The news has been blowing up over the last week about Facebook’s massive buyout of the widely popular WhatsApp. The only problem is that many people haven’t heard of WhatsApp or know what it means for Facebook. It definitely had to be a big deal if Facebook paid 19 billion dollars for it.
What Is It?
WhatsApp is a messaging service that offers an alternative to texting on smartphones for 1 dollar a year after the first year. Currently, WhatsApp has over 450 million users and continues to grow about a million users per day. The reason that many Americans haven’t heard of the application is that it is much more popular in Europe and Asia than in the United States where unlimited texting plans isn’t the norm. It is different than other apps of its kind because it has no ads and no games. It’s revenues are low, but it’s popularity it incredibly high.
What Does Facebook Want to Do With It?
No one really has an exact answer on why Facebook paid so much for this application. There a few educated guesses on why Facebook bought this application come from many market leaders on the internet.
- Facebook needs to get into the social markets into emerging markets: Facebook doesn’t have much room to grow in the United States with such a high number of users. They needed a new way to get into contact with the markets in across the world, and WhatsApp is a direct link to these markets.
- Facebook plans to become the Disney of social media: Facebook may just attempt to buy out as many major social media applications as possible to run the social media world.
- Help Zuckerberg’s internet.org movement: Facebook is part of a movement that is attempting to get 2/3 of the world onto the internet. Through the use of WhatsApp more people could afford to use texting worldwide which could help his cause.
Overall, it is probably a combination of a lot of reasons that Facebook bought WhatsApp for such a large sum of money. What this acquisition really shows is the major power of Facebook in the social media world and a trend beginning of Facebook buying up their competitors.