WhatsApp and Google Negotiating a Rumored $1 Billion Deal, Could Be Google's Entrance Into Mobile Messaging

Companies rumored to be negotiating a deal worth $1 billion.

 @ryanWneal
on April 08 2013 2:20 PM

WhatsApp A Monday morning rumor says that Google is looking to purchase WhatsApp, possibly for as much as $1 billion.  Flickr

Popular messaging service WhatsApp could be the next high-profile digital purchase for Google. Digital Trends reports that WhatsApp has been “playing hardball” with the Mountain View, Calif.-based search giant to negotiate a potential $1 billion acquisition.

The app allows users on Android, iOS, BlackBerry and Windows Phone to send text, image, audio and video messages to one another without having to pay for SMS. WhatsApp is immensely popular in Europe and Latin American, where 80 percent of smarthphone owners use the app in some countries.

While $1 billion may seem exorbitant – especially after Facebook acquired Instagram for that amount in a deal that some say hasn’t paid off for the social network – it’s estimated that WhatsApp’s user base is more than 300 million. On New Year’s Eve, it handled around 18 billion messages, and it is consistently the No. 1 paid app in more than 100 countries.

This could provide a lucrative new advertising platform for Google, which hasn’t made many moves toward mobile messaging yet. It would also be a good fit for Google Babel, the much rumored program that many expect will unify Google’s communication platforms.

But WhatsApp already has a successful monetization plan in place. While the company doesn’t release official figures on revenue or user base, Digital Trends estimated that WhatsApp earns around $100 million a year between its $0.99 yearly subscription fee and lucrative partnerships with international telecommunications companies.  WhatsApp also has a reputation for being staunchly anti-advertising, so it is unclear how a relationship with Google would work.

If the acquisition takes place, it’s sure to upset some WhatsApp fans. Commenters are already lamenting the hypothetical move, saying it would mean the end of WhatsApp on the Windows Phone and text messages full of ads.

Still, it’s hard to argue with $1 billion. The rumor has yet to be confirmed by anyone outside of Digital Trends, but the acquisition makes a lot of sense from Google’s end. With the I/O conference coming up, WhatsApp could be just the thing for Google to enter into mobile messaging in a big way.   

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