Adam Powell

Korea's free KakaoTalk mobile app reshapes business communication models and language

By Adam Powell | October 22, 2012 1

img_main02.pngSEOUL - Kakao Talk, the free mobile phone text service that has exploded in popularity here, has reshaped the way Koreans communicate worldwide. It has even had an impact on the language and expression, with KFL, or Kakao as a Foreign Language.

Available since summer for the iPhone, Android and Blackberry cell phones, Kakao, or KaTalk for short, has been downloaded by tens of millions of users. Based in Korea, it is growing worldwide, and it is now available in Japanese and English.

Users are switching from SMS text for good reason: KaTalk lets them send and receive text, pictures and even video - all for free, as long as they are using wifi. And without wifi, Kakao Talk is cheaper than other plans. But KaTalk has grown so quickly that it even surprised Kakao's CEO.

"The application grew much faster than we expected because the mobile environment and paradigm is changing rapidly," said Lee Jae-Beom, Kakao Talk's CEO, in an interview with AFP. "Mobile messengers...not only substitute for SMS, but also create a new communications culture, where users can actually chat even without a computer and have a group conversation."

OK, the cell phone paradigm may be changing rapidly worldwide, but that does not mean 61-N2HTRXPL._SL500_AA300_.jpgmobile phone companies are happy with such new apps as Kakao: quite the reverse is the case, according to published reports, with some accusing Korean cell phones companies of deliberately downgrading the quality of KaTalk. After all, the service is free, argue the mobile network operators, and phone providers are not being paid (yet) for all of that additional traffic.

But Kakao's business plan does not rely on charging for traffic or downloads: The company makes money from premium services and online gifts. And to make it easier for users to pay for premium goodies, Kakao last summer launched its own virtual currency, called chocos.

KaTalk is far from unique here in Asia: Just as Gillette famously lost money on razors but then profited from razor blade sales, mobile phone messaging is a loss leader to sell other products and services to cell phone users.

"Japan, Korea and to a lesser extent China are leading the way in terms of mobile messaging-centric apps that move into diverse and potentially very profitable new service areas like gaming, affiliate marketing, next-generation emoticons," analyst Mark Ranson told the Associated Press in an interview. "Offering a free, high quality messaging service is a good way of building a large and loyal user base which can later be introduced to more readily monetizeable services."

However Facebook has a huge and loyal user base and is still losing money. But for Kakao, Line and other Asian mobile message services, that is not as a problem: it's an opportunity.

"Kakao Talk and Line are seeing opportunities as Facebook isn't making money fromPicture 2.png users of its mobile website and app," Ryu Han-seok, told the AP. "It is probably tough to compete with Facebook in the U.S. or Europe. But in Japan, South Korea and other Asian countries, they have a good chance of beating Facebook."

Then there is KFL: Kakao as a Foreign Language. When users move from text messages in English or Korean to chat in KaTalk, to avoid looking so 2010, they will need to master a new series of terms and symbols that provide emotional context and mood. Just as Facebook introduced "friend" as a verb, Kakao has introduced terms ranging from "crying eyes" to "blushing face girl." (See some examples here.)

And if you don't know what "sunglasses face" means, then you shouldn't be using that symbol.

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1 Comment

April 2, 2014 7:48 PM

I love this app because of hundreds of cute & funny emoticons. Even better, because they are moving! so my friends and I enjoyed a lot using Kakao Talk.

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