BlackBerry's BBM Is A Threat To Facebook And Twitter, Here's Why

Dec. 9.13 | About: BlackBerry Ltd. (BBRY)

BlackBerry (NASDAQ:BBRY) officially launched BBM Channels for BlackBerry devices recently, and is expected to do the same for Google (NASDAQ:GOOG) Android and Apple (NASDAQ:AAPL) iOS devices in the future.

BBM Channels allow users (individuals and companies, or "brands") to create a channel linked to their profile that other users can follow. In essence, channels are no different than a Facebook (NASDAQ:FB) page. Similar to pages, users create channels and post specific items related to the subject of the page (channel). But BBM channels also transforms BBM into a social platform similar to Twitter (NYSE:TWTR). When you follow enough channels or post enough stuff on you channel, you get a timeline.

In addition to having a similar social experience and functionality to Facebook and Twitter, BBM's strength lies in its ability to act as a communications tool. For example, BBM offers video calling the same way Microsoft's (NASDAQ:MSFT) Skype does. Like Skype, BBM users can also share screens etc. BBM also permits users to set up groups. Within these groups up to 30 users can chat, share pictures, add events and even make lists within groups. While Facebook offers similar capabilities, Twitter does not.

So in essence, with BBM channels, BlackBerry has supplemented BBM with social capabilities similar to that of Facebook, Twitter and LinkedIn (NYSE:LNKD). And since BBM already has the capabilities of Skype built in, in essence, BBM with the addition of channels is like having Twitter, Facebook, LinkedIn and Skype all in one application.

Granted that the social capabilities the new BBM are not as advanced as Facebook, but as far as Twitter and Skype are concerned, there is really no difference at all.

However, BBM has one disadvantage that the other three social platforms don't. BBM is confined to smartphones. Facebook, Twitter, Skype and LinkedIn are all available for mobile, but they are also available for the desktop. In fact, all of them were developed for the desktop and migrated to mobile along the way.

And why is this a disadvantage you say? Because most people actually use these social platforms via the desktop. For example, Facebook has about 1.2 billion registered users, but only about 50% of them use Facebook's mobile app. The bulk of the users are on the desktop. The same applies to twitter and that is especially true for LinkedIn.

Sure Twitter and Facebook are on a marathon run to attract more mobile users, but that's because they were already on the desktop. BBM is a pure mobile app. Yes mobile has its advantages, but there are more users on the desktop than mobile.

The next question is, assuming BBM goes desktop and on all platforms -- including Microsoft's WP8 and Windows 8 -- as well as on the web (via a browser), will that increase the total number of BBM users and transform BBM into a Twitter and Facebook competitor? I think so.

While no one really knows how many registered users Twitter has (speculation has it that they are about 900 million), in the company's recent prospectus Twitter says it has about 230 million monthly users, with about 100 million daily active users. In addition, Twitter claims to handle about 500 million tweets every day. However, there are studies that say that the lion's share of Twitter's monthly active users (about 140 million of them) barely register one tweet per month, and most of the daily tweeting is done by only 42 million active users.

Facebook on the other hand is the social elephant powerhouse, claiming to have about 1.2 billion monthly users and 728 million active daily users respectively. Please take note that active daily mobile users averaged about 507 million for September.

Now let's look at BBM. According to the official BlackBerry blog (as of May this year), BBM had 60 million active monthly users and 50 million active daily users. With the addition of at least 20 million iOS and Android users, the figure is now about 80 million monthly users with at least 60 million daily users.

But there is also something else that BlackBerry says on its blog. It claims that BBM handles about 10 billion messages per day, or "nearly twice as many messages per user per day as compared to other mobile messaging apps". Let me repeat that, 10 billion messages per day!! If this number is true (and I am assuming it to be true because I have not seen anyone disputing it and it is an official BlackBerry claim), then BBM is about 20 times larger than Twitter in terms of absolute transactions.

Why is BBM a threat?

Today BBM has at least 80 million users. You might say that this is not a large enough number, but when you consider that ...

  • BBM resides almost exclusively on BlackBerry mobile devices
  • It only recently become available for Android and iOS, with no WP8 version yet
  • There is no desktop app for BBM and it cannot be used in a browser yet
  • BlackBerry's market share has deteriorated

... 80 million users is a very large number.

Facebook has over 1 billion users, however Facebook is installed in just about every Android and iOS device in existence, in addition to being on just about every desktop computer in the world (well almost). The same applies to Twitter to some degree. So these two social platforms have a much bigger install base, because they are available for all computing mediums.

How BBM can become a threat the Facebook and Twitter

While the BBM install base can increase with every new BlackBerry device sold, the reality is that BBM can increase its install base a lot more simply by becoming available for the desktop (in app form or via the browser) and on other computing platforms like Windows and WP8.

So the question is, is there a desktop BBM version in the works? Officially we have no word on that yet, but BlackBerry Leaks had this to say:

Click to enlarge
(Click to enlarge)

While we do not have any confirmation of this, it is the next logical step for BBM.

Bottom line

BBM can become a highly praised asset for BlackBerry if BBM reaches an installation base of several hundred million users. And while increasing BlackBerry's device sales will help, the absolute best way for BBM to become more popular -- especially now with BBM channels -- is to deploy BBM on all computing platforms.

BBM provides users the best of both worlds, because it is a fantastic communications app and with the addition of BBM channels, it now matches the social capabilities of Twitter and some advanced capabilities of Facebook.

So be on the lookout if and when BlackBerry releases BBM for the desktop. Because when it does, it will be the day that Facebook and Twitter -- as well as Skype and LinkedIn -- will face real competition. And that might also be the driver for a higher BlackBerry stock price, irrespective if more BlackBerry devices are sold or not.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.