With Indians specially the youth spending more time on mobile, messaging apps in India are witnessing an explosive growth and business initiatives. The world’s most popular messaging app, WhatsApp is leading the race in India with more than 40 million active users. The fight now is to occupy the second spot and then subsequently provide a stiff competition in a market, recently tagged as the fastest growing smartphone market in the globe by Gartner.
There is homegrown Hike, Chinese giant Tencent’s WeChat, Japan headquartered Line, Nimbuzz and Cyprus based messaging and VOIP app Viber to name a few, who are competing in the messaging space as well as expanding their base into voice.
Known for its free voice calling feature, Viber made big news last month when it was acquired by Rakuten, one of Japan’s largest Internet companies, for $900 million. However, the news phased out after Facebook dropped the bomb with its acquisition of WhatsApp for $19billion.
But, Viber is not out of the game; it is already adding 600,000 users daily, up by about 50,000 from Feb 14 when the deal was announced. At the time of acquisition, Viber had 100 million active users from its 280 million global registered users. Hiroshi Mikitani, CEO of Rakuten and Japan’s third-richest person with a net worth of $8.2 billion, in an interview with Bloomberg Technology shared that he aims to expand to 2 billion users with this acquisition.
Related Resources from B2C
» Free Webcast: Build Better Products by Identifying and Validating Your Riskiest Assumptions
Viber today has 300 million registered users globally out of which 16 million are registered users from India and 4 million are the active ones. Today India is an important market for Viber which has India operations based out in Gurgaon.
“We started our operations in India in December, but the app has been around for the last three to four years,” shares Anubhav Nayyar, Country Head, Viber India, while exchanging his thoughts over an email interview.
The key idea behind setting up an Indian operations unit was to understand the consumer for Viber which operates across 193 countries. “One of our key imperatives is also to understand what the users like or dislike – not just about Viber, but about the social messaging space in general. It is such an evolving category that it changes every two-three months.
So although we have been able to maintain our position, one of the key things is to bring about localization.”
Viber believes in providing a great user experience and it is developing products that help users share rich content. “We have always ensured that our products are simple to use and because we believe that if a product is simple to use, has a good user experience, provides some relevant benefits to the consumer, advertising can be kept on hold,” Nayyar said while sharing Viber’s philosophy to not confuse its users by introducing ads or games.
Viber’s presence on all major platforms has helped its growth and since India is still dominated by 80% feature phone market, Viber’s presence on desktop has been a boon. Going further Viber will be directing its efforts towards improvising its existing products.
The recent partnership announced at the MWC 2014 with Nokia wherein Viber will come pre-installed on Nokia’s new range of Android phones will boost the user base, Nayyar predicts.
Viber is not only working on the user experience and introducing localized products, it is also working on scaling its revenues. Mikitani recently acknowledged that the Viber deal was a big one at a time when Rakuten had a $29.5 million net loss last year. So the focus is to monetize for the company that paid about $3 for each of Viber’s users.
Right now Viber has two revenue models: first is via the Viber stickers or rich emoticons, close to 90 percent of stickers are free, but for the rest one has to pay and they are renowned characters such as Garfield or Smurfs. So users have an option between these or the 1200 odd free stickers. So this model is based on expression.
Nayyar states that, “people love to communicate through stickers to express themselves and therefore they are even ready to pay for these stickers.” However, he chose not to share any numbers on what percentage of people from India are opting for the paid stickers.
The second part of monetizing is based on functionality. Viber has Viber Out feature which allows users to make calls to anyone across the globe on their cellphones or landlines.
Voice calling feature is getting exciting with WhatsApp and Nimbuzz joining the space with telco partnership. However, Viber isn’t worried about the growing competition and is confident about the superiority of its services.
“When it comes to making calls using data connection in the phone, we have better technology. We are confident that we will offer the most clear and reliable calls using data connection. Other app makers may try to include the same feature in their IM apps but our service will be superior,” Nayyar informs.
Further he states that, “Viber Out works really well on 3G. With 2G, users may face a bit of network issues but if you want to really enjoy the video, you should be on 3G.” With 3G roll out yet to be a success in India, Viber Out will have to wait before it becomes a common go-to feature for calling.
Talking on the recent controversy created by telcos in India asking TRAI to impose regulation on messaging apps, he thinks that telecom operators are never a competition and there is a symbiotic relationship existing between operators and instant messaging apps.
“At the end of the day, instant messaging apps run on data plans which are provided by these operators, except for when people are using it in a Wi-Fi zone. People love to share and be on IM apps and these add to the revenue of the telecom operators.”
Going further in 2014, Viber aims to double its user base by providing them with unmatched messaging and voice calling features. Nayyar also added that with a team based in Gurgaon which is purely focused on investing in research to create localized content for India, Viber users could look forward to some exciting innovations in the coming future.