With 52 different primary languages, more than 1000 regional dialects, 27 different currencies, and varying political and legal systems, the very diverse Asia is quickly becoming a big player in the mobile markets because it is fast becoming a mobile-centric society. However, this diversity can also pose a challenge despite its massive size. Therefore, the monetization approach has to be very different in Asia. Although messaging apps are exploding, the battle is still far over.
Several statistics prove this. Feature phone users outnumber Smartphone users 4 : 1 and 2.4 billion features phone users still represent the masses. Although Japan and Korea are growing fast, India and China are much slower. Plus, many countries have limited data plan penetration, even with Smartphones.
Different Mobile trends across the region
In places such as Japan and Korea, search query trends on the mobile have begun to exceed PC queries. It has also noticeably increased exponentially while PC query trends have remained fairly stagnant. In June 2012, China has also reached these statistics.
However, with Japan and Korea being outliers, many of the countries in Asia still lack significant smartphone penetration. Even though there is a growth, it is estimated that in 2015, more than 2 billion people would still be using feature phones in Asia alone. For example, there are 856 million feature phone users in India, 166 million and 97 million in Indonesia and Vietnam respectively. “If you’re looking out for the big pie, or some kind of network effect, you got to start thinking about these 2 billion,” Thomas advised.
The Value-Add Service (VAS) mobile trend in Asia… and its death
The VAS was hot 3 years ago but the Phillipines telecom regulators were the first ones to crack down on VAS in 2010 and started introducing more strict regulations. Thailand regulators later follow suit in 2011, Indonesia in late 2011, and India in summer 2012. Today, these mobile VAS has become totally obsolete.
The OTT APP Explosion
While the app explosion is a global phenomenon, China is the biggest app market with all the other Asian markets playing catch up. In fact, China just surpassed US as the number 1 app economy in the world.
However, there is still an uphill battle for the rest of Asia because the monetization of apps is still very low. (With exception of Japan) This is because there are several macro factors that drive a need for different monetization strategies in Asia.
This could explain why Asian users have been so receptive to social media and today, many love to share everything online. For example, more than 50% of people in India love to share “almost everything” online, places such as Indonesia and South Korea are at 50% and 40% respectively.
After all, social media and OTT messaging apps is a more fun and cheaper way to communicate. These new services are definitely way more innovative and consumer-driven too as compared to traditional mobile messaging operators.
So, who is winning in the Messaging Battle Asia? Is WhatsApp, LINE, KakaoTalk or WcChat?
In Japan, LINE dominates 44% of market share followed by KakaoTalk at 6%. However, with KakaoTalk teaming with Yahoo! Japan and both DeNA (COMM) and GREE launching their own competitive apps, these statistics are looking to change. In South Korea, KakaoTalk takes up 88% followed by LINE at 6%. In China however, WeChat takes up 38% of market share followed by WhatsApp at 11%. In conclusion, there is basically no common trend that explains the popularity of each messaging app in each country.
Plus, monetization strategies between these apps vary widely too.
The future of messaging apps in Asia
Due to strong network effects, the success of the messaging app could be a case whereby the winner takes it all. However, this could be driven by country or communicate type. This being said, the war can never be over because switching costs from one app to another is minimal and decreasing. With Facebook connect and deep contact list integration on the phone, it is extremely easy to migrate.
Another interesting point that Thomas added was about the curation of the user community in the early stages of the app. With so many messaging apps spinning off, one key factor that differentiate the app could possible be the early adopters of the app. This is because the community of users define the apps and influence the other late adopters. Facebook and Twitter have done it extremely well in the early stages by recruiting tech geeks, and students to be their first ambassadors.
Featured image credits: Pictures of Asians taking Pictures of Food