If Facebook’s Not Buying WhatsApp, It Sure Seems Like It’s Building It

Next Story

Microsoft Awards Imagine Cup Grants To 5 Innovative Student Developer Teams

So we hear rumors that Facebook is looking into buying messaging app WhatsApp. We do a post on it, writing simply that we are hearing those rumors and that Facebook might be interested in acquiring the startup.

At the time we had little idea of when this discussion happened, or any other details, but found it fascinating that Zuckerberg might be pursuing the world’s largest messaging startup. We wrote that we heard Facebook was interested, because that in and of itself was interesting.

Others refuted our post, and so did both companies – vaguely. Sources did tell Liz Gannes that Facebook had wanted to buy the startup, which is the market leader in the free messaging space, at some point in “the past.”

And then this morning, Facebook conspicuously announces the launch of its own WhatsApp competitor, the new Messenger on Android, which is functional without a Facebook account or email address and lets non-Facebook users sign up with just a name and phone number. It is clearly an attempt to appeal to international audiences with feature phones and is initially available to only India, Australia, Indonesia, Venezuela, and South Africa. While it’s not available on feature phones today, it will be eventually. And it is free.

So why make Messenger available to people not on Facebook (a first for any Facebook product)? “We want to make people connect to each other,” Facebook’s Peter Deng said today on stage at LeWeb, emphasizing that mobile-messaging traction is Facebook’s No. 1 goal. Sure, connect to each other through Facebook. “Maybe they’d then want to try other parts of the Facebook product [after Messenger]?” he said.

Okay, it sure seems like Facebook wants to get into the wider message space considering today’s launch, so apparently the discussions were recent enough to matter. And I’ll be a monkey’s uncle if Zuck didn’t 100 percent try in some capacity to buy WhatsApp. Especially since Facebook has a history of doing this with competitive products.

In fact, Dalton Caldwell called this strategy “formulaic” in a post he wrote about Facebook trying to acquikill his startup App.net with App Center. Caldwell asserted that this kind of strong-arming wasn’t an isolated incident.

Your executives explained to me that they would hate to have to compete with the ‘interesting product’ I had built, and that since I am a ‘nice guy with a good reputation’ that they wanted to acquire my company to help build App Center.

It is likely that Facebook tried to scoop up WhatsApp just like it tried unsuccessfully to buy App.net, and tried (successfully) to buy Instagram around the time it launched Facebook Camera, and tried (again successfully) to buy Karma around the time it launched Gifts. Because Facebook basically tries to buy almost everything that has explosive mobile traction, especially when it’s got its own internal efforts to expand in the sector.

Another rumor (gasp!) I’ve heard is that there is a certain sheet of paper with a list of the top 50 apps in the App Store, and the Facebook M&A department just runs down the list calling the founders into “get to know you” meetings. I have no idea whether this is true or apocryphal. Anyways, I wouldn’t be surprised.

From what I’ve heard, the WhatsApp founders simply just don’t want to sell. That resolve possibly didn’t crumble when faced with a (again, hypothetical) “Here’s a term sheet or we’re going to kill you” situation.

When I asked Peter Deng backstage after his talk whether the WhatsApp rumors might be related to this clear attempt to compete with it, he told me, as expected, that the company did not comment on rumors and speculation. Hey, it was worth a shot.

“We’re investing a lot into mobile messaging,” Deng said completely unsurprisingly onstage. Moderator David Kirkpatrick, founder and CEO of Techonomy Media, did not ask him specifically about WhatsApp, as either a competitor or acquisition target.

Facebook wants to release the free, phone-number-based Messenger on iOS and to the greater global market as soon as possible, Deng said. It remains to be seen whether this new, more plebeian Messenger can steamroll WhatsApp, challenge iMessage, and replace the old mainstay SMS. Keep an eye on it. ;)