Microsoft: Rumors of a Super App in Development
TikTok, Twitter 2.0 and now Microsoft?
Hey Guys,
The Information is bringing us more inside scoops and I like this one. Microsoft recently considered building a "super app" that could combine shopping, messaging, web search, news feeds and other services in a one-stop smartphone app, in what would be an ambitious move by the software giant to expand further into consumer services, The Information reported Tuesday, citing people with inside knowledge.
Elon Musk of course plans to make Twitter 2.0 a Super-app of some kind, though it’s not yet clear how realistic that endeavor is. China has had super-apps with mini-programs for years and even South East Asia notably in South Korea and Indonesia have them too.
In the U.S. with monopoly capitalism the incompetence of Facebook and Google mean we haven’t had the convenience of having super-apps. PayPal for a while was rumored to be in the running to build one, but has not been able to achieve anything remotely like that. When Uber built Uber Eats it looked promising, still nothing compared to Meituan or other Chinese versions of the same thing.
There’ been a lot of speculation as TikTok enters E-commerce in the U.S. if it will be the next Super-app in the United States. That Microsoft is interested in developing something like that isn’t surprising given the lack of real Western traffic on LinkedIn. The weird part is how bad the West is at copying China, with Facebook cloning TikTok or there being no mini-programs in Western apps that even approaches the levels of convenience and utility.
Snap could be acquired and turned into a Super-app relatively easily by Amazon, Apple or Microsoft if they so wanted. Elon Musk acquiring Twitter for $44 Billion says more about information control for the Billionaire class than it does about the state of free speech or innovation of a Silicon Valley in a steep decline. Just look at these layoffs.
Since Microsoft acquired LinkedIn, it’s been a bit painful to watch. While Microsoft has built Teams on the other hand to pretty dominant levels, though with its unfair advantages of pre-existing software and vendor dominance. If anyone could do it, it would in theory be Microsoft due to how monopoly-capitalisms is playing out in the U.S. It would also help Microsoft to get better in digital advertising, which it needs to do already with Azure as a Cloud leader, currently just behind Amazon’s AWS.
I share skepticism that the West is capable of building a Super-app, however Microsoft has shown some potential when it realizes the importance of a project like it did with Microsoft Teams during the pandemic. Microsoft has matured wildly in recent years with Azure and with its Generative A.I. advantage in the commercialization of GPT-4, yet to be announced, having a Super-app would be useful.
Offering news, search, shopping and messaging in a single app could help Microsoft expand further into consumer services and compete with Apple and Google.
TikTok’s ability to scale social commerce in the West in E-commerce is also highly doubtful even as it explodes in mobile native Indonesia among other places. In China Douyin has done well with the approach. The attempts of Google, Meta and Microsoft to get into consumer-retail have been laughable over the years. Microsoft should have had the sense to acquire Shopify when it was smaller.
A super-app typically allows users to do many things including typically:
Payments
Utilities
Ride hailing
Food ordering
Access mini-app capabilities
Access News services and reading
It’s not just WeChat, like I’ve mentioned before. It’s Meituan, Kakao Talk, Grab, Douyin and so many others. I had always hoped Ant Group would turn into a Super-app. At least that made sense, but Microsoft? Microsoft is mostly a B2B company, it’s consumer business outside of gaming in terms of app products, never felt that great.
Microsoft wants to “emulate a mobile strategy that has worked for Tencent,” referring to the company’s WeChat app. It’s unclear to me how it would go about accomplishing this, but now with a viable gaming business, Bing and LinkedIn’s suite of services including LinkedIn Learning, it could certainly try to bundle those things in an app. But what would be the unique value proposition, Teams? I just don’t know.
However, The Information also said it wasn’t clear if Microsoft will actually launch the app. At the very least, it appears to be something the company has considered internally. So it is rumor, speculation or just some clickbait for The Information, it all remains to be seen.
Not Microsoft but Apple Should Make a Super App
If anyone should develop a super-app it’s actually Apple. Apple is a more trusted company with a more definable walled garden and moat with the iPhone. Apple Services could be bundled into an app, and something like Amazon Prime could be created, it would actually make sense.
In the fourth quarter of 2022, Apple generated a total of 19.19 billion U.S. dollars in services revenue.
That potential it’s being fully leveraged without a super-app, in my opinion. Even with the dominance of the iPhone and iOS Apple store and these incredible gateways to Apple services, it’s still limited by device hardware in a closed ecosystem. A super-app would enable Apple to be a more open hub.
For Microsoft however, a super-app could enable it to improve its gaming sector, LinkedIn growth, advertising and even how it offers Teams, cybersecurity services and other A.I. products from Azure. In theory I can see how an all-in-one app that drives more users to Bing and other Microsoft services could help the company better compete with Apple and Google in the consumer services market as well as in mobile search. For either Microsoft or Apple, the main advantage to having a super-app, is to grow their advertising business, something both of them are going to do from 2023 to 2030 at an incredible pace. They will want to follow the footsteps of Amazon even as Meta declines in its Advertising duopoly with Google.
The rumor and speculation is at least fun to think about. On Apple platforms, Microsoft’s Bing is at an inherent disadvantage because of a multibillion-dollar deal between Apple and Google. Through this deal, Apple makes Google’s search engine the default on all of its platforms. Even as LinkedIn has many ways in which to make revenue, it’s not a great consumer experience: this LinkedIn app. It’s bloated with features that are often hidden under some obscure tab. It’s feed is super cringe.
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