Chapter 73 Tencent's Way to Win and the Victory of the Matthew Effect

In fact, when Tencent became the leader in the domestic instant messaging market, OICQ had already won. "OICQ is very exclusive. As long as people use one, they will not use another product of the same kind. Because different OICQs are not compatible, the friends you make in this OICQ are not in another OICQ. You can’t find it here.” This leads to a result that the more and more OICQ users are, the more users there are, the higher their brand loyalty will be, and eventually the competitor’s user base will also be “swept away”.Ma Huateng himself pointed out the reason for the victory of OICQ (later renamed QQ).

In the initial stage of the development of instant messaging software, it is provided by free download, so the cost for users to abandon one kind of software and use another kind of software is very low.Therefore, it is not the transfer costs that have a lock-in effect on customers, but the value of using the network itself.Users face lock-in when the cost of moving technology from one brand to another is prohibitively high.Transfer costs and lock-in are very common in information products.The QQ number owned by each QQ user cannot be transplanted in other instant messaging networks, and the user's own contacts in the QQ network cannot be transferred to the new network.If the user switches to a new network, he faces losing this way of connecting with friends.Moreover, QQ has become the most popular instant messaging method on the Internet almost like telephones and mobile phones.From the perspective of a single user, the transfer cost does not seem to be very high.But if you look at the user as a whole, the transfer cost is very high.The total switching cost equals the cost borne by the customer plus the cost borne by the new supplier.

Assuming that we set the transfer cost for each user at 10 yuan, this price is not high, and the number of QQ users has exceeded 100 million in 2002, plus the equipment and labor costs required to provide services for these users , the number of transfer costs is very considerable.New suppliers must bear most of the switching costs if they want to enter the market.Therefore, the current monopoly position of QQ is very stable. Not only the huge acquisition cost will form a huge transfer cost, but even a single transfer cost may also form a huge entry barrier. The agglomeration effect formed by QQ is like two cities with different levels of prosperity. People are willing to go to the prosperous city. As a result, the prosperous city becomes more prosperous, while the poor city becomes even poorer, triggering the Matthew effect.Matthew Effect (Matthew Effect) refers to the better the good, the worse the bad, the more the more, the less the less, the name comes from a fable in the "Bible Matthew". In 1968, Robert K. Merton, a researcher on the history of science in the United States, proposed this term to summarize a social and psychological phenomenon: "compared with those unknown researchers, famous scientists usually get more prestige, Even if their achievements are similar. Likewise, on the same project, reputation is usually given to researchers who are already famous, for example, an award is almost always given to the most senior researcher, even if all the work was done by a graduate student He summed up the "Matthew Effect" as any individual, group or region, once it achieves success and progress in a certain aspect (such as money, reputation, status, etc.), it will have a cumulative advantage, and there will be more opportunities for greater success and progress.When explaining this point of view, he quoted two words from the Bible in the 25th chapter of the Gospel of Matthew: "To whoever has, more will be given, and he will be superfluous; and whoever has nothing, even what he has will be To take it."

In fact, Lao Tzu, a great ancient Chinese philosopher, said more comprehensively and thoroughly: "The way of heaven damages more than enough and makes up for what is not enough. The way of man is the opposite, and what is not enough to be damaged is more than enough to give." "Heaven" is a just and selfless nature. It will "repress the high ones and lift up the low ones; damage those who have excess and make up for those who are insufficient".People have selfish desires, so "the rich have distant relatives in the mountains", the Matthew effect is equivalent to "the loss is not enough to give more".In the Internet world where hundreds of millions of people have gathered, it is the extreme to lose enough and give more than enough.