The mobile messaging space is crowded. That much is clear. And as much as it pains us to think of it, it’s very possible that some of the biggest players in the game — Viber, WhatsApp, LINE, to name a few — could be targets of acquisition in the future.
That’s not saying that all acquisitions result in bad changes, as we’ve seen with the acquisition of Skype by Microsoft in 2011. The company has done much to improve the app and recently integrated it with its former Windows Live Messenger service, adding tens of millions of new users.
The problem? It’s simple: too little income for too many players. Some app providers could very well try to acquire others in an attempt to leverage larger user bases and eliminate competitors, thereby growing their income. Still others might be acquired by companies with other interests (read: Google WhatsApp acquisition rumors) and may not exist in the same way they do now, if they still exist at all. Carriers have also started launching their own apps, stretching the shared income a little farther. Many apps have coped by launching gaming platforms, advertising streams, or other ways to monetize users.
The apps with larger user bases, including those aforementioned, would be the most attractive acquisition targets. Companies could capitalize on the large user bases to further their own interests in the mobile messaging space, or possibly transition these same users to other services these companies offer. Imagine if Google were to buy WhatsApp for instance. Its new Hangouts app (and therefore Google+) would immediately receive 300 million user accounts (though likely many of these would be from the same people and could be combined a la Windows Live Messenger/Skype). Bernström said he believes it’s just a “matter of time” before Google makes this very move.
Viber is another likely target for an acquisition according to Bernström, since it has a truly global 200 million users at its disposal. He believes apps such as KakaoTalk and LINE will be left alone on account of their limited appeal.
“The interest in them is based solely on the size of their networks and the amount of use of their apps,” Bernström said. “The category winners are the ones that will get acquired.”
So acquisition appears to be more of an absolution than simply a possibility, especially as app developers continue to experience a growing strain as new competitors try to squeeze their way into an already crowded market. All in all, it could make for some very interesting changes, but could also ultimately lead to fewer choices, fewer competitors, and therefore some possibly degraded experiences for customers. What do you think?