ALJAZEERA
Elon Musk has indicated his desire to transform X, the microblogging site formerly known as Twitter, into an “everything app”.
In a post explaining his decision to dump the Twitter name and bird logo last week, Musk said the rebranded platform would be expanded to offer “comprehensive communications and the ability to conduct your entire financial world”.
Musk’s plans appear to take inspiration from the Chinese super app WeChat.
WeChat, which combines social media, digital payments, internet browsing and more into a single app, has become a ubiquitous part of daily life in China since its launch by tech giant Tencent in 2011.
How did WeChat become a huge success?
WeChat was successful in China for a variety of reasons, but key among them was the timing of the launch.
In 2011, China only had 485 million internet users in a population of 1.3 billion people due to limited infrastructure and a large rural populous. The country also had limited credit card penetration, with many people relying heavily on cash. The highest denomination at the time was 100 renminbi, worth roughly $13.
Enter WeChat and similar rival apps that allowed users to access payment services and other features on their mobile phones. Chinese users could suddenly “leapfrog” the era of desktop broadband straight into smartphones and apps, said Kendra Schaeffer, Head of Tech Policy Research at Trivium China.
“[WeChat] filled a social economic contextual need. Simply picking that up and replicating it here isn’t necessarily going to work,” Schaeffer told Al Jazeera, referring to the chances of success for an “everything app” in the United States given the country’s very different internet landscape.
The US internet ecosystem in 2023 is much larger and more fragmented than China’s in 2011.
The market is also far more competitive. Musk’s super app will have to contend with the likes of TikTok, which wants to launch an e-commerce business in the US, and the ubiquity of Google Pay and Apple Pay after the COVID-19 pandemic.
Schaeffer said Musk will need to find a way to integrate a payment platform into his super app – the “secret sauce for success” – if he wants his app to succeed. This would free up users from clicking on third-party links, but such integration has so far eluded US developers.
“Chinese apps as a whole had figured something out and have executed on one particular thing that no US apps have ever done. None of the big US platforms have managed it, which is containing payment and shopping features in a social platform. We just haven’t succeeded at that,” Schaeffer said.
How was the Chinese government instrumental to WeChat’s success?
Super apps like WeChat have succeeded in part thanks to the support of the Chinese state – a powerful force that is difficult to match in a US or Western context.
Beijing has banned foreign platforms such as Facebook, Twitter and YouTube and endorsed local apps like WeChat that lend themselves well to social control and government censorship.
Most Chinese government departments and local authorities operate WeChat accounts as a way to disseminate information – which recently included a call for citizens to join counter-espionage efforts and report suspicious activity.
“Few things survived the fad of Chinese digital transformation, but super-apps like WeChat integrate well with the state’s ambition of organising all aspects of the citizen’s life for political control,” Kitsch Liao, an assistant director of the Atlantic Council’s Global China Hub, told Al Jazeera.
What other challenges does Musk face?
Musk’s ownership of the social media platform once known as Twitter has been tumultuous.
After purchasing Twitter for $44bn last year, Musk fired more than three-quarters of the company’s employees and introduced changes to moderation that have been blamed for a rise in hate speech on the platform and an exodus of advertisers. The company’s subscription-based Twitter Blue service has struggled to attract subscribers, while the rebrand to X has been widely panned.
Last month, the billionaire CEO of Tesla and SpaceX admitted the company’s advertising revenue had plunged about 50 percent and cash flow was negative, despite earlier predictions the company would break even by this year.
As Musk tries to take X to the next level, there are technical challenges to consider, too.
Musk will need to figure out how a presumably US-based super app would work on the back end, said Liao, including handling issues such as currency choice, consumer data protection and privacy – especially if the app were to operate on a global scale like Twitter.
US tech giants such as Meta and Google have already landed in hot water in the European Union over consumer data protection concerns and anticompetitive practices.
It is unclear whether Musk’s “everything app” would only launch in the US or take on multiple regions at the same time. WeChat has limited use outside China and has the advantage of only having to answer to one government in Beijing.
“It has not been made very clear amongst all these concerns that this is a promising or viable model for the more liberal and consumer-rights oriented Western markets,” Liao said.
