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Phone-Based Message Apps vs. Identity-Based Message Apps

Stocks in this article: BBRY AAPL FB BIDU AMZN

Wenger says:

Because phone number-based messenger apps can bootstrap very rapidly off the graph that is contained in people's address books.... The UIs of all of these apps are virtually identical and are also extremely similar to the basic SMS UI that everyone around the world knows and understands. The combination means there is virtually no enduser lock in at the messaging layer.

I think most of us get the "no lock-in" aspect of traditional messaging apps. But why is this different for identity-based services?

Well, if they are a service that allows for third parties to integrate into, there can be much more personalization and notification services built on top of the messaging layer -- which then really becomes just a basic underlying service. Messaging is the commodity. The lock-in happens in everything you do on top of the messaging.

In the case of Kik, you can play games with your friends and search for other Web pages within Kik's own search box.

Why does this matter? Hamish McKenzie had a great post in Medium earlier this month in which he said:

It doesn't take much imagination to see where this is going. Payments. Peer-to-peer transactions. Online shopping. Ad networks. One-to-one connections between brands and consumers. It stands to be a true expression of a social network for the mobile era. Kik now has all the necessary layers: identity; reach (more than 100 million registered users) and, crucially, the HTML5 platform.

Tencent is already well down this path in China right now. As McKenzie says, the race is on now to try and replicate Tencent's success in the Western world. Kik is now putting the pieces together. BlackBerry's BBM could do this, too, if it keeps its growth rate high in emerging economies.

Although the world has yet to take much notice, the growth of these identity-based messaging apps could be much more threatening to some big players as time goes on.

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