Korea's pioneering mobile messaging apps have taken their oversized
emoticons to Indonesia, intent on breaking the dominance of BlackBerry
Ltd's BBM messaging service in one of the world's most active social media markets.
Corp has hired pop stars and Naver Corp unit Line
Corp has partnered Samsung Electronics Co in a country
whose capital Jakarta boasts the most users of Twitter Inc's microblog by city, according to researcher McKinsey & Company.
BBM has long been Indonesia's most popular messaging app, with Facebook Inc's
$19 billion buyout target WhatsApp in pursuit. But KakaoTalk and Line
have connected with younger users by also offering voice calls, games,
shopping, merchandise and stickers, or message-conveying cartoons.
make up over half of the 240 million Indonesians, where just 20 percent
use smartphones, making the country a prime growth market for app
makers. Estimates put smartphone use at 50 percent before the end of the
decade, by which time messaging apps' global revenue could be over $24
"Indonesia is probably the most competitive mobile
messenger market right now... And it's a key market we want to win,"
said Kate Sohn, vice president of Kakao's global business development
KakaoTalk has gained 16 million users in just one year
in Indonesia after Kakao signed an advertising deal with Big Bang - a
K-Pop boy band popular in Indonesia - and started offering unlimited
KakaoTalk data through carrier Telkomsel .
whose maker plans to list in Korea around May next year, was
Indonesia's 37th most downloaded free app on Apple Inc's App Store as of March 7, and 14th on Google Inc's Google Play, according to researcher App Annie.
was first on both since becoming available through those stores in
October. Broadening compatibility freed BBM users from BlackBerry
handsets, and left BlackBerry with just 5 percent of Indonesia's
smartphone market in October-December from 34 percent a year earlier.
falling domination... has made Indonesia more dynamic and created a big
opportunity for new entrants," said Kakao's Sohn. "Indonesia has the
right mix of big scale, growing number of smartphone users and the
market is really in flux."
entered Indonesia in early 2012 and has 20 million users thanks partly
to it being pre-installed on some smartphones running Microsoft Corp's Windows Phone and Google's Android operating systems, including models from Samsung.
sells about one of every three smartphones sold in Indonesia, and from
this month its entire Galaxy range will have Line pre-installed.
done lots of collaboration with Samsung and are benefiting from their
growing brand strength and volume shipments," said Simeon Cho, general
manager at Line Plus, which handles Line's business outside of its
biggest market Japan.
Line is also likely to be pre-installed on
Nokia's first Android smartphones targeting the low-end segment popular
in emerging markets such as Indonesia, and which researcher IDC expects
to lead global smartphone growth.
As for global revenue growth,
Macquarie Group said in a March 5 report that income from advertising,
games and stickers could push messaging apps' revenue to $24 billion
within three years, rather than the $10 billion the finance house
forecast in September.
Making it stick
The proliferation of
messaging apps has spawned features such as stickers and in-app shopping
as makers seek to be different. It has also resulted in users
downloading multiple apps to accommodate contacts' preferences.
"Customers contact me through BBM, WhatsApp and email," said Saskia Tamat, 37, who runs a catering business in Jakarta.
lot of my friends also use Line, and we send each other stickers
instead of just texting. I downloaded KakaoTalk, because I watch a lot
of Korean dramas and movies and saw they use cute stickers."
journey up the ranks will also see it contend with WeChat from Tencent
Holdings Ltd. Tencent established a joint venture last
year with Indonesia's biggest media group, Global Mediacom Tbk PT , and is advertising heavily on television.
is interesting to see the battle of messenger apps in Indonesia because
it's an open field," said Enda Nasution, social media analyst and
founder of social media platform Sebangsa Bersama.
looks far from willing to surrender. The market appears so important to
BlackBerry that the company has code-named its low-end smartphone Z3
"Jakarta" which it plans to launch first in Indonesia in April.
still have a strong emotional attachment to BBM. Though its growth rate
appears to be slowing, many think it won't completely go away any time
soon," said Line Plus' Cho.
© Thomson Reuters 2014