Users of social media have taken to Twitter and Facebook, among other platforms, to voice their opinion that the decision of Alibaba, the Chinese e-commerce giant, to invest into Tango, a free mobile messaging service app, is a copycat investment stake rather than competition.
Alibaba Group Holding Ltd. would spend $215 million for a 20 percent stake in the American company, making it the leading investor of a total $280 million funding plan. The remaining $65 million has been invested into Tango by other investors. To date, Tango has raised $367 million in venture capital financing, including the new round. At present, Tango boasts of 200 million registered members, with 70 million active users, and has been valued around $1.1 billion.
The decision of Alibaba to invest into Tango has come a month after Rakuten, a Japanese e-commerce company, announced that it was buying Viber, one of Tango’s main rivals, for $900 million. Prior to this, just weeks ago, Facebook acquired WhatsApp, in a surprise $19 billion deal.
The sudden importance of messaging apps for the technology industry and the quick succession of investments has social media talking. The acquisition of Whatsapp had tongues wagging as many wondered if the deal was worth it. The acquisition of Viber was gentler. However, this third strike into instant messages app by a giant has people wondering whether it is about competition anymore. Social media took today to call Alibaba’s investment into Tango a copycat stake.
Twitter user, Lily Kuo, tweeted, “Alibaba’s $215 mln Tango stake is about copying, and not competing.” Andrew Yochum, who tweets by @yochum, tweeted, “Alibaba wages $215 million to dance with messaging app tango on the heels of WhatsApp’s $19 billion.”
Blogger Kerry Dolan said the fact that Alibaba had decided to invest into Tango on the heels of Facebook and Rakuten made it seem like it was a “hurried decision.” She said that even though it is yet to be seen how these investments would benefit the end-user, the technology firms are making “some real good money.”
Some twitter users said the investment into Tango was a better decision of Jack Ma, the executive chairman of Alibaba, than it had been when it got into Yahoo! On the flip side, others wondered on the sanity of the chairman and questioned his business decisions. For them, investing into Tango, which has only 70 million active users, is a bad investment decision. Meanwhile, tech enthusiasts all over the world were quick to spread the news on their social media home pages. Many expressed surprise in their comments following the shares or tweets.
On a positive note, even though social media has called Alibaba’s invest into Tango a copycat stake, this new acquisition by the Chinese e-commerce giant has been termed a revolutionary new development and a milestone for the burgeoning information industry by experts in the field. They said even though apps like Tango, WhatsApp and Viber are threats to traditional phone service carriers, the flurry of deals underscore a surge in confidence by investors in the money-making possibilities of mobile messaging services.
By Faryal Najeeb
Tweets of Twitter users
Status updates of Facebook users