Talk ain’t cheap
By Yoon Ja-young
More options in the mobile messenger market is raising temperatures as giant IT companies are launching comparable services. Players from diverse industries such as Internet companies Daum and Naver as well as manufacturers Samsung Electronics and global power players Apple and Google all want a piece of the text messaging pie. Even mobile carriers provide mobile messenger services willing to sacrifice their profit in text and voice call services.
NHN, which operates the country’s top portal Naver, announced the launch of Line, a mobile messenger service, Wednesday. The free messenger service for smartphone users has some new features, such as registering another Line user nearby as a friend by gently shaking their smartphones together, or entering a QR code for each user.
In February NHN launched Naver Talk, but it managed to attract a paltry 3 million users as it is only available for Naver users. To better compete with the popular messenger services like Kakao Talk or My People, operated by Daum, NHN subsequently opened the new messenger service to all smartphone users including those with iPhones.
Samsung Electronics also announced that it will launch Chaton, a mobile messenger service, in October. The handset manufacturer, which is seeking to bolster software sector, said the service will be installed in its Galaxy phones, sold in 20 countries in 62 languages.
SK Communications, which operates the popular local online messenger NateOn, launched Nate Talk, a mobile messenger, and Google’s Google Talk and Apple’s iMessenger, scheduled to debut next month, are threats to local messenger services.
Profit model initially doesn’t matter
Most of the mobile messenger services are free and for now there is no clear profit model. Money is being poured into this market to secure users first since, in this market, the number of users means profit.
“They have focused on luring as many users as they can, making their service a ‘platform,’ instead of setting up a specific business model,” said Ahn Min-jee, a researcher at the KT Economic and Business Research Institute, in a report. She suggested that the most probable business model is advertising using user information and added that social commerce or deals of the day can also be considered.
Following the power shift from fixed line Internet to wireless, messenger services are likely to be the portal where people start all their mobile activities, as what happened with Naver here. KaKao Talk, the country’s most popular mobile messenger service, has surpassed Naver in terms of daily visits, with 16 million to 17 million a day, compared to Naver’s 15 million.
Mobile messengers are substituting text messages and voice calls as well. Kakao Talk is used to send a total of 500 million comments every day, more than the total number of text messages sent through the three mobile carriers in the country combined.
Ahn said that mobile messaging has a bright future when considering that youngsters use more text services than voice calls. “They will evolve into a rich communication service in the future, coupled with voice and video services as well.”
According to an estimate, the global mobile messenger market is expected to reach $200 billion dollar this year from $179.2 billion last year, and amount to $334.7 billion in 2015. The number of users is expected to grow by 39 percent annually, bolstered by greater smartphone use, lower priced data schemes and expanded networks.
Kakao Talk is definitely enjoying the first mover advantage in the local market, securing 22 million users since its launch in August last year. Many of them chose the service because their friends were already using it. Despite providing more diverse functions, the latecomers are unable to catch up.
“A design that isn’t heavy and considers the convenience of users will be the key to success for these services. Messenger services shouldn’t be simply listing the means of communications they offer,” Ahn said.