Japanese company Rakuten, the owner of Kobo e-readers and online retailer Play.com, is acquiring Viber for $900 million. Rakuten has an ambitious goal of becoming “the world’s No.1 internet services company,” and acquiring the Viber messaging and video calling app will help it access a global user base of more than 300 million users. Viber has seen impressive growth, particular in the Middle East and US, and it’s clear Rakuten wants to take advantage of that for its aggressive goal.
With Viber, Rakuten has a lot of competition in a market that’s filling up with messaging and video calling apps. WhatsApp now has more than 400 million monthly users, and Skype has around 300 million users worldwide. Facebook is also a formidable competitor thanks to its more than 1 billion users. Despite all this, Rakuten CEO Hiroshi Mikitani believes Viber “has tremendous potential as a gaming platform.” Part of that potential may come from Viber’s expansion to the PC and Mac last year, providing more platforms to target users with games and other services.
Viber is one of only a few messaging apps that’s truly cross-platform. While WhatsApp supports a variety of mobile platforms, the company has no intentions of bridging the gap to desktop computers and building apps for PCs or Macs. However, the real competition for Japanese company Rakuten might be in its home country. Line, a messaging app popular in Asia, has doubled its user base to 350 million over the past year, and counts 50 million users in Japan alone. Viber’s popularity in the US, Australia, Russia, and Middle East, will help Rakuten globally, but Asian markets continue to grow thanks to the popularity of chat apps with games and stickers.
Rakuten’s latest acquisition is just part of a continued global buying spree for the company, after it has spent billions of dollars on acquisitions ranging from e-reader company Kobo to an investment in social networking site Pinterest. However, Rakuten has been ambitious before, and its plan to beat Amazon in Japan hasn’t really worked out. Rakuten completed its Kobo acquisition in 2012, and Amazon launched its Kindle e-reader in Japan four months later. The Kindle is a top-seller in Japan, and Kobo has struggled to respond. Ratuken also shuttered the retail part of Play.com around a year after acquiring the service. With its latest acquisition, Rakuten will be hoping the same mistakes aren’t repeated in a crowded messaging market.