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Does Facebook have ambitions in payments?

Pamela Clark Dickson, Principal Analyst, Consumer Services at Ovum | March 27, 2015
Facebook’s Messenger Platform takes measured steps towards a richer user experience

Facebook used its F8 developer conference to announce two significant developments for Facebook Messenger: the introduction of the Messenger Platform and the preview of Businesses on Messenger. Together with last week's announcement that the social network had added a P2P payments capability to Facebook Messenger, the F8 news confirms Ovum's long-held view that Facebook Messenger is aiming to become Facebook's key mobile platform for content and commerce as well as communications. This is as opposed to Facebook's other mobile messaging services, WhatsApp and Instagram; WhatsApp has consistently stated that it does not intend to become a platform for content delivery, while Instagram has remained tightly focused on the sharing of photos and videos.

 Facebook's decision to open up its APIs to Facebook Messenger to third-party developers for the creation of content and apps is a vital step in the evolution of the messaging service which has, to date, lagged behind competitive offerings from the likes of Line, Kakao and Tencent (WeChat). Ovum understands that, despite monthly active users now standing at 600 million, user engagement with Facebook Messenger has fallen since the decoupling of the mobile app from the social network in 2014. By making the Messenger Platform available to developers for the creation of apps that are designed to enhance the user experience, Facebook aims to once again increase engagement.

The apps that are initially available via the Messenger Platform are still quite limited by comparison to those offered by Line, Kakao and WeChat, in that they are mainly focused on enabling Facebook Messenger users to add GIFs, photos, videos, audio clips and content to their messages. It's likely that Facebook has chosen to limit its initial offerings in order to gauge the extent to which such services will be popular globally; it's also possible that the social network will provide localized apps at a later stage. However, it's still a solid start for Facebook, which states that it already has more than 40 developer partners for Messenger Platform, including ESPN, Giphy, JibJab, Meme Generator, Stickered, The Weather Channel and Wordeo.

 Given Facebook Messenger's 600 million MAUs - an increase of 100 million since November 2014 - Facebook will have no shortage of interest from developers, which means that it won't be long before there will be a substantial expansion in both the number and the types of apps that will be available for Facebook Messenger. Developers will be able to tap into a viral marketing capability via the platform - a message that contains content from a third-party app will also include information about the app and an install button. A key challenge for Facebook will be ensuring that the apps that are associated with the Facebook Messenger platform are high-quality apps that will engage the interest of users.

 

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