When Culture Trumps Economic Laws: Persistent Segmentation of the Mobile Instant Messaging Market

This paper discusses the general characteristics of the mobile instant messaging market from a competition point of view. Positive feedback and indirect network effects, which strongly influence the mobile instant messaging market, tend to facilitate the development of one quasi-monopoly. Even after several years of market maturation, however, no mobile instant messaging application has yet established such a monopoly, seemingly contradicting economic theory. In order to resolve this contradiction, this paper deconstructs the global instant messaging landscape using theoretical insights into local bias and distinct cultural needs. We find that differences between highand low-context cultures provide the most compelling explanation for market fragmentation and derive possible strategies for single applications’ global market expansion.