Why Google might want to buy WhatsApp

KEVIN LAMARQUE/REUTERS - A Google homepage is displayed on a Motorola Droid phone in Washington August 15, 2011.

Although the acquisition rumor circulating in the tech press Monday is shaky at best, it does serve to highlight a growing problem for social networks such as Google+ and Facebook — the rise of real-time multimedia messaging apps that compete with social networks for users’ valuable time.

The buzz stems from a rumor that Google may be working on a deal to buy the fast-growing messaging app WhatsApp for a cool $1 billion. WhatsApp is among an increasing number of mobile messaging apps that analysts say could threaten social networks such as Google+ and Facebook because they offer real-time messages across smartphone platforms without text messaging charges.

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But those reading the report from Digital Trends should take it with a grain of salt: It cites a single, unnamed source as the basis for a “rumor.”

As usual, the companies themselves aren’t talking. Google spokeswoman Samantha Smith told The Washington Post on Monday that the company doesn’t comment on rumor or speculation. WhatsApp spokesman Neeraj Arora also declined to comment on the report.

Still, the speculation has attracted much attention, implying that there’s at least the perception that Google and Facebook have a hole in their networks that has to be plugged. Mobile has become a crucial focus for social networks, as Facebook acknowledged with last week’s announcement of its new Home suite of apps for Android smartphones.

Digital Trends says that a Google deal with a service like WhatsApp deal would be a “no-brainer,” pointing out that while the tech giant could build its own technology for a similar service, it doesn’t have anything near that kind of reach on mobile messaging. An acquisition would allow the company to pick an impressive bank of users in one fell swoop.

That was the approach that Facebook took with Instagram when it bought the photo-sharing service last year. While Facebook could — and, in fact, did — develop technology that offered the same kind of photo sharing and filtering that made Instagram popular, it would have taken the company some time to build up a competitive network.

WhatsApp, which has devoted users around the world, reported earlier this year that it had processed 7 billion inbound messages and 11 billion outbound messages on New Years’ Day alone. With Facebook now shifting to make mobile its first and best platform, Google should be feeling the pressure to offer its Google+ users a compelling and unique mobile experience. Acquiring a strong mobile messaging service could give it the edge.

(Washington Post Co. chairman and chief executive Donald E. Graham is a member of Facebook’s board of directors.)

 
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