Japan's leading online retailer Rakuten has spent $900 million to acquire Viber Media.
The purchase of the calling and messaging app company will allow Rakuten to double its reach. The online retailer, which has a customer base of over 200 million across the globe, will add Viber's 300 million users.
Rakuten hopes to expand its reach in the digital content market and further boost its annual earnings of $5.1 billion, which primarily comes from its Japanese market. The retailer's international market ambition is driven by threats coming from other retail giants such as Amazon and eBay. The company has been preparing its team for its endeavour even using English as the language for its corporate memos and menus in its cafeteria so its workforce will be comfortable using the language.
"I am tremendously excited to welcome Viber to the Rakuten family. Viber delivers the most consistently high quality and convenient messaging and VoIP experience available. Additionally, Viber has introduced a great sticker market and has tremendous potential as a gaming platform," said Rakuten chief executive Hiroshi Mikitani
"Simply put, Viber understands how people actually want to engage and have built the only service that truly delivers on all fronts. This makes Viber the ideal total consumer engagement platform for Rakuten as we seek to bring our deep understanding of the consumer to vast new audiences through our dynamic ecosystem of Internet Services," Mikitani added.
Rakuten bought the Kobo e-reader business back in 2011 and also has a huge share in Pinterest. It also has online retailer play.com and streaming service wuaki.tv in its portfolio.
Messaging apps are now a hot commodity as teenagers, who essentially dictate what will click or not in the technology world, tend to move from mainstream social networks such as Facebook to experiment on what they see as more interesting platforms such as Snapchat.
Viber will also give Rakuten a good communication platform that can be used by its account holders. Buyers can contact sellers in the network to confirm details about products while, on the other hand, sellers can provide better customer service that can help boost their sales figures.
The move of the retailer can be compared to the interest of eBay for Skype in 2005. The plan of the former was to use the latter as a communications platform for its users but it never materialized until it had to give up the service to Microsoft.
"Rakuten is one of the world's most important Internet companies. It is truly dominant in its home market of Japan and has been rapidly expanding globally. 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 No.1 communications platform and our combination with Rakuten is an important step in that direction," said Talmon Marco, Viber founder and CEO.
The Rakuten-Viber transaction is expected to be completed in March.