Shanda (SNDA) is going to compete with Tencent (0700) and Netease (NTES) with a newly developed instant message communications software temporarily called "Quan Quan" (Circle).

Compared to Tencent and Netease, Shanda has been in a less favorable market position due to a lack of portal website support. Tencent has its own QQ instant message software and Netease also utilizes a similar platform.

But local media reports that Tencent's CEO Ma Huateng claims QQ's only competition comes from Microsoft's (MSFT) MSN Messenger and he is not worried about other local Chinese competitors like Shanda. MSN, itself, last week launched MSN China, an integrated portal of services to complement the Messenger software.