As Elon Musk once again approaches a deal to buy Twitter, speculation is resurfacing over how the billionaire plans to transform the social network. Musk Tweeter this week offered a clue: “The purchase of Twitter is an accelerator of the creation of X, the application of everything.”
Although Musk hasn’t specified what X would look like, many believe it aspires to replicate the success of WeChat, which over the past decade has virtually become China’s everything app. People use it to read the news, go for car rides, book doctor appointments, pay taxes, and perform a myriad of other daily activities.
That may indeed be Musk’s idea given that he raves about the Tencent-owned messenger. During his first town hall with the Twitter team in June, the Tesla founder mentioned WeChat as a possible vision for the American social network.
And, you know, if I think of, like, WeChat in China, which is actually a great, great app, but there’s no WeChat movement outside of China. And I think there is a real opportunity to create that. You basically live on WeChat in China because it’s so useful and useful for your daily life. And I think if we could achieve that, or even come close to it with Twitter, that would be a huge success.
WeChat has long been celebrated in the West as one of the greatest inventions to come out of the Chinese Internet. And Tencent’s investment in Tesla likely gave Musk some insight into the Chinese internet giant. But is the WeChat model really a desirable product for the United States?
The exact WeChat features that impress Musk are also the source of the app’s reviews. The all-in-one messenger has in effect erected a walled garden, according to critics, where e-commerce transactions only take place on its payment app and information consumed by users is either published to the infrastructure of WeChat, or in third-party services supported by Tencent. Links from Tencent’s enemies, like Alibaba and Douyin (TikTok’s sister in China), were inaccessible on WeChat until Beijing’s recent anti-monopoly movement started tearing down the thick walls.
A super app can bring convenience to users as they hardly need to leave the platform – which helps generate revenue for the business – but the model can stifle competition and exclude user choices .
Putting these concerns aside, could Musk after all replicate the success of WeChat in the US?
Unlikely, at least not WeChat in its current state. The messaging app has thrived in China-specific conditions, for better or worse. Before we dive into what WeChat has done well, let’s not forget that its core as a social messaging app makes it fundamentally different from Twitter, which is a social media platform. The fact that it’s a chat app means it’s very sticky. With over 1.3 billion users, WeChat is the ubiquitous messenger in China, while people go to Twitter mainly to consume information rather than to talk to people they know in real life.
The unfair advantages of WeChat
WeChat did not start from scratch. Tencent was already the king of social media in China with QQ, an ICQ-like messenger that took off in the PC era. Shortly after the launch of WeChat in 2011, Tencent opened the huge QQ social graph to WeChat, giving people the ability to add QQ friends on WeChat. If Musk were building X from the ground up, he could have fun funneling Twitter users to the new platform. But, sticking to the WeChat analogy, it would be competing in a crowded market of WhatsApp, Messenger, Telegram and others.
WeChat is a collection of many apps rolled into one, and messaging is a gateway through which people come to experience the plethora of features it has added over the years. One of its first flagship features is a content publishing feature called Public Accounts. When public accounts were launched in 2012, Weibo and blogging platforms were the two places where Chinese netizens could make their voices heard. The former had a 140-character limit like Twitter, while blogs were mostly popular among Chinese elites. Built from a daily chat app, Public Accounts quickly attracted everyone from economists to small business owners who wanted to spread ideas.
By early 2021, 360 million users were reading articles through public accounts. Any organization that needs to produce content is on WeChat, from state media to fashion brands. The online media landscape in the United States is much more diverse. People read news on news apps, seek thought leadership on LinkedIn, and discover brand stories through blogs. The majority of businesses in China may not have a website, but they probably have a WeChat public account.
Over time, Public Accounts has evolved into a digital infrastructure for businesses not unlike Shopify. This was made possible with the launch of WeChat Pay in 2013. While America has spent the past decade improving swipe card transactions, China never had the widespread adoption of credit cards and moved on directly from cash payment to mobile payments using QR codes.
WeChat Pay has quickly attracted a large number of users by becoming the default payment option for a few popular apps, including Didi and food delivery platform Meituan, both of which are backed by Tencent, one of the the most prolific investors in the world. If Musk were to launch a new payment solution that follows the WeChat Pay playbook, he would have to form alliances with other internet giants to drive adoption.
WeChat’s role as the backbone of e-commerce has only become more omnipotent over time. In 2017, it started letting developers build lightweight apps that run in WeChat. Businesses that used to sell products through static public account pages can now run WeChat-based stores that have all the basic functions of an e-commerce application. Pinduoduo, the social commerce startup that grew to rival Alibaba in half a century, took off as a mini app thanks to its seamless integration with WeChat’s social features. Imagine being able to browse Amazon on WhatsApp, share product pages with your contacts, and make a purchase without ever leaving the messenger.
After morphing into the Word Wide Web for China’s mobile internet, WeChat has built an app ecosystem within it. Tech companies like Amazon, Uber, Facebook and Square are unlikely to want to join a hypothetical super app X, given that they already have a stronghold in their industries and control over user data. Following the WeChat model, Musk would essentially be up against established tech giants with hundreds of millions of users and their own payment products.
The Tesla Advantage
Rather than emulating WeChat, Musk could leverage an advantage Tencent covets. Most major Chinese internet companies, including Tencent, have invested in or partnered with an electric vehicle maker. While some of their investments are simply financial, others are betting on a future where smart vehicles become a major portal for entertainment, shopping and even information consumption – and they want to have their skin in the game.
Indeed, Tencent has already partnered with its portfolio company Nio, one of the fastest growing electric vehicle startups in China, to create a news program tailored to people while they drive. Nio could easily connect a range of other third-party apps, such as video streaming services and voice assistants, to its in-car operating system. And Tesla too.
Tesla already has the infrastructure to do this. As my colleague Kirsten wrote:
Tesla is open to third-party developers. The Tesla API is technically private. But it does exist, allowing Tesla’s proprietary app to communicate with cars to do things like read battery charge status and lock doors. During reverse engineering, it is possible that a third-party application communicates directly with the API.
WeChat’s success story is inspiring, but it may not be what the American public wants and its vast online consumer empire cannot be easily replicated outside the Chinese context. Musk could leverage the Tesla app and integrate it into his hypothetical Project X, taking inspiration from how WeChat formed a vibrant in-app ecosystem with third-party developers, but even with Tesla’s dominance over electric vehicles and a social network in hand if the Twitter agreement goes through, it still does not correspond to an “everything” application.