UPDATED 12/4: NTT Docomo, KDDI and SoftBank teamed up to develop a new messaging service which allows users to send photos, movies, stickers, voice messages and group chats.
Atul Goyal, an equity analyst at Jefferies Singapore, said in a research note the +Message service is positioned to compete directly against the popular Line app, which is a near-monopoly messaging platform in Japan. The service conforms to Rich Communication Services (RCS) standardised globally by the GSMA.
The app is scheduled to launch on 9 May. In addition to Japan, the new service will also launch in Taiwan, Thailand and Indonesia – all major Line markets.
“Even if one assumes Line may remain the bigger of the two, there is no denying it may have to compete to retain those customers…Line’s market cap is about $9 billion and the combined market cap of the three companies sponsoring +Message is more than $200 billion. Their marketing budget is likely to be much bigger than that of Line. It does depend on how aggressive the three carriers are in promoting their services and how much money they spend on customer acquisition. But there is no doubt that this will put immense pressure on Line to defend its position in Japan,” Goyal said.
The three operators issued a joint release about the new platform, which supports up to 2,730 characters per message compared with the maximum of 70 characters per SMS message.
Goyal said 73 million of Line’s more than 200 million monthly active users are in Japan. He noted the three mobile operators can combine to offer incentives to urge users to switch to +Message, and these promotions, if tied to usage, could impact usage on Line.