Tencent Development Of Network Economics

Tencent company is currently the largest Internet company in China. After a few years of development Tencent company has become an Internet industry giant that has the largest group of users and annual income of nearly 200 million dollars, only relying on a small instant messaging software-QQ. Instant messaging is a typical network industry and demonstrated some comprehensive characteristics of the network economy. It is great different from the development of traditional industries. Tencent's development fully reflects the laws of the network economy including network externality, decreasing marginal cost of production, critical mass of market, increasing returns to scale and positive feedback, etc. This paper analyzes the development of Tencent company in order to explore its successful track and how to respond to the future challenges. Through the analysis I hope to provide some valuable reference to the related industries.Firstly, the paper proposes a new topic in the background, purpose and significance, and reviews the main results of theoretical studies related to network economics. Secondly, with using some economic theories, this paper analyzes the development process of Tencent company and summes up a general frame of the enterprise development in network economy. Moreover, this paper does a detailed analysis of the instant messaging market, and gets a SWOT matrix about Tencent company. The final part is the focus of this paper and offers some strategies and suggestions for the future development of Tencent company.The structure of this paper is arranged as follows:ChapterⅠis introduction. This section introduces the research background, purpose and significance, and does a general description of the theoretical studies related to network economics. At last, it points out the paper's research method, innovations and inadequate.ChapterⅡis the analysis for development frame of Tencent company. The primary content analyzes by the network economic theories, in view of Tencent company development track, how to achieve the rapid expansion of market share in the role of laws such as network effects, positive feedback, then summarizes a general network enterprise's development frame.ChapterⅢis the analysis for the instant messaging market conditions. It points out the present situation and the future trend of development about the instant messaging market, then has a comparison between Tencent company and its competitor, expounds the opportunities and challenges which the company will face.ChapterⅣis the analysis for development strategies of Tencent company in future. This chapter mainly proposes some suggestions for the future development strategies, and applies the game theory to discuss them. Finally, provides some strategies and measures.