Line – The young contender.

Line is making its bid for the big time.

• Line is a competitor to WhatsApp and other IM applications that differentiates itself by allowing users to exchange cutsie cartoon images.
• Line was developed in Japan and Korea where the cutsie cartoons are an integral part of everyday life.
• Line has recently expanded into Western countries and incredibly has met with substantial success.
• The last time I wrote about Line, I assumed that what had happened in the past with Asian exports would happen once again but I got this one wrong.
• History is littered with the corpses of Asian internet and mobile services that have tried to expand outside their regions but something about Line is appealing to users in the West.
• Line is now taking the next step and expanding its application to cover other activities in Digital Life.
• Instant Messaging is a popular activity but users only spend 5% of their time on smartphone engaging in this activity.
• Furthermore, instant messaging is now a crowded space meaning that revenues and profits will be increasingly difficult to find.
• To counteract this Line has added a browser inside the application itself.
• Now when one shares a link the webpage opens as part of the Line experience rather than going to Safari, Chrome or Firefox.
• Users spend 13% of their time on smartphones browsing the web meaning that Line has just increased its addressable market from 5% of user time to 18%.
• In my view, expanding coverage of user activity on smartphones is a critical step to achieve growth and success.
• The better one covers Digital Life, the more one knows about one’s user and the more valuable will be the targeted advertising.
• Furthermore, the more time a user spends using one’s service, the more opportunities one has to target that user with advertising.
• Hence increasing coverage of Digital Life is good for both pricing and volume.
• This is why coverage of Digital Life is an essential piece of Radio Free Mobile’s analysis of mobile ecosystems. (see here)
• At this time it is impossible to know whether the browsing experience is any good but this is a strong signal of what Line intends to accomplish in the long-term.
• This is a very long way from becoming a fully-fledged eco-system, but if it can successfully offer its users other services there is potential for it to gain momentum.
• The big players will probably fail to even notice Line’s move, but the likes of FaceBook and Twitter, who need to expand their offering beyond their respective niches, should pay attention.
• I underestimated Line once. I am not about to repeat that mistake.