Snapchat prioritizes its platform over its original content

Tech companies love to dip their toes into the fetid waters of media production. Sometimes that works out, as Netflix and Amazon have shown. Other times it doesn’t, which appears to be the case with Snapchat following a report that it has permanently shut down the in-house video network it debuted in January.
That network was called Snap Channel. It was supposed to relaunch after its  team moved into a 12,000-square-foot studio in Marina del Rey. Instead the channel has been shut down, the studio will be used by other Snapchat workers, and the 15-person team behind Snap Channel was laid off or reassigned. The channel was part of the Snapchat’s Discover network, which emphasizes byte-sized videos and animated GIFs. The network has been compared to a “cool kids table” that media companies fight each other to access — could that change now that even Snapchat has shuttered its own channel on the network? Probably not.
While some have interpreted Snap Channel’s demise as a sign of Discover’s greater problems, it seems more likely that Snapchat has decided to focus on building its platform instead of creating its own content. That’s hardly a surprise; tech companies often have to choose between one of those two sides.
Just look at Medium, which recently made a series of changes that could allow it to become an even more popular way for people to publish their stories. (It also, ya know, raised $57 million at a $400 million pre-money valuation. No biggie.) That company cut down on its editorial content production earlier this year by killing several sites, laying off writers, and reducing its budget for freelancers. Now it runs just two publications: the tech-focused Backchannel, and Matter, the science website it acquired in 2013 and turned into a general interest blog.
Medium went from a hybrid platform-publisher (please, god, don’t make me call them “platishers“) to being a straightforward platform. In doing so it reduced its costs, made itself less threatening to the media companies it’s wooing with new features, and was able to settle a long-running debate about its raison d’être.
Snapchat is probably doing the same thing. Instead of fussing around with content production — and taking up one of the valuable spaces at a table with intentionally limited seating — it’s focusing on the platform used to distribute that content. It likely isn’t abandoning Discover; if anything, it’s focusing on it.
Of course, there are platforms that have increased their focus on making original content in recent months. Vimeo announced three new shows earlier this month, and Reddit introduced a publication called Upvoted to stop sites like BuzzFeed from stealing content shared to its platform, among other things. These efforts make a little more sense than Snapchat’s, if only because both platforms are well-established and the companies can afford to split their focus.
And even when companies get original content right, like Netflix often does, it’s hard to please fickle consumers. Snapchat is essentially admitting that content is expensive, time-consuming, and hard to target at a broad audience. Owning the digital tubes that deliver that content to a bunch of eager, easy-to-market-to millennials, on the other hand, can be quite lucrative. It opted for the latter.

Kik CEO: “Hey internet are you listening? Messaging has peaked”

It has certainly been an interesting month for messaging apps in the U.S.

Around the same time the New York Times penned its zeitgeist proclamation that messaging apps like Snapchat will become hubs of content and commerce like China’s WeChat, we learned from Comscore that these apps have plateaued in the U.S. in terms of growth. The companies are still attracting new users, but the rate of adoption is slowing in the 18+ crowd.

Right on schedule, Snapchat launched its Discover media feature this week, showcasing content from companies like CNN and Vice in a big departure from its former chatting focused strategy. Was Snapchat leaving messaging behind?

Kik CEO Ted Livingston, one of Snapchat’s biggest messaging competitors in the U.S., has been wondering the same thing. Although the apps is ranked sixth in U.S. social networking apps by iOS download, and 26th in apps overall, Kik is also struggling from a slowdown in growth.

I caught up with Livingston to get his take on what’s happening in the U.S. messaging app world, what he thinks of Snapchat’s Discover tool, and whether a “WeChat of the West” is still possible. What follows has been edited for length, order, and clarity.

Kik just hit 200 million registered users, but the Comscore data showed Kik –and all the other messaging apps — have flatlined in terms of growth. What did you think of that?

I can tell you from Kik’s perspective, we’re not growing as fast in the U.S. as we were in the past. I can tell you it’s not bullshit. We were very relieved to see [the Comscore data]. We were thinking maybe there’s something wrong with just us, but it’s everyone. Hey internet are you listening? Messaging has peaked!

What do you think is happening? Is messaging not actually the future of social media?

App adoption in general is plateauing in the U.S. On top of that smart phone adoption has plateaued in the U.S.

Chat in the West is a commodity. When a 15-year-old kid says, ‘Can we chat on Kik mom?’ Mom is like, ‘No, why would I?’

For us that’s where the [WeChat-like] platform play starts making sense. One you have critical density among youth and you have these non-commodity services on top of chat, teens will bring in everyone else they know. They’ll bring in parents because they need to buy something for them, or a friend because they need them to plan events. The platform may become a ticket to the rest of the demographic.

So that’s where the future growth will come from?

Yes.

How does the plateau impact your plans in the present?

In a world where we are the only one plateauing, then we have the worst strategy. We’ve got to figure out how to keep up with everyone else.

When everyone is plateauing the question is what do we do now?

On that note, what do you think of Snapchat’s Discover? Is this the beginning of its big WeChat play?

Now it’s less about connecting with your friends as following brands. I’m like, ‘Oh shit, they’re just becoming a media company?’

Some have argued that media is just their first step in becoming a portal to other experiences, like gaming or personal budgeting apps.

I would say it’s definitely a step to becoming a platform…a broadcast platform (as opposed to a messaging platform). Snapchat started somewhere in between Kik and Instagram: private broadcast. But with the Stories feature they have gone more and more towards broadcast. So they are now a broadcast tool.

What is the best content to go from a broadcast tool to broadcast platform? To me it’s media. Makes complete sense.

Did you see that coming?

I did not, that’s not what I would’ve done. To me it’s very relieving because it takes some pressure off us. A messenger by itself is extremely difficult to monetize and it always has been in history. On the other side it’s brutally simple to figure out how to monetize a broadcast network like Instagram, Twitter, Facebook, and now Snapchat.

Maybe [Snapchat] has a great answer [with Discover] but it takes them further away from being the operating system that WeChat has been.