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The Way In Which Apps Like WhatsApp, WeChat Could Make Money While Providing Free Texting And Callin
  • Ever wondered just how a messaging app can make money whilst providing free texting and calling? WhatsApp users in India may be surprised to discover that there are more to messaging apps than communicating. Here is how: by offering services for example digital payments, online shopping and content.
    China's WeChat is probably the ultimate example of the great potential which messaging apps hold. With well over 900 million monthly active users, WeChat assists them to do everything from messaging, purchasing grocery, hailing cabs, buying online food as well as offline payments at restaurants - all this without having to go to another app. These kinds of services not only provide the company outstanding customer stickiness, they also create a exceptional revenue model.


    Right now, WeChat's competitors outside China this includes WhatsApp, Facebook Messenger, Skype, Viber and Line are behind the curve on this front, even though some have begun on the way to becoming greater platforms. "The actual reason chat apps are growing beyond communications is to build a sustainable monetisation strategy," said Neha Dharia, a senior analyst with a focus on messaging at London-based research firm Ovum. "Chat apps are shifting from being just a provider of communication tools chat, voice and also video) to becoming a platform for the exchange of services, payment mechanisms and also content consumption."
    WhatsApp, the largest messaging app in the world with 1.3 billion monthly active users, introduced a business version in India early this week. "Based on research, we know that people WhatsApp to speak with businesses.
    Make business messaging less difficult for folks and more effective for businesses," a WhatsApp representative said in response to ET's questions. Whatsapp Business is a different app from Whatsapp Messenger, aimed largely at giving a direct communicating platform to smaller businesses, many of who may be using WhatsApp already.

    Whilst Whatsapp has kept the service free, it may broaden it to much larger businesses with added features such as analytics, by which it may well demand a usage fee at a later stage, therefore making a revenue model, segment watchers said. This actually also is targeted at increasing subscriber connect which it can leverage for future monetization of its other services. The bigger agenda - and a more critical one - for these businesses is to get active users to spend far more time on the app or services and also make it viable for revenue generation, according to specialists.
    "Each technology company is competing for consumer stickiness, interaction along with time spent on the app, and in order to keep them in the app's ecosystem they are widening themselves to turn into platforms. Just being messaging Alternative App offering cost-free services will not be a good revenuegeneration model," said Jayanth Kolla, founding father of Bengaluru-based research firm Convergence Catalyst.