Tencent Finally Taps into Online Education Market,with A Live Video Course Feature Added to QQ IM

We have been waiting for Tencent to release an online education service, for  the largest Internet company in China by market cap and user base cannot miss out on such a potential market.

The latest version of Tencent’s QQ IM added an Education Mode to the group video chatting service. So a teacher can give live courses to a group of students directly on QQ. Some tools are available for delivering classes such as Power Point support.

Interface of the Education Mode of QQ Group Video Chat

As it’s expected that online education will be a huge market in China, it’s not surprising to see any company to take part in. Alibaba launched a marketplace several months ago for teachers or educational organizations to sell live/recorded video courses, other educational materials or tickets to offline classes .

Baidu came up with a digital content marketplace where educational service providers can sell video courses and other educational digital content as well. Chuanke, an independent online course marketplace founded in late 2011, has received funding from Baidu. It is reported that Tencent approached the company earlier for a potential acquisition. There was a wave of investments and acquisitions in the first half of 2013.

But all those big names are latecomers. YY, the rich media communication service provider, launched YY Education in mid-2011. Since YY was operating an online platform for singing shows back then, it was easy to expand to any other sectors that connect performers(teachers) and audiences(students).

YY claims there are 800 educational organizations and 20,000 teachers on its platform that have provided over 100,000 courses. Monthly active users are 6 million.

Two years later, however, YY Education still doesn’t generate any meaningful revenue for its parent company — YY’s major revenue sources are virtual item sales on the singing show platform and online gaming. David Xuelin Li, CEO of YY, said on the latest earnings call, before they could make money from online courses provided by third-party course providers, what they needed to do was help teachers earn as much as they did from offline classes. So that more providers will move online and there’s a possibility to create a business model.

YY, somehow, managed to help a few on its platform to be successful enough to attract more to join. Xswlpx.com, an online computer skill training service offering courses on YY, generated 60 million yuan (a little less than $10 mn) in revenue in 2012 and raised some funding earlier this year.