Anonymous sources have told Digital Trends that Google is in negotiations to buy WhatsApp, but the company is pushing for a $1 billion valuation, while Google seems to be wanting to pay less. This "rumor" seems most likely to come from WhatsApp themselves, because they want to make it sound like a "done deal" for $1 billion, in the press. That would probably force Google's hand into buying it at that price.
Google has a few other alternatives they could look into, such as Viber, Line or Kik. However these are much smaller players, and Google isn't looking so much into buying talent or an app, because they could do that themselves. Instead it's looking into getting a huge user base for a cross-platform iMessage competitor, and Whatsapp would be ideal for that purpose, with its 130 million users worldwide.
Google would like to make WhatsApp a big part of their Google Babel app, but we don't know yet how exactly that's going to work. Will Google Babel be just a hub for different services, where you can just switch between the tabs of GTalk, Google Voice, Google+ Messenger, SMS and WhatsApp?
You could access them all in one place, and use only one login for each - you Google/Gmail account - however I'd much rather see a true unification of the services. Basically, I don't want them to simply remain 5 separated services, put into a single app. I want them to be one service, and one service alone. When you'd use Babel, you would be using Babel, not just "WhatsApp inside Babel".
It would take them a bit of hassle to make all of those services merge into just one service, especially when trying to transition people from each one of them to the "Babel" service, but I think it would be well worth it in the end. Plus, it would be a brand they'd control.
From what we've seen from the leaks and rumors so far, though, it seems that Babel will be more like a hub for all these services. So the difference between how the situation is right now with 4-5 different apps for 4-5 different service, is that with Babel you would be using one app instead of 5, but still 5 different services, all synced through your Google account, and across Android, Chrome and iOS. I prefer the merger of services idea, but this would still be a big improvement over the current situation.