Counterpoint Technology Market Research has written previously and predicted on how the messaging apps are revolutionizing the tech industry. i.e. how Wechat has transformed into a huge m-commerce platform and even leapfrogging Amazon in many aspects as well as Twitter going m-commerce. Also predictions were made and reasoned how these emerging mobile-centric platforms can acquire/partner with content companies or content driving engines to grow further as major platforms where user can spend their digital lives. It is foolish to ignore the growing scale of these platforms which are growing in capabilities and are becoming ecosystems in themselves.
If we look at carefully these platforms are beginning to look identical and at some point in future will become a commonplace. However, the differences that will make them standout or survive in long run is their business model and their reach in terms of capabilities and user base.
These ambitious app based platforms are expanding their reach across multiple areas attracting users to spend more time communicating, shopping as well as consuming content. These are creating greater amount of stickiness and using their horizontal business model to scale and with presence on the major platforms from iOS to Android to Windows to target the complete pie of smart devices users. These messaging apps (sorry platforms!) are surely major threat to each other but more so to bigger mobile OS platforms/ecosystems players such as Android, iOS and Windows and even social networking giants such as Facebook, eating into the native stickiness factors such as media, communication, social networking, commerce and much more.
A quick update on the recent string of important announcements by these emerging players laying a strong foundation for the future growth in these ecosystem wars:
· LINE announced its partnership with Avex Digital & Sony Music Entertainment to form a new music streaming service LINE MUSIC. Great way to offer new form of content to hundreds of millions of users in addition to the social games, stickers, etc.
LINE also announced LINE PAY to allow Line users to use LINE platform to conveniently and ubiquitously pay using their smartphone regardless of the OS, carriers. This is another way how these platforms are spreading their reach taking a slice out of user’s digital lives and wallets bypassing other players
· In Q2 2014, WeChat formed a joint venture with Baidu and Wanda to beef up its position in the mobile payments space. It recently also expanded WeChat payments adding in-store (offline) payments capabilities to its WeChat platform across major retail chains in China in addition to its popular digital wallet
· Viber meanwhile beefed up its platform by introduced “public” chat adding a huge social feature for more than 460 million unique users and 215 million monthly active users. Additionally, Viber also started rolling out social games within its platforms for millions of its users. We believe it would soon add m-commerce capabilities integrating its parent Rakuten’s e-commerce platform
· Snapchat on the other hand, is actively working to transform it app with a P2P payment capability Snapcash partnering with mobile payments player Square
· Kakao Talk (or Daum Kakao) also is advancing its platform with highly encrypted messaging – “Secret Chat”feature
· Blackberry’s BBM since going horizontal and cross-platform has been gaining traction and newer capabilities to make it one of the top choices for mobile enterprise communication. Apart from secure and privacy-centric communication, BBM has expanded with number of features such as Timed Messages, Message Retration, Stickers, Music Discovery, BBM Meetings and BBM Channels for different brands to advertise and engage users
· However, Facebook (+ Whatsapp) & Google with their huge user base comparatively have been still in stealth mode and haven’t gone full monty with their strategy on how they will leverage Whatsapp or Android respectively in a way to avoid losing mindshare, timeshare and eyeball share to these players
· As we highlighted earlier, these players are also a threat to Amazon as it needs to re-think a So-Lo-Mo strategy as hardware as a distribution strategy will not take it too far
These apps are certainly transforming into huge and highly capable platforms and ecosystems, locking-in users and taking a greater share of their digital lives. Following exhibit illustrates the level of reach these platforms are gaining in the top five areas of a digital mobile-centric ecosystem