However, while it made a splash, the likes of Meta followed soon after with a cannonball. RCS was also marketed to the masses as SMS+ and Advanced Messaging. They believed that adding more features to texting would entice further attraction and revenue. For those unaware, business messaging typically aligns itself with Rich Communication Services (RCS) a platform that was started by a group of businessmen who wanted to make the SMS experience “richer”. The mobile business messaging marketplace, which is such a mouthful for what essentially boils down to a “messaging platform”, has been on an uptick since the late 2010s, despite social media platforms nearly killing off much of the competition. Now Skype has a huge portfolio of enterprise communication services, which includes Skype Manager - a web-based control panel that allows managers to allocate Skype credit to employees - and Skype Connect, which allows users to receive calls on their office phones.The mobile business messaging marketplace is projected to reach about USD 78 billion in revenue, according to a study conducted by Juniper Research. This motivated Microsoft to roll out corporate subscription packages suitable for conference rooms. By 2010, as much as 37% of Skype calls were business-related. In 2013, WeChat claimed it had 100 million registered users and more than 300 million registered Chinese users.Įven at the enterprise level, the relevance of instant messaging apps cannot be ignored. Messaging apps have become very important platforms in Asia at the consumer level, as evidenced by the recent success of Tencent's WeChat, which according to GlobalWebIndex is the fifth most-used smartphone app worldwide. The Viber acquisition provides Rakuten with direct exposure to the fierce market of instant messaging and freemium voice-over-IP services. 1 Internet services company", which involves generating meaningful cash flow from its overseas business. ![]() With 500 million users in 193 countries, Rakuten is now more than ready to take the next step in its plans to "become the world's No. In the long run, the deal could create a lot of value for Rakuten if the company succeeds at cross-selling some of its revenue-generating services like e-commerce, online securities brokering, or ebooks to Viber users. In the short term, games could be part of Rakuten's plans for improving the monetization of the messaging service. However, as Rakuten CEO Hiroshi Mikitani mentioned in a conference last week, Viber has huge growth potential in terms of users, especially in emerging markets. In exchange, Rakuten will be paying almost $3 per user, which may sound high if we consider that Viber generated $1.5 million in total revenue last year. Viber, which has users in 193 countries, will bring 300 million additional users to Rakuten's network. As a result, despite obtaining the core of its revenue from its e-commerce business in Japan, Rakuten managed to establish a global network of 200 million users, the first step in its globalization process. Given this difficult context, why did Rakuten buy Viber?Īlthough Rakuten started its business as an e-commerce shop, the company quickly built a rich portfolio of media services, as it bought a Canadian e-reader company in Kobo, UK website, American website Buy.com, a baseball team in Japan, and expanded into financial services. ![]() With most competitors offering free messaging and calls, monetization in this market is known to be extremely hard. The deal gives Rakuten exposure to the fierce market of instant messaging and freemium voice-over-IP services, where Microsoft's ( MSFT -2.18%) Skype, Facebook's Messenger, and Tencent Holdings' ( TCEHY -2.13%) WeChat are the main players. Viber is a call and messaging app company run from Cyprus by Israeli entrepreneur Talmon Marco.Viber, which obtains most of its revenue from selling stickers and emoticons to users, has never made money, logging a net loss of $29.5 million on revenue of $1.5 million for the year ended in December. Japanese Internet company Rakuten, a 10,000-person e-commerce giant with a $20 billion market capitalization , announced last week it will buy Viber for $900 million, in a deal that would add 300 million users to Rakuten's user base.
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