Barcelona: WhatsApp Business’ market share in the CPaaS (communications platform as a service) segment in India is not going to be threatened by the entry of Google-supported rich text messaging (RCS), said a top executive from Meta, the messaging platform’s parent.
“We don’t see RCS as a threat to our market share. We actually welcome competition. Our focus is on the consumer where we need to earn market share by doing the best for our clients and not by blocking or diminishing competitors,” Tarcisio Ribiero, director of international business development at Meta, told ET on the sidelines of the Mobile World Congress.
“We need to prove our own values on our own merits,” said Ribiero, who also leads the WhatsApp Business vertical for Meta globally.
Industry estimates put WhatsApp Business’ market share in the CPaaS segment at around 5% by volume and 15% by revenue.
Ribiero’s comments come at a time when a battle is brewing between Google and WhatsApp over the rapidly growing enterprise messaging market in India. The US search giant is pushing an alternative mobile phone messaging system in India that some say could disrupt the growing use of WhatsApp by enterprises for communicating with customers.
Conversational commerce wherein brands use channels such as WhatsApp and other messaging apps is expected to be a $150-175 million market in India by 2030, out of $40-50 billion globally, with generative artificial intelligence expected to be a major boost, Ribiero said, citing data compiled by Tanla Platforms, a top Indian CPaaS player. Currently, the market is very small.
“Generative AI will enable businesses to automate their processes. I think it is one of the most exciting developments in the last few years or decades,” he said.
Increasing competition from RCS being popularised by Google is good for the market as that will only add more value to customers, he said.
But WhatsApp’s strength lies in the fact that it is used even by users of entry-level smartphones that do not have the memory to install multiple apps, and it enables a whole bunch of merchants who otherwise would have no way of reaching a large customer base with a platform to sell their services, he said.
WhatsApp launched the enterprise messaging service in 2018.
More than 45 million small businesses in India use the platform now to drive utility as well as promotions, said Vish Bajaj, chief executive of ValueFirst, which aggregates various enterprise messaging channels.
RCS adoption by businesses, though, is still nascent in India with a user base of around 300 million, and negligible volumes, according to market estimates, as compared to around 550 million users and over 3 billion monthly message volumes on WhatsApp Business.
That said, channel aggregators such as ValueFirst and Karix expect RCS volumes to grow significantly in the coming months with direct-to-consumer brands being the early adopters.
Stephen Brough, global go-to-market head for RCS business messages at US search giant Google, said 75% more consumers are likely to buy from brands that share rich media content, with RCS showing a 60-300% increase in response rate as compared to SMS. Businesses can have trusted branding, that can protect users from fraud, along with adding other rich media elements, he said, speaking at a session in the Mobile World Congress.
Google’s RCS is priced at almost twice the traditional enterprise SMSes but 70-75% lower than WhatsApp’s charges, which could be a big draw for enterprises, said market experts.
But Ribiero said WhatsApp may look at dynamic pricing in the near future where industries with high return on investment could be charged higher for using WhatsApp Business, like how Meta’s ad platform works.
However, the end consumer pricing is controlled mainly by distributors who leverage the platform for enterprise messaging, Ribiero said. “We don’t set market prices. We primarily work with distributors, and we do not control the prices they offer to their consumers.”
Aravind Vishwanathan, chief financial officer of Tanla Platforms, said WhatsApp is a channel partner for CPaaS players and that it charges per session. CPaaS players then add their margins and do the necessary value addition on a per-customer basis to arrive at the customer pricing.
(The reporter is in Barcelona to cover the Mobile World Congress at the invitation of Tanla Platforms.)
