Kavin-Mittal’s Hike Acquires US-Based Zip Phone

by CXOtoday News Desk    Jan 09, 2015

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One of India’s leading instant messaging platform Hike Messenger, has acquired US-based Zip Phone, a company that offers free voice-calling service. The acquisition will help Bharti Enterprises Group CEO Sunil Mittal’s son Kavin Mittal, who is heading Hike to boost its product range in internet-based communication through launch of voice-calling services.

Launched in December 2012, Hike Messenger claims to have more than 35 million users and has raised $86 million from Tiger Global and Bharti SoftBank, a joint venture between Bharti Enterprises and Japan’s SoftBank Corp. On the other hand, Zip Phone, founded in the US by Anuj Jain, offers a voice-calling app that works globally. The company was part of the 2014 summer batch list of the prestigious Y Combinator, a US-based seed accelerator that also picks up equity stakes in start-ups.

Hike Messenger founder & chief executive officer Kavin Mittal said: “From day one, we have strongly believed we can bring India online through communication. With this acquisition, we take another step towards that mission. Zip Phone’s technology will allow us to bring free voice calling to the market much faster.”

He added that incidentally, this is one of the features most requested by our users. 

In the instant-messaging space, Hike competes with WhatsApp (acquired by Facebook last year), WeChat and Japan’s Line. With about 70 million active users, WhatsApp is the market leader in India.

In voice calling through applications in India, Skype is the market leader at present. Other applications like Viber and Line are also present in this segment. Another key player Nimbuzz claims to have more than 40 million users in India.

According to a recent study by GlobalWebIndex, 52 percent of Indian instant-messaging users avail of WhatsApp’s service, while 42 percent use Facebook Messenger. Skype is used by 37 percent, WeChat by 26 percent, Viber by 18 percent, Line (12 percent), Snapchat (9 percent). Hike does not feature on the GlobalWebIndex list.

Experts believe voice calling services on internet; can hit telecom operators’ revenues from voice, which currently accounts for 80 percent of their overall earnings in India, in a big way. As such, instant messaging has already affected text messaging as a revenue earner for telecom operators, whose revenue dropped to about five percent as at the end of March 2014, a 50 percent decline from its preceding quarters.