Indian messenger Hike acquires Y Combinator’s Zip Phone to add free voice calling

India’s homegrown instant messenger Hike has just acquired US-based voice-calling company Zip Phone, a Y Combinator startup. Hike is planning to launch free voice calling soon, and this first acquisition by the Indian company is a step in that direction.

“Our mission from the get go has been to bring India online and we believe communication is at the center of that. With voice calling, we’re taking one more step towards that mission,” says Kavin Bharti Mittal, founder and CEO of Hike.

To a question on how this new feature on Hike will be different from voice calling through Skype, Mittal tells Tech in Asia:

With Zip Phone’s technology we’ll be able to build a very bandwidth efficient voice calling stack which we believe is very important for a market like India.

US-based Anuj Jain developed the Zip Phone app which works globally. The app automatically detects your contacts and intelligently routes calls through 3G or WiFi. You never have to open the app, except once after installation. It promises to deliver clear audio even at low bitrates. Also, all conversation is encrypted for privacy.

Zip Phone was part of Y Combinator’s summer batch of 2014.

One of India’s highest funded startups of 2014, Hike launched in December 2012. It has raised US$86 million from Tiger Global and Bharti SoftBank (BSB), a joint venture of Japan’s SoftBank and India’s Bharti Enterprises.

Hike has over 35 million users currently, while its global biggie WhatsApp is leading in India with over 70 million active users. Globally, WhatsApp has over 700 million active users.

Messaging apps are very popular in India where smartphone users are growing exponentially. “There are a billion people in this country who will come onto the internet for the first time in their lives and that too on a low-end smartphone. We haven’t seen this large a mobile-first scale anywhere globally. As a result, there is a fundamental lack of understanding as to what the internet is for most people in the country. We believe that through messaging, we solve this problem,” Mittal told Tech in Asia in an earlier interview.

To win in this market, Hike has been localizing heavily with features like “hidden chat” for teenagers to want to converse secretly with friends, away from prying eyes of parents and others.

Mittal says that voice calling is one of the top requested features from Hike users. “We can’t wait to launch this,” he says. But in India, telecom majors are crying wolf over VoIP providers eating into their revenues. A few weeks ago, Indian telecom company Airtel announced a plan to charge customers for data usage on instant messaging and VoIP apps like Skype, Viber, Whatsapp, and Line. The move drew heavy fire from users and Airtel was forced to temporarily withdraw the decision to charge a higher rate for making online voice calls on its data network at its discretion. Interestingly, Kavin Bharti Mittal, the founder of Hike, is the son of Sunil Bharti Mittal, founder and owner of Airtel.

To a question on Airtel’s moves, Kavin Bharti Mittal only said: “We’re watching this space carefully.”