I recently described the billions Facebook is paying for WhatsApp as "a king's ransom." But another shoe dropped at the mobile industry's annual shindig, the Mobile World Congress, that may show the real reason for that valuation.
Facebook wants to be the first global telco.
To me, that's the motive behind WhatsApp's announcement that it intends to add voice service to its existing messaging and photo sharing. It's a departure -- voice is inherently synchronous and a much bigger technological deal than asynchronous messaging -- but WhatsApp does have half a billion phone numbers, plus details of where the associated phone is all the time on the Internet.
The tools exist. There are existing open standards and open source software to build on. More importantly, the world already knows how to use the technology. WhatsApp has the same phone numbers that legacy telcos use, but it doesn't need to pay for connection fees across the byzantine and antiquated complexity of the world's analog phone network. It's genius.
This could have happened before. Skype (now owned by Microsoft) could have done it, at least before the accusations of backdoors. Google still could do it; after all, it bought GrandCentral (now Google Voice) to achieve this sort of capability. Google is gradually integrating voice into the rest of its capabilities. Even Facebook has already tried at least twice before. So what has changed?
The main difference is the happy convergence of smartphones and globally available Internet connectivity. When phones were phones and computers were deskbound, the conceptual gap between something like Skype and your mobile phone was huge (like your mobile phone). When smartphones were young, the cost of Internet connectivity was insurmountable. While that may no longer be true in America, mobile Internet charges remain high in much of the rest of the world.
But that's changing. The Internet of things is a nice idea, but it needs a way for those "things" to get on the Internet. This is creating a massive market, and the mobile industry is responding -- with, for example, a spec for virtual SIM cards and with the gradual elimination of data roaming charges. I doubt the mobile industry will be able to resist this market, which ultimately means turning global data roaming into a commodity. Once that happens, the revolution is ready for the first rebel.
In this context, Facebook's move on WhatsApp makes huge sense. Both Google and Microsoft already have the technology and infrastructure in place to operate a global telco. It's a complicated business, circumscribed by endless legacy regulations from the age of copper wires being used by the dinosaurs of telephony to frantically reinforce their fading monopoly.
Facebook may be jumping in at the perfect time. Will it be Google, Microsoft, or Facebook that creates the first true global telco? The race is on.
This story, "With WhatsApp, Facebook looks to become the first global telco," was originally published at InfoWorld.com. Get the first word on what the important tech news really means with the InfoWorld Tech Watch blog. For the latest developments in business technology news, follow InfoWorld.com on Twitter.