And Then There was One: How Chinese Messaging Apps Tried — and Failed — to Challenge WeChat’s Iron Grip on Social Networking

Zhang-Xiao-long-WeChat-App
WeChat is the brainchild of Zhang Xiaolong Allen, the 51-year-old head of the social-networking application and a legendary figure in China’s tech circles. (Source: Sohu)

After a 10-year run, Xiaomi has finally conceded defeat in the battle of China’s messaging apps.

The smartphone maker announced the shutdown of its instant messaging (IM) app MiTalk last Tuesday, citing a change to its business.

MiTalk said the platform will stop accepting new account registrations on Feb. 1, and its servers will permanently go offline at noon on Feb. 19, asking users to back up their chat history and personal data.

On the same day, Tencent unveiled an ambitious vision for WeChat, which is also a 10-year-long operation — except it currently has 1.09 billion daily active users and nearly 1.6 trillion yuan ($247 billion) of sales generated from its mini programs.

The irony is not lost on industry analysts, investors and Chinese users, most of whom have perhaps heard of MiTalk, but admittedly have never used it before.

Xiaomi actually got a head start in the IM game, launching MiTalk, or Mi Liao (米聊), on Dec. 10, 2010. It became one of the first batches of Chinese IMs to launch amid a messaging app revolution and was one of the most important businesses for the company before its smartphone debut in 2011.

Modeled after the Canadian-made messaging app Kik, MiTalk enjoyed a brief moment in the spotlight. In 2011, the app drew millions of users after launching a push-to-talk feature, which was first introduced by Hong Kong-made Talk Box. In 2012, Xiaomi Co-founder and Chairman Lei Jun gave an optimistic report card on the app: MiTalk had accumulated more than 17 million users.

But the honeymoon didn’t last long. One month after MiTalk’s debut, Tencent released WeChat.

And it was quickly evident which app Chinese people preferred. In March 2012, Tencent Chairman and CEO Pony Ma announced that WeChat had accumulated more than 100 million users, only 433 days after its launch.

After an iOS update in late 2016, MiTalk went quiet for nearly two years. It started to lose users as WeChat expanded ferociously, and it didn’t help that investment-fraud scammers flooded the platform.

In 2012, Xiaomi Co-founder and Chairman Lei Jun gave an optimistic report card on the app: MiTalk had accumulated more than 17 million users. (Source: Sina Tech)

MiTalk’s last efforts to revive the app took place in 2018, when it released a major update that included in-app games and Wall, a social platform with a newsfeed function for users to share photos. However, it was too late — WeChat already had an iron grip on the domestic IM market.

WeChat is the brainchild of Zhang Xiaolong Allen, the 51-year-old head of the social-networking application and a legendary figure in China’s tech circles.

As a minimalist, Zhang had always strived to develop an elegant and easy-to-use interface that provided simple text message functionality in WeChat’s earliest versions.

In fact, Tencent already had a dominant desktop chat app, QQ, and users could connect their accounts and import their QQ contacts into their WeChat account, immediately boosting WeChat’s user base.

In the cutthroat, winner-take-all environment such as messaging, reacting quickly is just as important as understanding the power of engagement driven by communication, if not more, writes Matthew Brennan, an author and speaker on Chinese mobile technology and innovation.

Knowing that it’s already the most frequented app on a person’s phone, Tencent immediately got to work, developing an array of ancillary businesses around that traffic.

Added functions and features were launched one after another, delighting users, including video messaging, “Shake-shake”, which connects two people shaking their phones at the same time, “Friends Nearby”, which lets users see who’s online within their proximity, as well as QR Codes, Official Accounts and Mini-Programs.

In 2013, Tencent debuted its mobile payment platform WeChat Pay, a significant addition to the app’s ecosystem and a gamechanger.

Today, with more than 1.2 billion monthly active users, the super app is an indispensable part of everyday life in China, allowing users to book train and plane tickets, access banking services and investments, pay electricity bills, book medical appointments, hail taxis, play games, and much more.

WeChat Wannabes Play Catch Up

During the emergence of China’s social and smartphone era, newcomers have tried to topple WeChat, but efforts have proved futile. Curious consumers have given all of these contenders a fair chance, contributing to a pattern of tremendous user growth in the first couple of months after launch.

Rival Alibaba launched its IM app Laiwang (来往) in August 2013, following an internal restructuring program with a strong focus on its mobile strategy. It lets users send voice messages, form group chats of up to 500 people, share stickers, maps and videos, and even send Snapchat-like messages that disappear after they are read.

The platform reached 10 million users in its first month, and Alibaba Founder and then-CEO Jack Ma was widely reported as shutting down his own WeChat account and telling employees they wouldn’t receive their year-end bonuses unless they sign up 100 new external contacts for the app.

Alibaba Founder and then-CEO Jack Ma introducing the IM app Laiwang. (Source: Zhonglongshiji)

However, features on Laiwang were gradually proven to be too similar to those on WeChat, and interest slowed down fast. Two years later, Laiwang was kicked out of the market by WeChat. Refusing to give up, Alibaba quietly launched a second social app in September 2019 named Real (如我), catered towards university students.

In the same year, China Telecom and web portal Netease released EasyChat, or Yixin (易信) in Chinese, in a joint venture. On top of other functions, the IM tool has a distinguishing feature of supporting free text or voice messages to mobile phone and fixed-line users. Right after its launch, the app became surprisingly popular, and in August 2013, it rose to become the third most-downloaded free app on Apple’s China App Store and surpassed WeChat to become the top free app in the social networking category. Today, data shows it has a little more than 3 million users.

Momo (陌陌) started in 2011 as a social networking app, but gradually evolved into a platform for online dating and live-streaming. The Nasdaq-listed company had first mover’s advantage in the online dating market, allowing users to connect with others in the same location and share free texts, audio notes, and photos.

Like many other apps, Momo enjoyed significant initial user growth, reaching 10 million users in a year but lately has been struggling with a long-term decline in revenue growth. In its Q3 2020 earnings, the company reported a decline in revenues by 15% year over year to 3.7 billion yuan ($572 million), and monthly active users were 113.6 million in September 2020, compared to 114.1 million in September 2019.

Nasdaq-listed internet security software firm Qihoo 360 launched its mobile messaging app Kouxin (口信) in September 2011, allowing Android, iOS and Symbian smartphone users to send text messages, voice messages and pictures for free. However, without an established user base and high switching costs, the app received little fanfare.

On Jan. 15, 2019, three messaging apps were launched on the same day, each believing they could take a share of the social networking pie: a revamped version of Smartisan-backed Bullet Messenger, ByteDance’s Duoshan, and Matong, which actually translates to Toilet.

Matong (马桶), a privacy-focused messaging app claiming to be the “anti-WeChat”, features anonymous communication features developed by Shenzhen-based Ringo.AI, whose founder Wang Xin launched just three weeks after finishing a 14-month prison sentence for the distribution of obscene materials via his last app Qvod.

The app, which allows users to post questions anonymously, had seen bursts of user growth but had little potential for monetization, eventually relaunching as an e-commerce app calledHaoji (好记) four months later in May 2019.

Matong, which means toilet, allows users to post questions anonymously. (Source: Sina)

ByteDance’s Duoshan (多闪), a Snapchat-like video-based social messaging app, is the company’s first attempt at challenging Tencent’s social messaging dominance. The tool is essentially an extension of its massively popular Douyin, or TikTok, allowing users to send short video messages to each other that will disappear after 72 hours.

Targeted at young Chinese users born after 1990, the app does not publicly display likes or comments for the purposes of “reducing social pressure and providing a more relaxed environment for social networking,” the Beijing-based firm said at its launch. It immediately racked up more than 5.06 million downloads from Apple’s China App Store in a month.

The biggest WeChat challenger was perhaps Bullet Messenger (子弹短信), developed by start-up Beijing Kuairu Technology and backed by internet celebrity Luo Yonghao’s Smartisan Technology.

The app had some highlights during its short-lived fame. Within a week of its debut in August 2018, the company completed a round A financing of 150 million yuan ($23 million), with a daily download volume of 440,000 and 4 million active users.

At the time, it had some key functions that distinguished itself from WeChat, including human-like interactions, a “remind me later” organizer, and its well-developed automatic transcription feature that turns voice messages into text.

Bullet Messenger, later revamped as Liaotianbao, was touted by Chinese media as the biggest challenger to WeChat. (Source: Ejinsight)

However, basic functionality problems plagued the fast-rising app, and the young and inexperienced team struggled to deliver. Numbers plunged quickly in November 2018, and the app underwent a major overhaul and relaunched in January 2019 as Liaotianbao (聊天宝). The app provided cash and virtual currency incentives for users who take certain actions on the platform.

However, the strategy, clearly targeted towards lower-tier cities in China, was off-putting and appeared desperate to users, which eventually deserted the platform. User growth slumped, and the company announced that it would pull the plugs off its Liaotianbao on March 5, 2019.

The Test for WeChat Lies Ahead

“If I have to use two words to describe WeChat, it’ll be ‘connectivity’ and ‘simplicity’,” Zhang said in a two-hour speech at WeChat’s 10th anniversary developer conference last Tuesday.

He also announced WeChat’s ramped up efforts into the video segment, emphasizing that short-form videos — both for self-expression and media consumption — will become dominant on platforms in the next decade.

Contrary to imitating competitors Douyin or Kuaishou’s business models that rely on machine algorithms to recommend videos, Zhang said WeChat’s video-sharing portal Channels will deliver content through contacts sharing. This contributes to what is known as “private domain traffic” (私域流量), a marketing method where communication with customers is funneled into closed channels and private forums on platforms. These platforms usually include WeChat official accounts, personal accounts, WeChat friends’ circles and groups.

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The company now has nearly 200 people working on the product, growing from just around 20 when it started, he said.

Zhang Xiaolong announced the platform’s ramped up efforts into the video segment at WeChat’s 10th anniversary developer conference last Tuesday. (Source: Tencent News)

Analysts Pandaily spoke to said the less-popular messaging apps struggled to bring any new innovations to the market, contributing to the “inevitable success” of WeChat, which already possessed a large initial user base from QQ.

“Given that WeChat remains, far and away, the most popular and widely-used messaging app in China, it’s hard to imagine another app that could come along and break its stranglehold on the market,” Sawyer Zhao, Operations Associate from AppInChina, a company that helps foreign app developers enter the China market, told Pandaily.

“Messaging apps depend on widespread use for their success, and nobody likes bouncing between apps to send simple messages to friends,” he said.

Any new player that hopes to beat WeChat and disrupt the market will need to be completely different, Zhao added.

“At this moment, with WeChat’s already-established popularity, it’s hard to believe anything will come close to dethroning it from its perch. No other app besides Tencent’s own QQ comes anywhere close to its market saturation,” he said.

WeChat’s way forward is fairly clear, though it may not be free of obstacles.

Last November, the Chinese government sent a warning to the nation’s tech giants by issuing wide-ranging guidelines against monopolistic practices and anti-competitive behavior on the internet.

ByteDance’s public accusation of Tencent blocking Douyin and its cloud office suite Feishu on WeChat may trigger increased scrutiny on the firm, which was fined 500,000 yuan ($76,000) in December for not properly reporting past deals for anti-trust reviews.

Despite knowing its dominance in China’s social networking game and Zhang insisting he doesn’t think about the competition, WeChat has never been complacent. From rebuilding its search engine to expanding its short video and live-streaming offerings, the next 10 years will see the super-app bring even more innovation to its 1 billion users, especially for China’s younger generation.