Facebook has bought the messaging app, WhatsApp in a deal worth a total of 19 billion dollars in cash and stock.
In a landmark deal, world’s largest social network Facebook has bought the most loved messaging app WhatsApp for 16 billion dollars in cash and stock, seeking to expand its reach among users on mobile devices. The accord includes 12 billion dollars in stock, 4 billion dollars in cash and 3 billion dollars in restricted shares. The said purchase is the biggest Internet deal since Time Warner’s 124 billion dollar merger with AOL in 2001.
Explaining the fairy tale acquisition, Facebook founder Mark Zuckerberg said, “Our mission is to make the world more open and connected. We do this by building services that help people share any type of content with any group of people they want. WhatsApp will help us do this by continuing to develop a service that people around the world love to use every day. WhatsApp is a simple, fast and reliable mobile messaging service that is used by over 450m people on every major mobile platform. More than 1m people sign up for WhatsApp every day and it is on its way to connecting 1bn people. More and more people rely on WhatsApp to communicate with all of their contacts every day”.
WhatsApp was founded by a Ukrainian immigrant who dropped out of college, Jan Koum and a stanford alumnus, Brian Acton and the app quickly skyrocketed to over 450 million users in five years and kept adding another million on a daily basis. WhatsApp allows users to send messages, images and videos over internet connections and makes money by charging users a subscription fee of 1 dollar a year.
Going forward, WhatsApp will continue to operate independently and autonomously within Facebook. “Over the next few years, we’re going to work hard to help WhatsApp grow and connect the whole world. We also expect that WhatsApp will add to our efforts for Internet.org, our partnership to make basic internet services affordable for everyone. WhatsApp will complement our existing chat and messaging services to provide new tools for our community. Facebook Messenger is widely used for chatting with your Facebook friends, and WhatsApp for communicating with all of your contacts and small groups of people. Since WhatsApp and Messenger serve such different and important uses, we will continue investing in both and making them each great products for everyone”, Mark Zukerberg said.
Mark Zuckerberg who bought the photo sharing service Instagram for about 700 million dollars has been adding application such as messaging and news to court smartphone and tablet users. And it’s latest acquisition over WhatsApp has made an even stronger statement about Facebook’s future vision and roadmap. They are willing to broaden their portfolio of apps and not just rely on the social network to reap profits. The widened portfolio of apps will enable Facebook to reach people with different use cases, different demographics or different ways of communicating.