Rakuten has agreed to pay $900 million [£537 million] for Viber in a deal that will allow it to extend its reach beyond its home market of Japan and could as much as double its reach across the globe.
The Cyprus-based messaging service has some 300 million users worldwide and it will more than double Rakuten’s network of 200 million, chief executive Hiroshi Mikitani told a press conference in Tokyo earlier today.
"If we didn't buy [Viber] now, I don't think we could have bought it later, it's growing so fast," said Mr. Mikitani, according to the Wall Street Journal.
To date Viber hasn’t made any money and it posted a net loss of $29.5 million [£17.6 million] on revenues of $1.5 million [£896,379] for the year to December and Mikitani added that it was more than willing to foot the price tag due to Viber’s success in emerging markets that has seen it acquire users in a total of 193 countries.
Rakuten, which was founded back in 1997 by Mikitani, rakes in 519 billion yen [£3 billion] in annual revenue, most of which comes from the 90 million members it has in Japan and where it is facing stiff competition from the likes of Amazon and Yahoo Japan.
Mikitani’s hope is that Viber’s user base will use their phone number and password to open a Rakuten shopping account and that Viber’s virtual stickers will also be a source of revenue at some point in the future. There are also tentative plans to make games available on the platform.
Viber recently started allowing its users to send messages from a desktop as well as allow its users to call non-Viber users’ mobile phones in a move that was designed to challenge Skype’s dominant position.
Rakuten is best known on UK shores for its £25 million purchase of Play.com back in September 2011 and more recently it launched an Internet streaming rival to Netflix and LoveFilm called Wuaki.tv.