There are tons of instant messaging applications on app stores on every platform. Viber, Nimbuzz, WeChat constitute a few of the (very) successful ones. Whatsapp however, is undeniably the most popular Instant Messaging app ever. Reason enough for Google to be willing to shell out $1 billion for it?
Digital trends has reported that Google and Whatsapp have been engaged in talks over the past few weeks in order to work out a potential acquisition deal, valued at $1 billion dollars. According to the report, Whatsapp has been “playing hardball” and lobbying for a higher price, which could be somewhere around the $1 billion mark.
Whatsapp does not release its financial data, but is estimated to be making at least $100 million in revenues every year – without any advertisements. It charges iOS users a one-time fee of $0.99 for a lifetime subscription – while users on Android and other platforms get their first year of usage free – following which they are charged an annual subscription fee of $0.99 for every subsequent year.
Just within a day of the rumors surfacing though, Whatsapp’s Head of Business Development has said that the company is not “holding sales talks with Google” without sharing more details about any other potential purchase.
Whatsapp is the most popular app in almost all smartphone app markets right now – Google’s Play Store shows over 100 million downloads, and is listed as the #1 paid app in over a 100 countries on the iOS. On New Year’s Eve last year, the service processed an astonishing 18 billion messages on a single day. There’s no denying Whatsapp has been (and is) a major factor in the decline of texting all over the world.
There were strong rumors of a Facebook acquisition of Whatsapp late last year, which too had been denied by Whatsapp. Facebook then purchased Instagram last year.
The merger makes perfect sense for Google – it currently does not have any platform for messaging on mobile devices for users. Plus, with so many players in this market, it may not be a good idea to introduce another one and hope to succeed. In such a scenario, the acquisition seems like a good deal.
Google will soon be launching its messaging service – Babel – this year. Babel will be a unified service, allowing users to chat from anywhere, and has already been spotted on Gmail. If acquired, Whatsapp should fit into these plans seamlessly. Although, there is no information right now on whether Google will let it continue it as a separate app or integrate it in to Babel.
We’ll bring you more on this rumored acquisition deal IF it materializes.