Japanese company Rakuten will buy online messaging app Viber for $900 million, a move that will double its worldwide reach. Billionaire Hiroshi Mikitani who controls the company says that “This acquisition is a totally new strategy that will take Rakuten to a different level. Developing this messaging system on our own would have been impossible”.
The move will bring the 300 million users of Viber into Rakuten’s global network of 200 million. One possible use of Viber is for a consumer to contact an online store while making a decision on an item. Talmon Marco, Viber’s Chief Executive and Founder, said that “This combination presents an amazing opportunity for Viber to enhance our rapid user growth in both existing and new markets. Sharing similar aspirations with Rakuten, our vision is to be the world’s number one communications platform, and our combination with Rakuten is an important step in that direction.”
Viber is one of the top 5 messaging apps in the world today and was developed in 2010 by Viber Media. Although it has a huge user base the company is not making any money yet. As of December last year the company had a net loss of $29.5 million on revenues of $1.5 million. Mikitani is willing to buy the company at nearly a billion since he sees a huge potential in the app.
This isn’t the first time that Rakuten made a big acquisition. The company has spent billions of dollars in the previous years on a buying spree. The company bought Canadian e-book firm Kobo for $315 million in 2012 and bought a minority stake in Pinterest worth $100 million. In 2012 the company also acquired Wuaki.tv, a European based video on demand streaming service.
With Viber on board the initial plan is for Viber users to be able to use their phone number and password to open a Rakuten shopping account. Games will also be coming soon on the messaging platform which will be a good source of app revenue.