WhatsApp Inc., the instant-messaging service being bought by Facebook Inc. (FB) for $19 billion, plans to add a voice function in the second quarter in a bid to make its application more attractive.
The capability will first be offered on iPhone and Android devices, with Windows and BlackBerry following, WhatsApp Chief Executive Officer Jan Koum said at the Mobile World Congress in Barcelona today.
“We want to make sure people always have the ability to stay in touch and call their friends, families and loved ones and do it easily and affordably,” Koum said. “We think we have the best product out there, using the least amount of bandwidth and we optimize the hell out of it.”
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WhatsApp, based in Mountain View, California, is popular in a crowded field. It competes with apps from Twitter, Kik Interactive Inc. and Snapchat Inc., a startup that rebuffed a $3 billion Facebook bid last year. Other similar apps include Telegram, backed by Pavel Durov, creator of Russia’s largest social network, Tencent Holdings Ltd. (700)’s WeChat in China, KakaoTalk in Korea and Line in Japan -- and Facebook’s own Facebook Messenger.
WhatsApp would be the biggest purchase yet for Mark Zuckerberg’s Facebook and the most expensive for an Internet company in more than a decade. It gives WhatsApp, which has about 50 workers, roughly the same valuation as Gap Inc. (GPS), with about 136,000 employees, and more than half the market value of microblogging service Twitter Inc. (TWTR)
Based on what Zuckerberg said was a goal of bringing WhatsApp subscribers to 1 billion, Facebook would be buying the mobile application for about 19 times estimated sales, according to data compiled by Bloomberg.
The deal is for $12 billion in stock, $4 billion in cash and $3 billion in restricted shares, according to a statement from Facebook. The purchase would dwarf Facebook’s acquisition of the photo-sharing service Instagram in 2012.
Dutch phone company Royal KPN NV’s German unit E-Plus, which is to be sold to Spain’s Telefonica SA pending regulatory approval, said today that it’s agreed a partnership with WhatsApp and plans to introduce a WhatsApp offer this spring. It’s WhatsApp’s first “mobile virtual network operator” co-operation agreement with a mobile carrier, E-Plus said in a statement.
“Together with E-Plus, WhatsApp will offer an attractive mobile communications product,” E-Plus said. “This will allow the E-Plus Group to gain a data-savvy customer group and to further expand its data-focussed business model.”
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