China's WeChat seeks slice of Apple's app store with 'mini' function

BEIJING (Reuters) - China's largest mobile social media network WeChat is offering its 768 million users a function which allows them to by-pass app stores such as Apple's APPL.O.

The launch of "Xiaochengxu", which translates as "mini programs", challenges Apple APPL.O founder Steve Jobs' idea of an app store overseen by the maker of the iPhone, the device which marked its 10th anniversary on Monday.

App stores run by Apple and Google generate billions of dollars in revenue globally for them and China is a key target market as its users rely heavily on their phones for daily tasks ranging from grocery shopping to booking nail appointments.

WeChat's parent Tencent Holdings Ltd 0700.HK said in an e-mail on Tuesday that the function allows users to access merchants' services without having to download their apps.

These would in the past have been downloaded via app stores run by Apple or local companies such as 360 and Tencent’s own platform for Android apps.

Tencent said it had seen an “encouraging response” from merchants including Didi Chuxing,,,, JD as well as airlines, travel agencies and hotels.

Tencent is not the first company to develop an in-app downloading platform. Chinese internet giant Baidu Inc BIDU.O launched a similar platform in 2013 which it called "Light App".

“The quality of the content will decide if the user will adopt it massively and drop their current app store, which I don’t think they will do,” said Alexis Bonhomme, ‎co-founder of CuriosityChina, a Beijing-based marketing agency specializing in helping brands market on WeChat.

Earlier this month, Apple said app sales in China jumped 90 percent in 2016. In 2015, Reuters reported that Google GOOGL.O, whose services are banned in China, has been looking to relaunch its Google Play app store in the country.

Apple and Google did not respond to requests for comment on the launch of Xiaochengxu, which garnered a mixed response on social media from Chinese users.

“I don’t feel like it’s of much use,” one Weibo user wrote.

“I had hoped that it would allow me to delete some apps and free up some space in my antique 16GB phone...But it turns out that the WeChat app itself uses up the most memory!”

Since it launched in 2011, WeChat has become China’s most popular mobile social media platform. Its users can send text, audio and video message for free, as well as a combination of Facebook, Instagram and ApplePay functions within the app.

Reporting by Muyu Xu and Brenda Goh; Additional reporting by Cate Cadell; Editing by Alexander Smith