TENCENT Inc, a Chinese portal and instant messaging service provider, has spent 100 million yuan (US$13 million) to set up its own research institute to develop patent technologies for future applications in wireless and data storage.

The institute, the first among Chinese Web companies, will help the Shenzhen-based firm build up its technology prowess and competitive edge and manage the rapidly growing user base, Tencent, China's largest instant messenger operator, said yesterday.

"We are focusing on some elementary but practical technologies. These technologies will not be for immediate application but will be used two or three years away," said Steve Zheng, Tencent's chief architecture officer and vice dean of the research institute.

The areas that Tencent's institute will focus on include multimedia such as online voice and video chat, network architecture, data storage and analysis, Chinese character processing and also wireless technologies for the content-rich third-generation mobile technology that will soon be launched in China.

The firm said it will pour more money in the research institute to initiate more projects and to "attract the top talents from other companies." No figure was given on how many projects or researchers they have now.

Other Chinese Web companies have departments carrying R&D functions but their research is mostly focused on product development to tackle the increasingly intense competition in the market.

Meanwhile, foreign Internet giants like Microsoft, Amazon and Google have set up their research institutes. Google just opened its Shanghai center in June, its second R&D facility on the mainland.