"With the increasing challenges brought by Internet companies that offer free instant messaging services, telecom companies need to take innovative actions to improve customer experience as well as establish new growth points for the future," Ji said.

He said that by launching money market products, telecom companies are building a gateway to tap into the mobile payment sector, which could become a new business model in the mobile Internet era.

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According to Ji, telecom carriers' top advantage in the era of the mobile Internet is that they have a vast number of clients who are increasingly dependent on mobile phones.

In an email to China Daily on Monday, China Telecom confirmed that more than 200,000 of its subscribers have become Tianyibao users and that the company aims to make the finance sector one of its key growth points in fulfilling the company's goal of "building a new China Telecom".

But Sandy Shen of consulting firm Gartner Inc was skeptical about the potential of online investment services launched by telecom giants. "The move can certainly help increase user loyalty. But I don't think it can become a new growth engine, because telecom companies do not have the Internet 'gene' to launch online finance products. They should focus on what they are good at and try to improve on that," she said.

However, telecom companies obviously figure there's no harm in expanding the portfolio of their services, especially given the increasing challenges brought on by Internet competitors.

Li Yue, chief executive officer of China Mobile, said in a recent interview that the company's short message business had decreased by 20 percent in the April due to the impact of products such as Tencent's WeChat.

Li said that China Mobile is looking to profit from its own mobile payment platform called "And Wallet", which has more than 20 million users.

"We are working with some financial institutions now. Our goal is to sell financial products on our mobile payment platform and earn commissions from our merchant partners," Li said in a Wall Street Journal article.