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Elon Musk wants to expand Twitter’s successor X into a so-called “super app”. Such general-purpose platforms have so far been particularly successful in Asia. What offers are already available – and what can they do?
Elon Musk is driving forward the conversion and expansion of the short message service X. The online platform formerly known as Twitter is expected to be approved as a payment service provider in California and New York in the coming months, the company’s boss said at a Morgan Stanley conference this week. Some other states, including Pennsylvania and Utah, have already given the green light.
If X gets a license to transfer money in every US state, users could, among other things, send money to each other in the future. Musk is following the example of Asian companies, some of which already offer “super apps”. But what exactly is it about?
What is a “super app”?
A “super app” is considered a kind of “Swiss army knife” among apps. It combines messenger services, direct payments between users or online shopping under one roof. Some also include ordering food or calling a taxi. This means that users of the “all-purpose apps” can not only exchange messages, pictures and videos, but also order food, carry out financial transactions or book hotels.
According to Scott Galloway, a marketing professor at New York University, these programs are particularly popular in Asia because people there use their smartphones as their primary access to the Internet. But experts from the analysis firm Gartner believe that the “super apps” will experience strong overall growth. By 2027, half of the world’s people are expected to use more than one of these programs.
Are there already such “all-purpose apps”?
Yes there is. An example of a “super app” is WeChat from the Chinese internet company Tencent. It is estimated that more than a billion people in China use the program, which was started as a messenger service. Users can now use it to call taxis, send money to friends or pay in stores.
The Grab app from Singapore, which offers food delivery, ride-hailing and financial services, is also popular in Southeast Asia. The Indian conglomerate Tata is also active in the market with its Tata Neu platform. Through this application, users can purchase all sorts of goods and services from clothing to airline tickets.
What is the situation with US tech companies?
The Snapchat operator Snap introduced direct payments between users years ago. However, the function was switched off again in 2018. The integration of mobile games also recently fell victim to austerity measures.
Facebook and Instagram, both of which belong to the Meta Group, also offer functions for online shopping. In beta versions of WhatsApp, options were found to link the app more closely with Instagram or to listen to music or watch films together during video calls.
Since taking over X, Tesla founder Musk has also wanted to expand the platform, similar to WeChat, to include functions that go beyond sending messages, pictures or videos. In addition to direct payments between users, for which X needs a license in every US state, the issue of financial investments could also play a role. According to a media report, X is in contact with stock exchanges to explore cooperation for securities transactions.
What is it like in Europe?
In Europe, the topic has so far been neglected, says Jeremy Baber, head of the online financial service provider Lanistar. “Some well-known companies such as Uber, Klarna and Lydia have started to explore the possibility of diversifying their apps, but need to go much further to achieve ‘super app’ status.”
Despite possible risks, “the popularity of ‘super apps’ will continue to increase,” predicts Baber. European companies should therefore hurry up so as not to miss the train.
What are the risks?
The more functions a single app offers, the stricter the security precautions should be. Because if hackers gain access to a “super app,” they can potentially cause greater damage than with a traditional user account for a single application.
Data protection advocates and regulatory authorities are also critical of companies’ expanded access to user data. For example, the provider of an “all-purpose app” not only knows the purchasing behavior or culinary preferences of its customers, but also their financial situation and whereabouts.