Chinese app developer Cheetah Mobile throws down gauntlet to mobile advertising platforms

China’s Cheetah Mobile, known for its popular utility apps like Clean Master and Battery Doctor, is looking to diversify its portfolio and dominate a new market after its recent acquisition of French mobile advertising firm MobPartner.

“Our target is to become one of the top three mobile advertising platforms in the world,” said Fu Sheng, CEO of Cheetah Mobile, at a two-day conference for tech start-ups in Hong Kong late last week.

The grand ambitions of China’s largest mobile utility app developer do not appear to have been thwarted by its ongoing legal battle with chief domestic rival Apus Group, which it is suing for defamation.

Following the US$58 million acquisition of MobPartner in March, Cheetah Mobile launched its global advertising platform, dubbed the Cheetah Ad Platform, in June to help brands engage with audiences using targeted advertising.

Cheetah Mobile went on to invest US$24 million in social media advertising software provider Nanigans in April. The company also bought Hong Kong-based mobile advertising company Zoom Interactive for US$30 million in June.

“Our mobile revenue increased five times in the last year,” said Fu. “Our strategy is to build a huge user base, then use big data [to better cater to users] and build our mobile advertisement platform.”

Cheetah Mobile’s popular junk file-removal app Clean Master currently ranks fifth among global downloads in all categories, according to analytics company App Annie.

The company has contracts with 70 smartphone manufacturers and carriers to have it installed as a default app.

Facebook Messenger is the world’s most downloaded app, followed by WhatsApp, Facebook and Instagram. 

Cheetah has amassed over 500 million users worldwide, 70 per cent of whom come from outside China, according to its corporate profile.

It sued Apus in June after the company planted a notice in its Apus Launcher app alleging that Cheetah’s Clean Master app was “stealing” their personal data.

“After we sued them, they removed it,” Fu told the South China Morning Post. 

“But the damage has already been done, so we will pursue the appropriate legal action.”

Yet Cheetah is no newcomer to controversy. 

Apus said in July it was taking legal action in China against the company for unfair competition. It claimed that two of Cheetah Mobile's utility apps were misleading users into uninstalling the Apus launcher app by portraying it as more resource-consuming and battery draining than it in fact is.

In July 2014, Google removed Clean Master from its rankings list due to a violation of Google Play’s policies. The company was accused of encouraging users to uninstall competitors’ browsers and replacing them with its own. 

Analysts blasted Cheetah for failing to inform US investors that the app was struck from the list, therefore keeping them in the dark as its downloads outside China plunged 88 per cent. The app was reinstated in August.

The company went public on the New York Stock Exchange in May 2014. Its stock price is now nearly double its original trading price of US$14.

Fu attributes the success of the three-year-old company to its global focus, free-to-use business model and attention to user experience.