This One Tweet Explains Why Rakuten Paying $900 Million For Viber Was A Mistake

Earlier today, Japanese e-commerce company Rakuten announced that it would be buying Viber for $900 million. Rakuten CEO Hiroshi Mikitani explained that the messaging app could be used as a way for customers to talk with an online store about a purchase.

GigaOm's Om Malik thinks there's a big problem with that::

How is Rakuten going to turn people who use Viber to cheap out on calls/SMS to spend big dollars on e-commerce, especially in emerging mkts

- Om Malik (@om) February 14, 2014

So what is Viber? It's an app that enables people to make free phone calls and send an assortment of messages to other users within the network. It's used by 200 million people to chat with each other.

Malik's tweet argues that Rakuten made a foolish move buying the company, since it doesn't know how to monetize it. The popularity of messaging apps in emerging markets is beginning to explode - millions of people use these apps to send photos, videos and more to their friends especially since these services are free.

Other responses to Om's tweet offered possible strategies Rakuten could take to make this acquisition pay off. To read the rest of the thread, click here.