Tencent: Changing medical field requires not merely “connection”

The "magic" of Tencent seems to be lost in the medical field. Over 3 years after swaying back and forth in this field like many entrepreneurs, Pony Ma, the commander of the "Tencent Empire" worth RMB 2 trillion, also admitted that the medical field was the hardest one among all "Internet+" fields.

The Chinese medical market is undergoing unprecedented changes, and no one denies the huge opportunities that lie therein. Alibaba led by Jack Ma acquired CITIC 21CN for HKD 1.327 billion at the beginning of 2014, and thereafter renamed it AliHealth to move strongly into the medical industry. As a strong competitor of Pony Ma and Tencent in the Chinese market, Jack Ma has more "venturesome" thoughts to some degree.

In contrast, Tencent and Pony Ma himself have been very cautious about the medical field: there has been no special company or business unit and no high-profile heavy investment of Tencent in the medical field and its exploratory actions seem to be scattered. Tencent has also underestimated the difficulty in reforming the traditional medical system in the early days, like most entrepreneurs in the internet medical field.

Pony Ma later made a summary for those efforts: Connect everything.

The change speed of the medical service system has clearly fallen behind the expectations of internet giants. The public hospitals still keep a firm grip on the medical market of China, possess most of the quality medical resources and serve nearly 90% patients, after 10-year medical reform and de-administration, but they are not highly enthusiastic about the internet.

Unlike Baidu turned around to specialize in artificial intelligence, there are signs that Tencent is trying to combine and integrate points that have been distributed for years. As can be expected, Tencent will continue to increase the investment and layout in internet medical field. What will be the changes brought by the powering up "Tencent + Medical"?

Medical insurance mobile payment accelerated

The long coveted but out-of-reach medical insurance mobile payment has become a field where Tencent can show its skills recently.

According to data from Tencent, the medical insurance payment with WeChat has entered 13 hospitals in Shenzhen from the pilot work started in Shenzhen in September last year to February this year, with 21 cities in 11 provinces including Sichuan, Henan, Heilongjiang and Shaanxi, etc. to gradually achieve medical insurance payment with WeChat; and the application scenarios of the medical insurance payment with WeChat also have expanded from hospitals to pharmacies: citizens in Nanning City, Guangxi can buy medicine through medical insurance payment with WeChat in 35 pharmacies, and this will be expanded to over 4,000 pharmacies in Guangxi in the future.

China has a complex medical security system. There are still differences in administrative departments, overall planning levels, financing methods and compensation levels, etc., although China has started to promote the medical insurance integration. The technical neutrality in connection channels that has been strictly implemented makes it possible for Tencent to transcend departmental boundaries and integration progress.

The medical insurance mobile payment has been accepted by more and more people as a future development trend. Pharmaceutical product and diagnosis and treatment services, etc. have preliminarily gone on line. And after the internet hospitals attract the great interest of the government, there will be more and more people calling for inclusion of online medical services in the reimbursement scope of medical insurance. Once this becomes reality, the medical insurance mobile payment will happen automatically. And you cannot image how bright the future will be for Tencent considering its huge user base!

However, how deeply will Tencent go in the medical field?

Staying away or deeply involved?

As a platform IT company, Tencent has been trying to "staying away" the medical industry.

In China, the role of the medical institutions is being reconfirmed, patients’ habits of seeking medical advice need reshaping, and the rise of commercial insurances is likely to impact the pattern of basic medical insurance dominance. Such "connection" of internet medical field difficult to work is because the inverted pyramid allocation of existing medical resources results in the internet medical field to have no strong basic medical resources as the support, but not because of the hindrance of online diagnosis, plus it is very difficult to form clear industrial division in the transition period.

Of course, Tencent can continue to stick to "connect everything" and control own involvement in medical field, medical insurance and pharmaceutical field to be on the technical service level, which means that development of Tencent in the medical field will greatly depend on the transition process of the entire industry, or it can choose to become a player deeply involved in the medical industry, which is clearly a bigger challenge for Tencent.

Will Tencent participate in construction of offline medical institutions? It is too early to say no. Tencent has recently invested and controlled a small medical company of which one main business is to provide clinic service. Many people have been fascinated by the future clinic Forward of the U.S. not long ago, and will such clinic first come from Tencent in China?

Perhaps the most difficult thing for the powerful Tencent is to grasp the discretion.