So last night it was announced that Facebook has bought WhatsApp for $18 billion after reportedly turning down a $10 billion offer from Google.
This move has made billionaires of the co founders Jan Koum and Brian Acton, this amount of money is almost incomprehensible as a relative figure so let us compare this to the mere $1 billion Facebook paid for Instagram back in 2012, which at the time was the groundbreaking as an app was being purchased by another company.
So why would Facebook pay so much?
WhatsApp has 450 million users, and these are mostly active users, while we are tweeting, double the amount of messages are being sent via WhatsApp.
WhatsApp is making private messaging cool, Facebook made publicly sharing your life cool, so much that there are now issues around privacy and as parents go on Facebook and embarrass their children the younger generation seek something more private. This came in the form of WhatsApp.
WhatsApp has captured the demographic that are currently leaving Facebook so by purchasing it, Facebook has control over every opportunity to get in front of people, great for their advertisers.
Privacy concerns have been following Facebook for some time and this may be partly why messaging networks are becoming more popular, but the trends are definitely shifting, we could see the impact WhatsApp and Messaging services are having on social media when other platforms follow suit. Facebook Chat, Instagram Direct and Twitter expanding their Direct messaging to include images. SnapChat has become more popular and anyone that has been paying attention can see that privacy is the new social.
There are plenty of rumors as to why Facebook have paid so much, is it because of those 250 million users, they now have 250 million phone numbers? Is it just to get one over on Google? Do they have plans to develop WhatsApp further or bury the competition?
At this stage it is hard to tell, but co founder Jan Koum has been appointed a position on the board at Facebook which to me means he will be bringing his ideas to the table as well as just the app.
Facebook Missed the boat
As with any good tale one of our heros has a sob story that has finally come to fruition, Brian Acton, co founder of WhatsApp, had actually been turned down for a job at both Facebook and Twitter in 2009. The developer had previously worked at Yahoo and tweeted that both big names had not hired him after interview.
Turns out not realising this candidates potential was a costly mistake by Facebook. It also seems that Brians positivity paid off as we can assume he went on to be more successful as a start up than if he had taken a role within either company.