Is There Room For Any More Instant Messaging Apps in Africa?

Written by Ben Wolford

The developers of Saya call their Ghanaian chat app the “SMS killer.”

Meanwhile, an app called TanaMe is fighting for a niche by aggressively undercutting Skype prices in Zimbabwe.

And one CEO from Nigeria is so committed to his infant chat start-up that he’s funding the entire endeavor with the salary he earns from his day job at Ericsson. “I don’t sleep,” he says.

Unlike in the United States, where unlimited calls and texting are typical of phone plans, in Africa, these can be relatively expensive. Data packages, on the other hand, give even some basic mobile phones access to the internet’s vast array of communication options, many of them free.

In the last few years, tech powerhouses and starry-eyed entrepreneurs have rushed to battle for the multiplying user base of mobile instant messenger apps. So far the champion, with 11 million users in South Africa alone and 450 million around the world, is WhatsApp. On Feb. 19, Facebook purchased the Silicon Valley company and all those users for $19 billion.

“That is why I am still awake,” John Enoh, 33, told AFKInsider after taking a call past midnight recently. It was a work night, but Enoh, who is from Nigeria and works for Ericsson in Dubai, says he is deeply invested in his start-up, a chat app called Beeptool. Since founding the company in November 2011, he has accomplished the first phase: launching Beeptool on the iOS, Android and BlackBerry platforms. The next step is to lure users.

The final step, which he admits is ambitious, is to revolutionize internet use in Africa by partnering with internet-service providers and expanding wi-fi hotspot locations.

“The major vision is to make sure that Africa has a free communication tool … by making internet available for people to use.”

All of that, Enoh says, could be worth “in the order of $19 billion.”

AFKInsider identified about 11 Africa-made mobile phone applications dedicated solely to instant messaging, but it’s likely there are many others fighting for market share. In one sense, they’re fighting for scraps: much of the market is already dominated by WhatsApp — or some of the other big South African companies, Mxit and 2go. The latter has become so popular in Nigeria that a bakery has reportedly co-oped the 2go logo for the packaging on its loaves of bread.

“We Are On The Ground”

Until just last year, Stellenbosch-based Mxit boasted more users in South Africa than Facebook. It remains a heavyweight in the chat app industry, according to a recent report from the tech analyst firm World Wide Worx. And aside from WhatsApp, other international powerhouses have bet millions in advertising on African ventures — namely, a Chinese service called WeChat. 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.”