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News  21, Jun 2013

LINE’s new free coins feature available for Android only, but why?

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Line app logoLINE has launched Free Coins in Japan, Thailand and Taiwan, turning the messaging app into a platform for businesses to promote their brands.

LINE Corporation, owners and operators of the free calling and messaging app, LINE, has just announced their launch of LINE Free Coins, an incentive-based app recommendation service available on the Android version of LINE. The whole new LINE Free Coins will launch in Japan, Taiwan and Thailand, and will roll out to other geographies in the future.

So how does it work? According to the press release, users can get LINE Coins by installing selected apps. Coins acquired can be used to purchase premium stickers and other virtual goods through LINE.

Previously, premium stickers could only be purchased with cash or prepaid Coins. LINE Free Coins offer users an alternative option to acquire these stickers at no cost. Furthermore, the apps, which users can install to receive the Coins, include apps outside of the LINE family, providing LINE users with a chance to discover more quality services.

With this new free coins feature, it effectively turns LINE into an incentive-based app recommendation service, adding on yet another revenue stream for LINE. It currently monetizes through virtual content such as stickers, in app purchases through its games platform, as well as through its official accounts system, which allows brands and companies to engage with users on the LINE platform.

The company posted revenue of US$58 million in Q1 2013, which was up 92 percent from the previous quarter. In-app payments and other revenues from the company’s LINE Games accounted for around half of all income while revenue from stickers was 30 percent, which is a little over US$17 million.

A couple of interesting questions surface along with the latest free LINE coins feature: Why Android only? Why skip the iOS platform, the platform that supposedly generates more revenue for developers and app providers? In case you’ve forgotten about the recently concluded WWDC 2013, Tim Cook announced that Apple has paid more than US$10 billion dollars to developers in the last year alone in revenue from App Store sales, suggesting that iOS users are more willing to spend on apps.

First school of thought: App revenue on LINE Android needs to be ramped up

So here’s two school of thoughts to why LINE has prioritized Android users with its launch of free LINE Coins. The first one is obvious: sales revenue is doing better on its iOS app (games, official accounts, sticker sales, paid LINE coins), and to ramp up its revenue from the Android department, LINE free coins are one of the ways to boost the numbers up by shifting the revenue generation from users to businesses who want to leverage on LINE. Businesses pay LINE using the CPI (Cost Per Install) system.

Businesses that utilize the smartphone as a promotional tool, the Free Coins service offers a chance for their apps to be promoted within the LINE platform. With LINE’s enormous user base and the service’s CPI (Cost Per Install) result-reward system, apps of operators and businesses have the potential to be downloaded and used by a global audience.

Second school of thought: Apple delays iOS 7 development

The second school of thought is that leading up to WWDC there had never been a better time for developers to invest big in Android. The growth numbers of Android looked good: market intelligent companies all agreed that Android is eating away the market share of iOS, and Google’s platform currently owns more than 50 percent marketshare globally. Even in Southeast Asia, Android dominates with 70 percent market share.

It makes sense for LINE to focus on Android.

While there is no official news from LINE as to when the LINE free coins will be available for its iOS users, we expect the team to be working on the feature really soon, and it will probably come along a whole new update once iOS 7 launches. Why was the feature delayed? iOS 7 might have played a role in it.

iOS 7 is different, as Marco Arment puts it: It isn’t just a new skin: it introduces entirely new navigational and structural standards far beyond the extent of any previous UI changes. 

As with other app developers, with the new iOS7, they are rethinking their apps from the ground up. This isn’t as simple as just putting a fresh look on their existing products, and the redesign probably means that the product roadmap for any apps need to be restarted from scratch — and this needs time.

TechCrunch founder Michael Arrington also interviewed a couple of people regarding iOS7, and he revealed on his personal blog that a bunch of startups are looking at iOS7 as a whole new platform.

So how are startups responding to the news? They’re “tearing up their Q3 product roadmap” and “starting from scratch,” say a few of the startups I spoke to. “There are subtle but profound changes,” says one.

Another CEO I spoke to off the record today said that he’s leaving his Android client engineers on task (they’ve released both iOS and Android apps), but all UI/UX designers and engineers are focusing 100% on iOS 7.

And another startup founder: “Android is no longer on our 2013 product roadmap.”

And finally, the worst news of all from yet another mobile startup – they’re canceling all summer vacations.

Update (1.45pm 21/6): Another simple reason why it’s not available for iOS users is simple because, Apple says “No!” to LINE.

Apple clamps down hard on incentivized downloads. Take AppGratis for an example. AppGratis runs a daily deal business model which involves taking money from developers who wish to promote their apps to its 12 million users and negotiating deals so that apps or in-app content is free for the duration of the offer. According to Apple, it violated two clauses of its developer T&Cs, which resulted in Apple killing its ability to send push notifications to existing users of its app. Some 12 million users were affected.

Line free coin to be offered in Japan, Taiwan, and Thailand first

Along with the announcement, the feature is only made available in Japan, Taiwan and Thailand, before being gradually rolled out in other countries. It’s hardly surprising to hear LINE rolling out in these three countries: LINE enjoys the highest and fastest user growth here. According to its recent financial report, LINE currently has more than 45 million users in Japan, followed by over 15 million users in Thailand, and over 15 million users in Taiwan. The next country that follows in terms of number of users is Spain, with over 12 million users.

It currently has over 165 million users globally, with plans to double the number by end of the year.

With its highest user base here in Japan, Taiwan and Thailand, it makes sense to launch the feature in these countries here, which aims to help businesses gain distribution and visibility.

So for LINE users who are not based in these countries, we will just have to wait for the feature to be rolled out in our country, hopefully in the very near future.

Read also: LINE grows an audience in Hong Kong due to increase in SMS charges

Jacky Yap

Jacky Yap

Having spent one year abroad in Shanghai under the NUS Overseas College Programme, Jacky has an avid interest in entrepreneurship and web based startups. Jacky used to run N-House, Singapore's first entrepreneurial themed residence in NUS, and was also part of the organizing team for Startup Weekend Singapore 2012. You can reach him at jacky [at] e27 [dot] co

  • http://www.serkantoto.com/ Serkan Toto

    I think that LINE didn’t even try to submit this to the App Store because of a simple reason: Apple has not been allowing incentivized installs scheme since April 2011.

    That’s also the reason why LINE Corp.’s partner Metaps has been Android-only from the get-to.

  • jackyyapp

    Yeaps just found out about this as well! Very interesting. I learn something new everyday!

    Thanks Serkan!

  • Pingback: ????LINE???????InMobi????????LINE Coins | ????

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