NEW YORK (TheStreet) -- There's an interesting post by Albert Wenger of Union Square Ventures on his Tumblr blog. It's about WhatsApp and Facebook (FB). Albert thinks Facebook "massively overpaid" for WhatsApp.
That's not the interesting part to me. I disagree, although I think he's got some interesting points to consider such as his line: "How many times can you take out a threat at 10% of your market cap?" (And there are lots more threats coming to Facebook, to be sure.)
I think the most his interesting point is a discussion of the switching costs of phone-based messaging apps vs. identity-based messaging apps. This hasn't been discussed at all -- from what I've seen -- in any articles or blog posts in the wake of the WhatsApp deal.
For those not aware, WhatsApp and many messaging apps are based on your mobile phone number. You are identified through that number in the WhatsApp service. Identity-based messaging apps include China's WeChat and Kik. They ask you to pick a name to identify yourself, instead of using your phone number. I guess you could also include BlackBerry's (BBRY) BBM in this group because it identifies you through your PIN and not your phone number.
To some, it might not seem like there's much difference between the two approaches. I use my name (or PIN) for one type of app while I use my number for another. So what?
Let me repeat the key point: The switching cost for users on a phone number based messaging services is at or near zero (this is different for identity based services and even more so if they are a platform that third parties can integrate with such as WeChat and Kik -- the latter is a USV portfolio company).
He also discusses how the Telegram Messenger app has exploded in popularity in the last few days since the WhatsApp deal was announced. It's a messaging app started by two Russians behind Russia's version of Facebook who decided to start a messaging app that put a big emphasis on security. The other day, Telegram tweeted that it had signed up five million users in one day.
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.
Today, Apple (AAPL) and Google (GOOG) play a major gatekeeper role for apps with the App Store and Google Play store. Facebook seems to have been partly motivated to buy WhatsApp because it feared being pushed off to the side from "controlling" the mobile experience thanks to the gate-keeping positions those companies have. (Facebook Phone didn't get the company where it wanted.)
The silo app structure of mobile today also serves the incumbents. If HTML5 truly takes off in the way that Tencent and Kik want, the gate-keeping role will pass to them from Apple and Google (or in China, one of the big gate-keepers is 91Wireless owned by Baidu (BIDU)).
It's these new gatekeepers that really become your mobile browser in the new non-siloed world. They get a piece of payments, e-commerce, ad networks and search instead of PayPal, Amazon (AMZN) or Google.
The differentiation will come from getting the starting place app that everyone wants and then building lots of hooks into your other daily habit apps so you actually never have to leave your main app.
At the time of publication the author is long BBRY.
This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.