A handful of smartphone apps that began as basic instant messaging
services have amassed several hundred million users in Asia in just a
couple of years, mounting a challenge to the popularity of online
hangouts such as Facebook as they branch into games, e-commerce,
celebrity news and other areas.
Among them is Line, which has grown to
60 million users, mostly in Asia including at least 29 million in
Japan. Its developer estimates the number of users will reach 100
million by the end of this year. Also popular is Kakao Talk with 60
million users, more than half in South Korea where it originates. Other
successful messengers are Nimbuzz made by an India-based firm which has
amassed 100 million users including 31 million in Asia, and WeChat by
China-based Tencent, which is nearing 200 million users.
The rapid
growth of such applications underlines that people are increasingly
going online using mobile phones and other wireless devices. It is a
trend that has proved problematic for the world's most popular social
networking site. Facebook has lost more than $50 billion of its market
value since its initial public offering largely due to doubts about its
ability to successfully insert advertising into the mobile version that a
large and growing number of its 955 million users access from
smartphones.
"Japan, Korea and to a lesser extent China are
leading the way in terms of mobile messaging-centric apps that move into
diverse and potentially very profitable new service areas like gaming,
affiliate marketing, next-generation emoticons," said analyst Mark
Ranson at research firm Ovum. "Offering a free, high quality messaging
service is a good way of building a large and loyal user base which can
later be introduced to more readily monetizeable services."
Instant
messaging, also known as IM, was first popularized on desktop computers
with applications such as Microsoft Messenger that evolved from
text-based chatting and sharing files to the voice calls and video
conferencing that Skype is known for. The advent of smartphones took IM
back to basics with services such as WhatsApp and Blackberry Messenger
that allowed for real-time chatting, swapping photos and not much else.
The new instant messaging apps such as Line have evolved into online
destinations in their own right.
"I use Line messenger every day,
about every hour instead of text messages or emails," Supinda Toochinda,
a 31-year-old interior designer in Bangkok, said in an email. She said
Line was the only mobile application she'd spent money with, buying
elaborate emoticons called stickers that can be sent to friends while
chatting.
Part of the appeal of the applications is the ability to
create an unlimited number of group chats and the ease with which
connections can be made the apps automatically create a contacts list
by harvesting the contacts list saved in the phone. At the same time,
managing privacy is simpler than on a social networking site.
Analysts
say these mobile messengers are showing more nimble and promising moves
in the efforts to make such mobile services profitable without relying
solely on advertising.
"Kakao Talk and Line are seeing
opportunities as Facebook isn't making money from users of its mobile
website and app," said Ryu Han-seok, director of the Technology, Labor
and Culture Institute, a consulting company, in Seoul. "In the mobile
markets in Asia, they are ahead of the game."
"It is probably
tough to compete with Facebook in the U.S. or Europe. But in Japan,
South Korea and other Asian countries, they have a good chance of
beating Facebook," said Ryu.
While Line messenger is expanding to
photo editing and sharing, social games and Twitter-like features that
allow users to follow corporate brands or celebrities, its windfall came
from sales of virtual goods. Sales of stickers a $1.99 bundle of cute
pictures of cartoon characters or animals have been its biggest
revenue generator. In August, users spent about $3 million to send the
elaborate emoticons when they chat with friends.
Kakao Talk, which
is only accessible on mobile devices, says it is trying to develop a
business model that isn't dependent on advertising. Since its launch in
2010, it has added a free voice calling service, a gift shop to send
Starbucks drink coupons to friends, and options for receiving weather
and news, discount vouchers and music videos.
"We are not
interested in displaying mobile banner ads just to make money," Kakao
Inc. CEO Sirgoo Lee said in an interview with The Associated Press.
The
app has been wildly popular in South Korea. Even a small disruption in
service makes news and it has entered the local lexicon with the phrase
"let's do ka talk." South Koreans are typically connected to multiple
group chats on Kakao Talk, holding conversations in separate chat rooms
with family, a group of close friends, co-workers and other circles.
According
to Appsooni.com, which compiles data on Android applications, South
Koreans used Kakao Talk for 62 minutes a day on average in August,
compared with 17 minutes on Facebook's Android application.
In a
move seen as bringing the three-year-old startup close to generating a
profit, Kakao introduced mobile games to its users in July.
"Giving
gifts or sending emoticons are business models that Facebook doesn't
have. Facebook simply displays ads so its model is different from ours.
(Facebook's) profit models are not tailored for mobile users," Lee said.