Why Aren’t More Tech Journalists Talking About This? #Apple

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…this was my stance after the Apple announcements of iPhone 6, 6+, and the watch but all jokes aside, there is good reason Apple is the most valuable brand on the planet and simply “mind-blowing“.

Personally, the Watch does nothing for me. I would never own one. The app screen (points below)

apple-watch_custom-6f232f81d85587d089f8eeee63219236ca239b23-s40-c85

triggers my trypophobia (yes, trypophobia is real) and the design is just outdated — totally 80s.

However, what Apple did with the watch, as well as all the iPhones after the 4, is create a problem then solved the problem for us. First world problem-ing in the highest order. Or in scientific terms: they tap into the last triangle of Maslo’s Hierarchy of Needs, by making us need things we didn’t know we needed.

This deep understanding of human behavior and finding ways to hook people with design and hardware is something very few companies can achieve. Apple consistently creates problems then seamlessly and elegantly solves them for us — truly, one of the most innovative companies of our time.

People say now, things like “why do we need payments on our wrists, when we can do them on our phones?” Or, “why would we need payments on our phones and wrists?” I say, just wait – people will start getting lazier because they’ll adopt to the convenience of phone functionalities on body parts (wearables) and soon, it’ll be the norm.

Think about it: everything about technology is creating and solving more convenient ways of living. Telephones, email, computers, laptops, mobile phones, smartphones, tablets… and the next: wearables.

With the Apple Watch, Apple is now giving us 1) predicted text so we don’t have to type. 2) a way to transact without the extra effort of pulling out our phones. 3) a new type of push-pull notification system in a way that no other product or software does.

Which to me, is the most exciting part of the Apple announcement – all personal thoughts about style aside. It’s a bit peculiar to me how a lot more people aren’t excited about that vs the new and shiny hardware.

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43.3% of Japanese use LINE Professionally, 29.6% use Facebook

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Wow — I knew messaging apps are huge in Japan but it still astounds me to see numbers.
43.3% of those in the sample pool use LINE professionally.
29.6% use Facebook as a professional communication tool.

Skype is 12%
KakaoTalk 6.1%
Followed by LinkedIn, Viber, communicator.

I guess as Hiroko Tabuchi of the NYT reported: “It’s just easier when a bear says it.”
*above stats provided by MMD — a Mobile Marketing Data Labo, a research company in Japan.

Charts: Global Internet usage

I had to blog this vs tweeting  — it’s just too good not to share.
Take a look:

share-of-population-that-has-never-used-the-internet-2013_chartbuilder

  • 20% of Europeans have never used the Internet.
  • 34% of Italians have never used the Internet — via qz

Granted, there are still 13% of American adults in 2014 don’t use the Internet [1] but these numbers still astound me.

Then there is Asia — and I loathe using ‘Asia’ so loosely because Asia is BIG — but they are the global leader in online growth: 42% APAC vs 27% Europe — Comscore Asia forecast (PDF)

This is also a good opportunity to revisit the scope of technological adoption and revenues coming out of Asia.
Parallel with online growth; the increase of mobile traffic, combined with mobile revenues makes this region, the most interesting when it comes to disruptive technologies + monetization.

ChartOfTheDay_1088_Percentage_of_global_page_views_from_mobile_devices_n

 

Asia includes the following four countries: China, India, Japan and South Korea. Those four countries account for 66% of Asia’s population, 60% of Asia’s mobile connections and over 70% of regional mobile income. Four markets, four countries with four very different ecosystems.

China = population of 1.4 billion people, GDP of 8.2 trillion USD
India = population of 1.2 billion people, GDP of 1.84 trillion USD
South Korea = population of 50M people, GDP of 1.13 trillion USD
Japan = population of 127.6M people, GDP of 5.96 trillion USD

Then, there are the smaller countries with high GDPs and/or high population like: Hong Kong, Singapore, Taiwan, Thailand, Indonesia, Malaysia, Philippines, etc., etc.

To put that into perspective, the US has a population of 314M people (double Japan) with a GDP of 15.68 trillion USD. Compared to the big four Asian countries (Japan, South Korea, India and China), the US has been ahead of the race as far as development, access and economic distribution. This development gap the US has, is significantly wider with India and China than the gap the US has with Japan and South Korea, but the US is still ahead of these four countries.

WSJ just reported China is projected to overtake the US in mobile revenue [2] but as I said here, Japan should be the market to pay attention to, as

  1. smartphone penetration is still low
  2. spend is high — and keeps growing

Looking at global run rates and stats, it’s all about Asia and realistically, which markets and ecosystems one can penetrate.

 

 

 

Japan App Store Rapid Growth

Startling facts:

  • Japan app store is expanding faster than expected, especially for apps outside the top 3-5.
  • by Mar 2015, a #10 ranked game will earn ¥1.7bn/m, which is the same as #2 earned in Nov 2013

 

State of mobile in Japan:

Screen Shot 2014-04-10 at 4.13.16 PM

 

 

  • Japan has 10x the USA’s population density, used to spending with carrier (payment) settlement since the 90’s (with iMode)
  • over 30% of households are one-person == spend more on entertainment vs family

Innovation has come to a halt in Japan and indeed on the surface it may seem that way as Japan has always been known for their hardware: Sony and Nintendo the two leaders at the helm.

However the Japanese people are still spending and looking to spend. They are the users and ultimately, paying customers, even if Japanese companies like Sony and Nintendo fail to deliver ‘innovation’.

Isn’t spend more important than who or what is actually delivering?

When I see figures like these:

non-Japanese companies listed in Japan
1991 = 127
2014 =  21

I can’t help but to be baffled. I get the allure of the BRIC countries but China and India are such unique markets with distinct ecosystems. Why wouldn’t a company want to come to a country with consumers who are looking to spend?

One thing is for sure — like I keep repeating — the world is not going to know what hit them when Japan’s smartphone market finally matures and the numbers that will come out of this country will blow people’s minds.

There is still massive opportunity in this country and one of the biggest reasons I am here.

*above from Japan/Korea Market and Japan App Store Macquarie Research reports unavailable to public.
Listed companies in Japan via The FT

Messaging Apps are Communication Tools

Finally – I get it now. And by it, I mean the WhatsApp acquisition by Facebook.

It’s what I’ve been preaching — that messaging apps are not social networks. They are communication tools / utilities.

So basically, Facebook just bought a telephone company.

But I’m still wondering what is going to happen when messaging apps fully evolve to multi-faceted platforms (gaming, commerce, communication tools); basically the ‘what’s next‘. WhatsApp is going to be left behind.

Only time will tell. I guess.

 

WhatsApp: Time to Grow-up and Start Making Money

There is a piece on All Things D about WhatsApp’s CEO calling out other messaging apps and their “bullshit metrics”.

“We want to steer the conversation to be about active users, not registered users,” said WhatsApp CEO Jan Koum. “We’re a bit fed up and frustrated about people talking about registered users. We think it’s important for us as a leader in the space to speak up and be ethical.”

…the CEO, Jan Koum says.

In a competitive space as messaging apps, it’s no longer just about mass adoption. WhatsApp is the most adopted in markets where users do not spend.

These charts basically speak for themselves. Their pay-per-dowload and one dollar annual fee is cute, compared to the business oriented players as Line, KakaoTalk and WeChat.

Messaging apps are not social networks. They are communication tools and now, moving on to becoming businesses, shifting from apps to e-commerce.

I can’t be the only one who thinks it’s peculiar how WeChat has the most MAUs (monthly active users), yet they are profiting the least.

Calling out other players in the messaging space is nice and all but “we have the most users! we are superior!” mind-set is no longer enough.

Time to grow-up and answer the question: Where is the monetization strategy? #1 in MUAs, last in revenues. Hi, Facebook.

*All Things D piece is here
chart sources 1, 2

Messaging Apps: What’s Next

Several have asked “what’s next?” after this post on messaging apps was published. By what’s next, I’m assuming people are wondering what I see as the ‘next big thing’. There are several ‘what’s next’ questions that need answering. Here is one. Who will win the messaging space?

I went into details about Line in particular because they are taking the right steps in differentiating themselves from the other messaging apps.

  1. product evolution — Line, continues building new features and functions that fit user needs. Most recently they released an event app Band, that is like Facebook events but a million times better.
  2. business models — like I said, stickers are not after-thoughts or novelty items. Stickers, are part of their monetization strategy. Line also does merchandising. They license their characters and collaborate with brand partners to bring things like thisbnr_crocs
    Aside from Crocs they partner with toy makers, accessories makers — basically about any company — to bring stuffed animals, plushies, cell phone accessories, and of course, stickers. [1, 2, 3] They recently collaborated with Maybelline to even bring Thailand users flash sales. Their next step, is eCommerce. Obviously.

Because of the above, I believe LINE will be the ultimate of messaging apps. And I still stand by my statement they will not successfully localize in the US. Messaging apps don’t have a place there.

As for the the Snapchat counter-argument, I am pasting a response to a comment.

I commend Snapchat and indeed their rise proves there is a need but if you look at the feature differences, you, too, will agree Snapchat is not on the same playing field as Line, KakaoTalk and WeChat. WhatsApp, Kik and Viber aren’t even on their levels.

Snapchat serves as a fun tool. WhatsApp, Kik and Viber are communication utilities like Line, KakaoTalk and WeChat. The differences are, the latter three have business models and strategies. Where the former are just…building to build.

In the American market, Instagram (if they lay out their product pipeline correctly and ultimately include text communication sans comment thread) will ultimately win the space (in the US).

As for ‘what’s next’, as in what is the next big thing?  Easy: wearables.

I think it’s absolutely fascinating though, how the US is moving back into hardware, while the software shift is happening around Asia. God, I love technology.

Added. Wired agrees wearables are what’s going to be hot, too.