Mobile messaging apps core to an evolving ecosystem

These apps become the core platform to build an extensive ecosystem of related, value-added services which developers and service providers hope will boost monetization opportunities and retain user traction.
Written by Jamie Yap, Contributor

Given the prevalence of mobile messaging apps, developers and service providers have spotted an opportunity to increase user traction and monetization by building on the app as a platform, and grow an ecosystem filled with assorted value-added features and related services.

Mobile messaging apps have contributed to a dominant "chatting culture" in mobile user behavior today, said Ashadi Cahyadi, senior research manager for telco and mobility at IDC Asia-Pacific.

The prevalence of mobile messaging apps has unearthed an opportunity for developers and service providers to build an ecosystem around the app, to boost user traction and monetization.

Oftentimes users multitask other activities on their devices as they chat, or try to kill time by chatting with friends. So developers and service providers want to take advantage of the familiarity and frequency of mobile messaging app usage, which show no signs of abating, he pointed out.

Rohit Dadwal, Asia-Pacific managing director of Mobile Marketing Association, concurred, adding companies hope to "springboard" consumer interest in all kinds of related mobile services.

These can include mobile banking (m-banking), m-commerce and mobile shopping, and m-health whereby patients chat in real-time with medical professionals. "The possibilities are really only limited by what users are willing to do, and how well service providers and developers can implement these features," he said.

According to Lim May-Ann, research director at TRPC, since mobile phones first came into the picture, after which services such as ringtone downloads emerged, an ecosystem around chat apps is simply the next stage in the development of mobile technology.

What is happening now is the mobile industry undergoing another process of monetization. "Nothing new here, except the stakes are much higher. This is a fight for survival," she noted.

Most consumers now "can't imagine living without WhatsApp", and as user numbers grow, new ways of engaging the ecosystem will be created, which will mean more time spent on the ecosystem and more dependence fostered on its use, she explained.

Ubiquity has benefits, barriers

Neha Gupta, senior research analyst at Gartner, said how consumers benefit from an ecosystem boils down to how rich the features and experience are.

Market players have to focus on creating an integrated communications platform, so the user can effectively use the same platform on any device of any mobile operating system (OS) at any time. This can range from in-app billing as well as audio message recording, she pointed out.

Reaching these specifications comes with challenges, though. For one, growing the ecosystem naturally involves large costs since it is a "scale game", so smaller players could be beaten easily by larger providers, said Gupta.

Lim agreed, adding besides interoperability and integration issues, data security will also need to be managed, all of which come at a cost.

There are intangible concerns as well, she pointed out, such as consumer privacy and confidentiality, especially since companies may want to mine the data generated from all the user interaction in the ecosystem for analytics purposes.

Another challenge will be localization of the ecosystem, which is due to cultural preferences, Lim said. For example, users' penchant to purchase virtual stickers or emoji--the Japanese term for ideograms or smileys--may be limited to certain Asian countries.

"The fact of the matter is technology is used by people and governed by culture. And that's the challenge of expanding the mobile chat ecosystem--how to predict what a certain group of people would like to use," Lim noted.

Dadwal pointed out a potential challenge could be the attitudes of the parties involved. Any business wants to retain its existing customers while offering them more options, but the question is how much are they willing to work with other businesses to enhance their own offerings.

Beyond messaging borders

Developers of mobile messaging apps are already muscling up to expand the ecosystem.

Hastings Singh, vice president and managing director for South Asia at BlackBerry, said an ecosystem enhances the user experience, moving "from just real-time chat to meaningful real-time engagement" for users. Earlier in February, BlackBerry in Indonesia partnered a local bank and mobile payment provider to pilot a new service, called BBM Money, that enabled money transfers between BlackBerry Messenger (BBM) users in the country.

More recently, the developer of KakaoTalk app, Kakao, launched a new mobile content platform. The Kakao Page service allows consumers to purchase content such as videos for as low as 500 won (US$0.44) per download. Subscribers can also upload their own content to the platform for a 50,000 won (US$43.80) annual fee.

Another company, LINE Corporation, which developed the LINE messaging app, launched LINE Manga that allows users--only in Japan for now-- to read manga comics on iOS and Android devices. The app is linked to the core LINE messaging platform by allowing users to share their favorite comic on their timeline.

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