Viber performance exceeded expectations, user base data pretty bright eye

According to foreign media reports, Japan's electric business giant Lotte (Rakuten) in February this year to smash 900 million of dollars to buy mobile communications services Viber, the industry's big surprise. The deal's announcement was five days earlier than Facebook's 19 billion-dollar WhatsApp for another chat app--WhatsApp, an undisputed industry leader with more than 500 million-month active users, but Viber's performance is not bad, beyond expectations.

Rakuten's latest earnings report showed that Viber currently has 400 million independent users, a significant increase from 280 million at the end of 2013-although Rakuten said Viber had 608 million registered users, an estimate that included duplicate downloads and users.

The user base data is pretty bright and close to line. Line currently has a registered user of close to 500 million and is preparing for an IPO that will be listed in Tokyo or New York, or both. It was reported that the service was valued at about $10 billion trillion-more than 10 times times the price of Rakuten's Viber purchase.

However, there is a big difference between Viber and line. Line already has a significant revenue performance – it has achieved net revenue of $177 million in the last quarter, but it has not disclosed profit and loss figures. The success of its model also seems to inspire Rakuten, which is trying to make Viber a similar, multimedia content-centric product.

Lotte CEO Sam Mikitani (Hiroshi Mikitani) talked about Viber's "explosive growth" at the start of today's earnings call. He says Viber downloads are soaring in India, Russia, Latin America and Southeast Asia. Rakuten wants to integrate its electric business services into the Viber application is no secret, the three wood Mikitani is that the combination can "completely change the growth of Rakuten business model."

Given Rakuten's market capitalisation of more than $16 billion trillion and half a year's revenue of $2.7 billion trillion, his tone is not small.

And around the chat experience to create multimedia, electric business, such as line, KakaoTalk and other applications, the three wood Mikitani plan to Viber integration of more services, so that Lotte can establish more direct contact with users, while driving revenue growth.

Rakuten has not integrated any services at the Viber end user level, the app currently generates revenue only by selling emoticons and Skype international calls, but its commercial prospects are promising, with Rakuten spending 900 million of dollars to buy it back seems like a good deal, especially given the generally high valuations of other mobile communications applications. For example, it is said that the Snapchat valuation of the "Burn after" service, which has not yet been able to generate revenue and has fewer registered users, could be as high as $10 billion.

However, for Rakuten, the real problem is that Viber has never been involved in games, electricity, finance and other fields. Those are unfamiliar to it.

The introduction of services that are not aligned with the original core user experience is likely to cause dissatisfaction among some loyal users, making them switch to applications that match their experience needs. Therefore, it is not easy to turn the 400 million Viber users into Rakuten users.