Is Facebook drawing inspiration from Asian messaging apps?


Facebook has made some significant moves recently in the mobile world — releasing a Snapchat competitor in Slingshot and hiring away David Marcus from PayPal to lead mobile messaging.

As Marcus’ hiring leads many to see a time when Facebook users can someday send money through Messenger, Tango Chief Technology Officer Eric Setton notes that several Asian messaging apps have already mastered the frontier of maximizing time spent on mobile, as well as monetization. He talked with Inside Facebook recently about how Marcus’ hiring signals that Facebook may start borrowing traits from apps such as Tango, WeChat and Line. Tango is a messaging app with 200 million users — 70 million of which are in the U.S., Setton says.

Inside Facebook: What do you think the hiring of David Marcus means for Facebook?

Eric Setton: The way I see it, Facebook is finally noticing and can basically not ignore the innovation happening in other services … and will have to play the game and have to open the platform on the messaging side as well. I don’t think it’s a coincidence that David Marcus has such a strong expertise in payments. If you have an app that people check 30 or 40 times a day, that’s a great opportunity to be able to connect you to more things. I think this is a great bridge to commerce and distribution at large.

I think it makes a lot of sense to have such strong groups in mobile payment be able to come in and contribute. I think that this signals, to me, the first step in the evolution of that thinking.

IF: Are there apps out there that do allow users to send money back and forth?

ES: In China, there’s a mobile messaging service called WeChat … that is basically becoming the mobile destination or entryway to the internet for Chinese users. It combines messaging with the kind of features that Facebook also has on the social networking side and they integrated payments about a year and a half ago. It was a huge success. They started by allowing people to send money to each other. Soon enough, it branched out in a lot of different ways. On WeChat, you can call for a taxi and pay for it. You can order dinner, if you want to.

What’s interesting is that commerce is right around the corner.

Very similar things are happening in Korea and Japan. I think that messaging services are starting to be the powerhouses of distribution. We’ve opened up our platform to mobile games, as well as music services like Spotify. By allowing people to have these social experiences where you can send a song to your loved ones or you can play games together with your friends by using the platform to communicate or compete. Over time, you’ll discover new things with your friends.

IF: I know that both WhatsApp and Facebook have agreed to leave WhatsApp alone and let it grow, but when it does come time to monetize, do you feel that they will borrow from some of the successes of these messaging apps?

ES: It’s very difficult for me to imagine that it’s not going to be the case. I’ll make one small caveat here: I don’t know if there’s anything that they had to promise to make the deal come through. Except for that, first of all, the network is what drives these services and puts it all together. It’s definitely something that’s a strength.

(Facebook) has been very focused on monetization. I’ve read the stories about how organic reach is dwindling, but the paid reach is still extremely strong. There has been a lot of focus on that in the past few years. A company like Line, that is centered around mobile messaging, is making over $500 million this year, and a good chunk of that is mobile gaming.

We’re starting to see serious numbers here. I think the pressure to show growth, both on the revenue side and the engagement side, will definitely push them toward that. It’s something that is so natural. We’re just following suit and making this available on mobile. For the time being, I think Tango’s happy that we have this window of opportunity where we’re the only large mobile messaging platform to offer these types of distribution mechanisms to reach Western audiences. I’m in no rush to see that happen. I think it will happen, but for now, we’re enjoying the fact that we’re open for business, and they’re not.

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