Business
Is There Room For Any More Instant Messaging Apps in Africa?
World Wide Worx expects WeChat’s market penetration to reach 13 percent this year. Nonetheless, Tawanda Chitaka, the 29-year-old CEO of TanaMe in Zimbabwe, believes he and other African start-ups may ultimately have the upper hand. “We have an advantage because we’re on the ground,” he told AFKInsider in an interview facilitated, begrudgingly, by Skype (he uses it only when he must, he says). “When you come down to Africa, it’s a different animal.”
He points to Viber to prove his point. It relies on fast, strong internet connections for high-definition phone calls. But in Africa, good connections are scarce, and so are Viber downloads. “HD voice is a nonstarter,” Chitaka says. Being on the ground also gives him the know-how to score better rates from service providers. A call from the U.S. to Zimbabwe can cost as much as 33 cents per minute on Skype — double the TanaMe rate.
Until recently, though, TanaMe has focused almost exclusively on India, where the majority of its 20,000 users reside.
For TanaMe and others like it, earning active users means spending as much as possible on online advertising — which isn’t very much compared with the industry giants. In 2013, the owners of WeChat, for example, spent $200 million on foreign advertising. Amazingly, this kind of spending on ads and acquisitions has only encouraged the start-up entrepreneurs. “The recent acquisition of WhatsApp shows the potential in the IM market,” Saya’s Badu Boahen told AFKInsider in an email.
Arthur Goldstruck, however, makes his money on analysis, not optimism. He’s the head of World Wide Worx, the tech research firm. On the question of whether there’s room in Africa for so many chat apps, his view is twofold and possibly contradictory. One: “There’s always room for a newcomer that offers something different and does it well and two: “The Facebook / WhatsApp coalition is just going to be too formidable for little guys to compete.”
Copyright AFK Insider 2014
