LINE Corp., a South Korean-owned firm that operates a popular mobile instant messaging app, plans to launch stickers proactively and enter into tie-ups in order to gain market share in China, taking on the Weixin services of Tencent Holdings Ltd. (00700.HK).
Chief operating officer Takeshi Idezawa is optimistic about the prospects for China market, and is also unfazed about the competition, the Hong Kong Economic Times reported Tuesday.
“There were a lot of competitors when we launched LINE in Japan, but we could still stand out. It was a similar case in Taiwan and Thailand,” he was quoted as saying.
“Not only LINE, other telecommunication service providers are also eyeing the [China] market, as it is expected to see a rapid increase in the number of users with the rapid growth of online game market in the country in the next ten years,” he said.
In April, LINE entered into a cooperation deal with Chinese app distributor Wandoujia. Under the deal, Wandoujia will provide technical support for LINE’s service in the mainland and the two parties will also team up to strengthen the localization content and operation of LINE and achieve synergy of the two brands and platform.
“Weixin and LINE are similar in terms of service and the growth in user numbers, but LINE is relatively simple and it can be used on personal computers and mobile phones, while the other application is only available on handsets,” Idezawa said. Webpage version of Weixin allows users to chat but not for playing online games.
Weixin is also upgrading its service. Tencent has set up an individual department for Weixin that will responsible for the platform, mail, payment and online-to-offline business development, NetEase reported in early May. Allen Zhang, senior vice president of Tencent, is in charge of the Weixin department.
LINE messaging app is said to have brought US$338 million in revenue for its parent company last year. Of LINE’s total revenue of US$506 million, 20 percent came from sticker sales while games contributed 60 percent. The rest was from corporate accounts. The application has more than 420 million users across the globe, with 51 million from Japan.
Tencent had total revenue of US$9.9 billion in 2013, up 38 percent from a year earlier. The securities arm of HSBC Holdings previously estimated that the valuation of Weixin would reach US$65 billion, way higher than Facebook’s acquisition on Whatsapp at US$19 billion, Economic Times said.
As the business of LINE has grown, the company is inviting users to create new stickers on a Creators Market platform that was launched last month. “With this new platform, localized stickers can be designed with this platform as we might not be able to take care of all the design on stickers,” Idezawa said.
The platform has 30,000 registered users in Japan, Taiwan, Thailand and Indonesia.
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