AIG CEO Andy Tian says the super-apps of the future will be “much more diverse, much more fragmented, much more interesting.”
By PETER GUEST，21 APRIL 2021，Rest of World
On a visit to Google’s Mountain View campus in 2005, Andy Tian found himself in a windowless conference room watching a PowerPoint presentation given by the co-founder of a company that had created a powerful new operating system. The company had just been acquired by the search giant, and the co-founder wanted to pitch Tian, who was then in charge of Google’s push into China’s mobile market, on the system. “I said, ‘What’s it called?’” Tian recalls. “He said ‘Android.’ And I thought, ‘That’s a terrible name.’”
Tian, who was born in China but moved to the U.S. when he was 11, has built a career straddling both countries’ tech sectors. A loquacious, mile-a-minute speaker with a knack for one-liners (“The way to do it is to make mistakes in other companies first, with other people’s money.”), between 2005 and 2007, he built Google’s relationship with China’s mobile operators and manufacturers. Tian then left the company in late 2007, as its relations with the Chinese government soured, forcing it to rein in its ambitions in the country. Afterward, he launched XPD Media, a Chinese social gaming company that was sold to the U.S. giant Zynga — responsible for breakout Facebook titles like Farmville and Words With Friends — in 2010.
His current venture, Asia Innovations Group (AIG), is based in Beijing and borrows from both of the places where Tian used to work, combining Google’s ability to export its products abroad and Zynga’s blend of social media interaction and gamified rewards. But more than anything, AIG is a bet that the future of social media in emerging markets will look a lot more like Chinese platforms than American ones.
AIG is riding several waves at once: the proliferation of live social media apps like Clubhouse; the growth of video e-commerce, demonstrated by the $5.3 billion IPO of the Chinese tech company Kuaishou in February; and the surge of interest in gamified, social dating platforms, like the South Korean startup Hyperconnect and its apps Azar and Hakuna Live, which recently sold to Match Group for $1.73 billion.
AIG’s products, which include the video entertainment app Uplive and dating platform Lamour, already have more than 328 million users in 200 countries, according to company materials. The apps have taken elements from earlier generations of Chinese tech companies, like Tencent, but also mix various features together in different ways, like combining livestreaming with gaming, or virtual goods with in-app payments, which distinguish them from the first generation of U.S. social media platforms.
“My friends in Silicon Valley, sitting under blue skies, sipping nonfat double lattes, don’t really appreciate the kind of social environment we have in Asia,” Tian said over a video call from Beijing. “My U.S. friends tend to build social as a standalone feature. They have one feature only. Instagram: filters. Snapchat: you can send disappearing images. Clubhouse: you can talk to large groups. … The next generation of mobile social [is] much more diverse, much more fragmented, much more interesting.”
But one of the advantages U.S. companies have over Chinese startups, Tian said, is that they travel better. Chinese companies have recently pioneered a number of innovative e-commerce models, including digital payments, group buying, and livestreamed social selling, whereas, in the U.S., e-commerce is still relatively unsophisticated, relying on a functional postal service and the widespread use of credit cards. Chinese models, theoretically, should be more compelling to users in emerging markets, where users are mostly on mobile phones, and where payment infrastructure is relatively weak. But China’s top internet companies, like Tencent and Alibaba, have struggled to gain traction when they have tried breaking into overseas markets.
The reason, according to Tian, is that Chinese companies have historically been very bad at localization. “If you don’t have the sensitivity of language, culture, religion … you’ll fail,” he said. “This is why some of the biggest, first-tier internet companies in China have not been successful in picking up users out of China.”
AIG’s backend development is done in Beijing, but the company also has a network of 12 offices across North Africa, Latin America, and Asia. Around half of its 900 employees are based outside China. Although there are big differences between the various markets where AIG operates, the company has found opportunities to leverage their similarities. Indonesia, for example, shares the same Muslim religion with countries in the Middle East and North Africa. The Indian diaspora, which makes up a major user base for the platform, is spread across the world, and AIG can target those customers in many different countries.
AIG has also found that some content its users share resonates globally. A partnership with Google allows it to run live subtitles on its livestreaming app in several languages, meaning that users in Taiwan can interact with users in Vietnam and vice versa.
That allows AIG to tap a global user base of content creators: Korean livestreamers — particularly men — are popular across Asia, while Filipino users often get global exposure “because they sing really well,” Tian said. This movement of cross-border content has created problems for the company, which needs to ensure that what its users post reflects local laws and cultural expectations, from conservative Muslim countries in the Middle East to socially liberal South American nations. “We have to warn our Brazilian streamers not to be too sexy,” Tian said.
Some content is geofenced by law — Saudi users cannot see what their counterparts in Brazil are doing, for instance. AIG’s platforms are actively moderated by human moderators, and all talk of politics and religion is banned. “I think that we’ve made some hard choices for our livestreaming platforms,” Tian said. “We don’t need to be everything for everybody. We’re not Facebook or Twitter. We want you to enjoy yourselves, make connections, make friends without shouting at each other.”
AIG earns revenue from selling virtual gifts that users can send to one another, typically cute animated tokens. The model was pioneered by the Chinese mobile gaming market and also by Zynga — several of AIG’s top managers, including the head of its dating products and its CFO, came from the U.S. gaming company. AIG encourages competition between users, who want to give and receive the most rewards, driving them toward greater in-platform spending. “It’s a game,” Tian said. “We’re building gamelike models, except you’re not playing with a virtual avatar, you’re playing with each other.” He added that half of all the virtual gifts bought on AIG’s platforms are sent internationally.
Tian is convinced that live content is the future of social media — a trend he said is confirmed by the success of the audio app Clubhouse, which has exploded from less than a million users to more than 10 million in less than three months. The growth of live social, Tian said, can be attributed to a combination of pandemic-induced desire for social interaction and the growing availability of fast mobile internet. Another innovation forged in China is also to blame: live filters, which replicate an Instagram-like experience for livestreamers who don’t have access to full studio setups. “Instagram without filters would die, right? We also needed live video filters,” he said. “A camera on a phone with software can [now] let you do all that stuff … that technology only existed in China because of 10 years of the livestreaming industry.”
The fact that this kind of Chinese innovation is starting to take root outside of the country shows, Tian said, that the next evolution of social media is underway. The first stage was led by the U.S., whose tech giants successfully brought their products to the whole world. “But what’s the next stage of evolution?” Tian said. “[Those of us] based in emerging markets, we are taking over. We’re decolonizing.”