be paid by the user's direct subscription. However, cell phone manufacturers currently do not bother, or at least no one is willing to really integrate applications and change them yet.

The key thing is that no Android vendor is really willing to give up this simple and brutal "bidding ranking" advertising revenue, to really have "subscribers", rather than looking for buyers.