South African social network Mxit is shutting down commercial operations after a significant fall in user numbers in recent years, donating its intellectual property and technology assets to mobile-based public benefit organisation The Reach Trust.
Launched in 2005, Mxit has close to 100 million registered users globally, recorded more than 17 million unique app downloads in 2014 alone, and has also expanded to Nigeria and India.
Yet in spite of leading the way globally in instant messaging, the company has lost ground in recent years, with its monthly active user base falling to 1.2 million in July this year from 7.5 million in 2013. Facebook and WhatsApp have become market leaders as Mxit struggled, with Disrupt Africa reporting last year it had offered a number of employees voluntary severance packages.
It has now announced the end of the road, but will be donating all its IP and tech assets to The Reach Trust, which was initially established to improve lives using Mxit technology. Michael Jordaan, who will be leaving his position as chairman, said he was sad for shareholders but happy for free education in South Africa.
Users will still be able to access and use all the services of the mobile social network, but commercial operations will cease after shareholders said they believe essential Mxit assets can be used more meaningfully for social good in Southern Africa.
“Whilst Mxit overall has seen a decline in activity and engagement over the past 18 months, the use of services offered by The Reach Trust on Mxit has been stable and in many cases show an upward trend,” said Francois Swart, outgoing chief executive officer (CEO) of Mxit.
Since its launch in 2012, Reach has helped more than 10 million people to improve their lives through access to free services on their mobile phones, such as educational programmes and text-based counselling.
The organisation will use key Mxit features such as the messaging service and the app publishing framework to sustain engagement with users, including more than 500,000 learners who continue to access educational apps on the platform every month. Its primary focus for the next 12 months will be on education in South Africa, with a number of projects already underway and a new flagship product to be launched early next year.
“With the power of mobile technology in the hands of almost everyone in the country, we believe that it is critical to extend and expand the access to mobile content and services to accelerate social and economic change,” said Andrew Rudge, CEO of The Reach Trust.