It was during one of his early visits to small-town India in 2016 that SHAREit India managing director Jason Wong stumbled upon a significant contributor to the file-sharing app’s huge success in the country: local mobile shops. Internet was still sluggish in cities like Madurai and Pune and these shops would use SHAREit to distribute content—new movies, songs or episodes of an on-going reality show. These were in great demand. Content downloaded off the internet but not accessible to everyone. Shortly after, the Jio revolution in India made the internet accessible for millions of people, but most first-time users still depended on others for their daily dose of local content.
“The first requirement of a user when they get connected to the internet is entertainment,” says Wong. “When we asked a Marathi-speaking factory worker from Pune that now that he has (access to the) internet, why doesn’t he download or browse content instead of waiting for his friend to transfer the files to him using SHAREit, he said he didn’t know how to make payments or download using a Torrent.”
Realising the huge potential for a simplified content platform for small-town audiences, SHAREit introduced a content play in India towards the end of 2017, beginning with user-generated content. “We felt the expectation from our users was to help them discover, consume and engage with relevant content,” says Wong, adding that to build a company with 1 billion users, focusing on vernacular consumers is the way to go.
Of the China-based platform’s 1.5 billion total installs globally, over 400 million are from India. SHAREit has remained a constant among the top 20 apps by installs in India in Google Playstore. And it’s this huge user base that Wong is depending on. “We can simply convert the previous utility users into content consumers. That is our strategy.”
Success in India isn’t a given, though. Neither is it just another option.
“SHAREit was founded by Chinese folks but we call ourselves an Indian company,” says Wong. “We don’t call ourselves a Chinese company because if we lose the India market, we need to shut our business down.”
To put things in context, the vernacular content space is quickly growing to be the next platform battleground in India. From India-born players such as Sharechat, Clip and Roposo, to Chinese platforms such as Helo, TikTok, Vigo and Kwai, all are competing to service lower-tier consumers who are being identified with tags such as Bharat, India 2.0, or the next 100 million internet users. Then, there are video streaming players such as Alt Balaji, Voot and Viu also servicing the lower-tier regional audiences.
Himanshu Gupta, a former India executive for Chinese messaging app WeChat, said SHAREit’s popularity in the country, which was based on a huge number of organic installs, began to decline with Jio’s launch. To arrest this, Gupta says, SHAREit seems to be trying to ride its existing user base and distribution to transform itself into a mix of short-form viral content and professional content-based platform. “SHAREit has the time and bandwidth to try and experiment since it continues to have a large base of users and a brand name that gets it free traffic in the medium term.”
Solving for local audiences
In many ways, ShareChat, a homegrown company that now boasts of 7.5 million daily active users (as at July, 2018), pioneered the regional content market in India. ShareChat is now battling Chinese giant ByteDance’s platform Helo that has about 10 million app installs. Finding new use cases like running agendas for political parties, to getting celebrity-based content, these platforms are offering more relevant content to vernacular users.
Does SHAREit stand a chance in this battle? The company believes it does.
“To be honest, we know we definitely can’t compete with the likes of Amazon, Netflix and YouTube. We are not even at the same scale of vertical players like TikTok. But in Bharat India, we are doing pretty good,” says Wong, adding that SHAREit has about 200 million monthly active users in the country.
Wong says when the company started its journey to focus on lower-tier India, there were very few players focusing on that market. Now it has become the hotspot for Indian startups. “It’s exciting to see so many players rush into the same area to provide service to the same group of people,” he says. “It indicates that the focus group is likely to mature to spend more and to get more services from the internet.”
The competition aside, the vernacular content market comes with its own set of challenges. Many rural areas still struggle with weak internet connectivity. The cloud infrastructure in India is not that strong, says Wong.
To work around challenges like faltering internet connectivity, SHAREit has a 300-member R&D team in Beijing trying to understand the nuances of India’s regional markets and tweaking the product.
For example, if the platform detects that a user is in an area with good connectivity, it asks the user if they want to cache 10 other similar videos. If a user enters a bad connectivity patch and loses connection during a download, the download picks off right from where it stopped. The platform cuts media files into very small pieces during the process of transfer or download, enabling partial downloads. It’s also challenging to make accurate recommendations to users, as many lower-tier users might not connect to the internet every day and have stale data.
“We realised that from many users we don’t receive real-time data on their behaviour,” says Wong. For example, if a user watched a video seven days earlier and connected to the internet today after seven days, we receive delayed data. Recommendations, in that case, might not be accurate. The company changed its algorithm to work on a delayed feedback mechanism. There’s also a team in India that takes regular feedback from users to keep track of their behaviour on the platform,” says Wong.
A 60-member team spread across Delhi and Bengaluru looks after SHAREit’s India operations—business, marketing and content moderation. Wong admits it is challenging for engineers sitting in Beijing to understand the varied customized requirements coming from a single market. “Gradually, we will move R&D to India,” he adds.
The language and location of a user are usually pointers that help the platform identify what kind of content users prefer to consume. For example, Tamil speaking consumers tend to watch regional Tamil content, international content or blockbuster Hindi movies. Telugu speaking consumers prefer badminton over cricket in sports content. This data helps the platform source and suggest relevant content for regional consumers, says Wong.
SHAREit’s focus at the moment is to increase the time users spend on the platform. Users currently spend less than a minute on it right now, says Wong. “We want to reach at least 10-20 minutes a day in the next year.”
A report by analytics firm Comscore indicated that an average Indian spent close to 3,000 minutes or 50 hours on their mobile phones in 2017. It also said that Indians spent 98% of their total online time on WhatsApp. In 2017, Indians spent more than 42 minutes a day on Whatsapp with an average 27 app sessions a day.
It’s not going to be an easy journey. With over a dozen popular social and media platforms fighting for attention and eyeballs of the new 100 million vernacular consumers, companies are pouring in millions on technology and content effort to get a larger piece of the pie.
A lot of these platforms have been criticised for promoting raunchy content to grab eyeballs.
(Read our story How Kwai turns a blind eye to videos featuring underage girls)
“The Chinese playbook is all about numbers and in many ways, it justifies the end over means,” says a Xiaomi employee who wished to stay anonymous. “So it is not even an ethical conundrum for companies when you see sleazy content being promoted on many of these platforms. It’s simply a matter of decisions made by algorithms on what works to get more numbers. And until they reach the scale of say TikTok, there is hardly going to be any special emphasis on moderation of content.”
In the case of SHAREit, though the content sometimes borders on sleaze, its approach of focusing on media content rather than socially generated content puts it in the bracket of companies like UC News, DailyHunt and NewsDog, where the companies have greater control over the content posted on their platforms.
“There are certain advantages to this approach as they can at least manage content on their platform, as it’s all being uploaded or managed by their content teams,” says Gupta. “It might be sleazy content alright but it’s company-managed sleazy content.”
SHAREit right now carries a mix of user-generated and over-the-top (OTT) content. The platform has partnered with OTT players like Hungama, Viacom, Alt Balaji and Speed Records to provide content to SHAREit consumers. The company works on a revenue-sharing model with some of these players. Currently, the platform does limited advertising in India.
The India market for lower-tier consumers is not mature enough to be monetised just as yet, says Wong. “You need to wait for the fruit to become ready to be picked, right now it’s a very small fruit,” he says.
The company’s not in a rush to monetise also because as the market matures, spending patterns of the new internet users will also mature.
SHAREit has also partnered with popular brands in India, including Airtel, Xiaomi and Oppo to understand advertisers’ requirements and run pilots for target consumers. The idea is that in the next few years the spending capability and aspirations of lower-tier consumers will increase. Platforms that understand their users better will be in a better position to target them through advertisements.
“In India1, the affluent English-fluent parts of India, people like us are acquired by apps and sold to advertisers. This follows the traditional content monetisation model popularised in the West,” says Sajith Pai, director at Blume Ventures in this FactorDaily story. “India2 is likely to be less attractive to advertisers, and a multi-pronged revenue model combining programmatic ad sales, some branded ad content, and some microtransactions/subscriptions will emerge.”
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Disclosure: FactorDaily is owned by SourceCode Media, which counts Accel Partners, Blume Ventures, Vijay Shekhar Sharma, Jay Vijayan and Girish Mathrubootham among its investors. Accel Partners and Blume Ventures are venture capital firms with investments in several companies. Vijay Shekhar Sharma is the founder of Paytm. Jay Vijayan and Girish Mathrubootham are entrepreneurs and angel investors. None of FactorDaily’s investors has any influence on its reporting about India’s technology and startup ecosystem.