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So TikTok got banned…. and a host of platforms ‘inspired’ by TikTok are rushing to take its place. This includes — Instagram — with its newly launched ‘Reels’. But the would-be usurpers will find that taking over the space created by the ‘world’s most valuable startup’ — will not be easy. But the world of social media is a fragmented one.
Facebook still enjoys a massive lead — but it’s cluttered and suffers from a lack of a clear call to action — are we there for our friends or just to watch random cat videos?
Platforms like TikTok and Helo may be banned for now, but they’ve made a big dent in the digital world. For a time — TikTok even surpassed Instagram in terms of total downloads (and engagement).
For those who think that Instagram reels will somehow replace TikTok — keep in mind that people chose to use TikTok. Instagram was already there. It just didn’t feel like home for hundreds of millions of Indians & people around the world.
Helo and Likee — companies that few people bother to mention in the same breath as Facebook, Instagram, Twitter, TikTok and Linkedin are significant players as well.
For context — Helo alone has more downloads in India than Twitter and Snapchat put together; and Likee till recently was bigger than Snapchat, Mitron, Chingari and Roposo combined. Even post the ban, people continue to find ways to use these apps (probably via VPNs).
And their engagement ain’t something to be scoffed at either. Till the ban came into effect — people were spending an incredible amount of time in this ‘new world’.
Why is this important? People were spending nearly 2X the time on TikTok than they did on Instagram — in fact, TikTok even surpassed Facebook!! How’s that for engagement?
Even Likee an App that no one really talks about in the chaos of digital ‘bannery’ was seeing more engagement than Instagram when it came to time spent on the app.
This is a paradigm shift; it threatens the monopoly that American Media companies like Facebook and Google have enjoyed — in India and the world.
According to BloombergQuint with over 1.3 billion people and ~500 million internet users, digital advertising in India — the fastest-growing advertising market in the world — is expanding at a faster pace than any other medium. So, it should come as no surprise that the American government is in support of the ban.
It’s ironic that just over 40 years after banning Coca-Cola for refusing to share their formula — the Government of India has found a supportive ally in America while banning Chinese Tech firms.
As entrepreneurs, marketers & investors — we should have welcomed competition instead of gleefully endorsing the ban. We are the people who spend marketing dollars online, competition creates quality — it lowers the cost of advertising (CPM rates) and forces these platforms to improve performance. In the absence of competition — a few large media conglomerates have more pricing power than they would otherwise.
Companies spend more to acquire the same users and have less left over to reinvest in operations. Ask any entrepreneur — they’re always fighting the LTV vs. CAC battle.
Ironically, protectionism was the panacea of Indian industry for many decades till liberalization rescued them from despair. It took a combination of political will, economic crisis and lobbying by industry to open Indian markets. Arguably, we are all beneficiaries of that liberalized India.
Now a new breed Indian industrialist (albeit digital ones) are celebrating new protectionism — one that makes it harder for Chinese Companies and Capital to enter our borders.
I know there are multiple facets to this argument, but it’s a slippery slope and India needs access to Chinese markets — not just for good & services but capital too. We should welcome the competition; how else will we build world-class companies? Find cheaper advertising avenues…
It’s worth noting — we also need competition among the providers of capital — for Indian companies (and funds) to get better terms and access to finance.
For new entrants like Chingari, Mitron and other hopefuls — the challenge is not in luring creators (influencers) to their platform. It is in bringing the fans — who will go where their friends are.
Do share your thoughts & comments.
Thanks,
- Aman
