A new generation of Chinese apps aims to become a global phenomenon like TikTok without a bruising fight for space in the domestic market.
StarMaker lets users create and share self-made music videos. The karaoke video app, which first gained traction in Southeast Asia and the Middle East around 2018, now boasts over 240 million cumulative registered users.
“In 2021, we ranked first in music app downloads across 26 nations,” an executive for Kunlun Tech, the developer of StarMaker, told investors in April. “In 2022, we’ve remained dominant in Southeast Asia, northern Africa, and the Middle East, and we are growing in Europe and Latin America.”
Kunlun’s overseas social media business earned RMB 1.4 billion (USD 207 million) in revenue last year, a 57% increase.
Though StarMaker was born in China, it is all but unknown in its home market. From the start, the developer focused on marketing the app overseas and did virtually no advertising in China.
Several other Chinese social media apps share this foreign focus, and they are growing in scale. Livestreaming platform Bigo Live, developed by Joyy, operates in over 150 countries and territories and reports monthly active users exceeding 30 million.
Voice messaging app Yalla was developed by Yalla Group, a startup founded by a former employee of Chinese telecommunications equipment supplier ZTE. Yalla has gained users in the Middle East by hosting online events during Ramadan.
In setting their sights overseas, these developers are avoiding an increasingly saturated home market. Tencent Holdings’ WeChat and other leading Chinese apps have become an integral part of daily life in China.
Meanwhile, social media is in its infancy in Africa and some parts of Asia. Chinese startups aim to establish themselves in those markets before other competitors. They develop a variety of apps and services, such as games, then bundle the offerings with social media platforms to score users.
“India, Indonesia, and Africa have entered into the mobile era, which presents an opportunity,” Fang Han, CEO of Kunlun, said during a tech event. Because social media can incorporate various services, “it’s the best business.”
But the more fans such apps draw, the greater their risk of flying onto authorities’ radar—like TikTok did.
In May, the US Securities and Exchange Commission added 88 companies to a provisional list of issuers at risk of removal from American exchanges. Joyy and Yalla Group were among these names. The apps have not been blacklisted in the US at this point.
India has banned Chinese apps since 2020, including Bigo Live, after a flareup in the long-running border dispute between the two countries. Joyy maintains that Bigo Live is not a Chinese app since it is operated by a Singapore-based company.
The success of TikTok, which has over 1 billion users worldwide, has fueled friction with Washington.
TikTok sprouted from Douyin, the Chinese version of the app launched by ByteDance in 2016. The next year, ByteDance purchased similar apps in the US, starting a full-fledged expansion overseas.
In time, TikTok became the must-have app among young people, and the platform gave birth to a host of influencers. The app inspired other big-name tech groups, such as Facebook parent Meta, to turn toward short-form videos.
But as more young Americans used the app, US scrutiny grew. Former President Donald Trump issued an executive order targeting TikTok in 2020.
“TikTok automatically captures vast swaths of information from its users,” which “threatens to allow the Chinese Communist Party access to Americans’ personal and proprietary information,” the executive order reads.
President Joe Biden formally withdrew the executive order last year, but many in the US still voice concerns over data protection.
ByteDance says that TikTok and Douyin are managed separately. The company announced in June that it changed the data infrastructure for American users. Instead of using data centers in Singapore and in Virginia, TikTok will route US data through Oracle’s servers.