Can Line beat WhatsApp in the US market?

According to a globalization affected by internet, preferences of people around the world seem to be closer and closer, especially in technology-related issues. After coming from Thailand to study in US grad school, I was surprised by the different applications my classmates use for messaging. My American friends mostly use WhatsApp as a main platform in smartphone communication. The others depending on their countries use different application. They don’t use only WhatsApp, but also Line, WeChat, and Kakao.

WhatsappLine

WechatKakao

In my country, we used WhatsApp around 3 years ago. After Line had introduced in my country, suddenly almost all of users shift their main messaging from WhatsApp to Line. This circumstance also occurs in many countries in Asia and Europe. The data shows that there are 300 million users in the end of 2013 compared to just over 100 million in the beginning of the same year. Although WhatsApp also captured a higher number of new active users that year, this year that Line shift their focus to US and Latin America market, it is interesting whether Line beat WhatsApp in US market or not. In my opinion, Line has a chance to beat WhatsApp because of several reasons, specifically their value to customer, revenue model, and integrated platform.

Firstly, Line provides better value for users. Even though both applications are based on the same basic idea which is “free, simple, no ads”, Line outperforms WhatsApp in many reasons. For example, offered stickers in Line allow users to express their feelings better than Emoji in WhatsApp. Moreover, Line has a timeline function so that you can update your friend you have in a friend list. Also, Internet voice and video call are provided in this Application. Therefore, in your friend list, it’s not limit only texting, but voice and video call. This feature is also applicable in international call. Although Line introduce game in their application, it doesn’t disturb users because the game is in different tab and never interrupt when texting with your friends.

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Secondly, revenue model of Line and WhatsApp are totally different. As for WhatsApp, the company gets a yearly fee of 0.99 USD after year 1 onwards. Line is completely free for the texting and internet calling feature. They gain the revenue from selling Sticker and games. Although WhatsApp has users more than 450 million, their revenue was under 20 million in 2013. Surprisingly, line revenue was 335 million, around 17 times than WhatsApp. Disregarding the parent company of both companies, cash generated internally in both firm is totally different, affecting marketing, strategy, and development budget the companies can employ.

Lastly, Line is not only limited to smartphone, it is also integrated to PC. Users can use the same account they use in their smartphone in their laptop, getting the same contact list, and historical chat log. This feature helps the company to retain its current users when changing their phone or PC.

What I’m curious is that like most of social network platform, messaging application requires friends in your loop to switch to new platform. Even the application provides you better value or experience, without your friends in that application, no one will use it. A challenge for Line is how to convince the first group of user in US to change their application from WhatsApp to Line.

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