Tencent news aggregator app Kuai Bao to cease operations next month, as China’s Big Tech firms cut noncore businesses
- Subscribers will not be able to log on and use Kuai Bao from July 18, when it will be removed from domestic online app stores
- Launched in 2015, Kuai Bao has failed to grow big enough to remain competitive against rivals led by market leader Jinri Toutiao
Tencent Holdings will terminate next month the operations of Kuai Bao, its news aggregator app, in a sign that even China’s most powerful and deep-pocketed Big Tech companies must cut noncore businesses amid ongoing regulatory pressure and the country’s flagging economic growth.
Subscribers will not be able to log on and use Kuai Bao from July 18, when it will be removed from domestic online app stores, according to a Kuai Bao statement last Friday. The existing Tencent News app will not be affected by that move, which was described as part of regular “business adjustments” by operator Tencent, which runs the world’s largest video gaming business by revenue and China’s biggest social media platform via super app WeChat.
Kuai Bao users are encouraged to take screenshots or save links to record their collection, historical data and the list of accounts they follow, according to the statement.
Similar to popular ByteDance-owned news aggregator app Jinri Toutiao, Kuai Bao provides users with algorithm-generated recommendations based on their profile, interests and browsing history. On Apple’s China App Store, Kuai Bao is described as having “interesting information that is personally made for you”.
Shenzhen-based Tencent did not immediately respond to a request for comment on Monday.
The decision on Kuai Bao’s fate came after Tencent restructured its news operations in May, changing the unit’s head and removing a handful of veteran editorial employees from their roles, according to an internal notice issued on May 23.
Closing Kuai Bao follows up on Tencent’s commitment to implement cost-control initiatives, while reviewing certain noncore operations, after reporting in May its slowest quarterly sales growth since the firm went public in 2004.
On the company’s underwhelming first-quarter financial results, Tencent founder, chairman and chief executive Pony Ma Huateng said in a statement at the time that rationalising certain noncore businesses “would enable us to achieve a more optimised cost structure going forward”.
Launched in 2015, Kuai Bao has failed to grow big enough to remain competitive against its rivals. In terms of daily active users, China’s online news information industry is led by ByteDance’s Jinri Toutiao, followed by Tencent News, Sina News and NetEase News, according to a report by research firm Questmobile in February 2021.
Within the Tencent universe, many of WeChat’s users choose to share news articles through the multipurpose app, rather than read them via the company’s news services.
Last year, Kuai Bao was among 129 apps ordered by China’s internet watchdog to halt privacy infringement and rectify their user data collection practices. Other news apps named and shamed by the Cyberspace Administration of China included Jinri Toutiao, Tencent News and Sohu News.
A major internet peer of Tencent has also been streamlining its operations amid regulatory scrutiny and the economic slowdown. TikTok owner ByteDance last week shut down a game development studio that it acquired three years ago, slashing more than a hundred jobs in a major setback for its quest to challenge Tencent in that market.
Over the past year, ByteDance has shut down most of its online tutoring operations. The Beijing-based tech unicorn then announced a sweeping corporate restructuring last November. In December, its social networking platform Feiliao was taken offline, months after the instant messenger was relaunched as a Clubhouse-like audio social app.
ByteDance then sold its loss-making securities unit Beijing Wenxing Online Technology Co in February, soon after closing the operations of fashion retail app Dmonstudio.
Author: Tracy Qu, SCMP