Digital Trends is reporting that WhatsApp is in negotiations to sell out to Google in a deal that could be in the billion-dollar range. WhatsApp has long been the subject of acquisition rumors and is “playing hardball,” according to the single, unnamed source upon which the piece is based.
WhatsApp has been a clear leader in the era of over-the-top mobile messaging, which continues to eat away at carrier SMS revenues. The company saw a staggering 7 billion inbound messages on the second day of 2013, and while it doesn’t disclose figures its active user base is probably between 200 million and 250 million.
And Google is a good fit in a couple of ways: The company has the deep pockets to easily afford such a deal, obviously, and while behemoths like Apple and Facebook have been out in front in the mobile messaging game Google has admittedly dropped the ball. And although Google probably doesn’t need WhatsApp’s technology, as my colleague Kevin Fitchard noted, it might be inclined to follow the strategy Facebook employed with the $1 billion pick-up of Instagram: Acquire the dominant independent player to gain a huge audience and eliminate the possibility of competitor buying it.
I’m skeptical, though. There are plenty of WhatsApp competitors that could be had far more cheaply, as Silicon Angle notes. And Google already has a massive mobile audience with Android, so it could become a major player in the space simply with more focus and better execution.
There are a few other companies where WhatsApp may be a better fit, however. Both Amazon and Samsung are building mobile ecosystems within the broader world of Android, and a great mobile messaging service could be a key differentiator for either company. WhatsApp might also be very attractive to a company like Yahoo, which continues to struggle to find an audience in mobile. I wouldn’t be shocked to see any of those three make a play.