Deal Made Between Telefonica and Line for Messaging App on Firefox OS

By Joe Rizzo
TMCnet Contributing Writer

Line is a Japanese proprietary application for instant messaging on smartphones and PCs. Line users exchange text messages, graphics, video and audio media, make free VoIP calls, and hold free audio or video conferences. Line, launched in Japan in 2011, reached 100 million users within eighteen months and 200 million users only six months later.

Telefonica (News - Alert), S.A. is a Spanish broadband and telecommunications provider with operations in Europe, Asia, North America and South America. It is the fifth largest mobile network provider in the world. Firefox OS is a Linux-based open-source operating system for smartphones and tablets. It is also set to be used on smart TVs. It is being developed by Mozilla (News - Alert).

Well, there you have the players. Each one gaining individual popularity, however, earlier this morning it was announced that the three had inked a deal. The goal of this partnership is for Line to increase its presence in the Latin American markets.

One benefit that Line will receive, later in the first quarter, is that the Line app will be available on the Firefox OS marketplace. In turn, smartphones will have the app pre-installed. In addition, future upgrades from Telefonica to its existing users will include Line.

This partnership gives Telefonica subscribers exclusive access to the Line app across what is described as key Telefonica Firefox OS markets. These markets include Venezuela, Peru, Colombia, Uruguay, Brazil and Mexico. The deal will also include Spain. The two companies said that additional markets will be announced shortly.

Since June 2013, Telefonica has launched Firefox OS in seven countries. Other carriers such as Telenor, Deutsche Telekom (News - Alert) and TIM have also started ranging phones running the Firefox OS. However it’s unclear at this point as to exactly how many users there are for Firefox OS.

The reason is that its carrier backers have not disclosed sales figures. You would expect that if the platform had taken off with gusto that the carriers would be announcing it. The platform is getting a slow but steady push. Today’s announcement lends credence to this feeling.

The fact that Telefonica has 320 million subscribers worldwide that are using its network infrastructure could signify that this is a major step forward for Line. Line is hoping to take advantage of Telefonica’s considerable presence in the Latin American market. It hopes that its range of cute sticker characters and games, can find an Hispanic home.

The two companies said that the partnership will be supported by what’s described as “significant marketing campaigns” by both parties. Neither company is disclosing what the exact spending will be. To further show its commitment, Line is also going to be encouraging its users to join Telefonica’s network. This will be accomplished through special offers pushed to them via Official Line Accounts in what are being called “select markets.”

 Jeanie Han, who is chief executive officer, Line Euro-Americas Corp, said “By partnering with Telefonica we are underscoring our commitment to our expanding European and Latin American customer base.”

This most likely will be an uphill climb. According to Francisco Jeronimo, who is an IDC (News - Alert) analyst, there were somewhere in the neighborhood of 390,000 Firefox OS phones shipped in 2013. Although this number is expected to rise to around the 2.5 million mark this year, it will still only represent a 0.2 percent share of the total smartphone market.

Edited by Cassandra Tucker