Business /
Facebook Buys WhatsApp For 19 Billion Dollars
Mark Zuckerberg, Facebook founder and CEO is determined to stay ahead of the user-technology curve, but will the cost be worth it?
Wednesday, Facebook announced its largest acquisition ever, $16 billion for WhatsApp, a rapidly growing cross-platform mobile text messaging application with 450 million users worldwide who pay little or no money for its use.
Meanwhile, Facebook will pay $4 billion in cash and $12 billion worth of shares for WhatsApp, the ultimate cost of the deal could likely rise to $19 billion, with WhatsApp employees and founders receiving an additional $3 billion in restricted stock units.
Claiming similar missions, to connect as many people as possible while also delivering core internet services efficiently and affordably, both Zuckerburg and Jan Koum, former Yahoo exec and WhatsApp co-founder/CEO (The other is Brian Acton) believe the acquisition will accelerate growth and user engagement across both companies.
WhatsApp’s founders Brian Acton, left, and Jan Koum at its offices in Mountain View, Calif. /Peter DaSilva for The New York Times & Facebook CEO Mark Zuckerberg /TechCrunch Disrupt
Apparently, Zuckerberg believes acquiring hot messaging technologies is also worth the hefty price tag, in order to gain traction with a younger generation of social network users.
Now a 10-year-old social network of 1.2 billion users globally, Facebook’s popularity has become commonplace that it risks losing the attention of users, but in in buying WhatsApp, which is growing faster Twitter rival, Facebook gains access to a huge customer base. WhatsApp’s messaging volume is fast approaching the volume of all text messages sent globally, a number estimated to be as high as seven trillion messages sent on WhatsApp a year.
"WhatsApp is on a path to connect 1 billion people. The services that reach that milestone are all incredibly valuable," said Zuckerberg. "I've known Jan for a long time and I'm excited to partner with him and his team to make the world more open and connected."
In return Koum stated that “WhatsApp's extremely high user engagement and rapid growth are driven by the simple, powerful and instantaneous messaging capabilities we provide. We're excited and honored to partner with Mark and Facebook as we continue to bring our product to more people around the world.”
Facebook’s company operating platform, allowing independent-minded entrepreneurs to build and run their own companies while benefiting from Facebook’s expertise, resources and scale means that WhatsApp will follow the lead of Instagram, acquired in 2012, and continue to operate under the WhatsApp’s brand from its original headquarters in Mountain View, CA. Jan Koum will join Facebook’s Board of Directors; and WhatsApp’s core messaging product and Facebook’s existing Messenger app will continue to operate as standalone applications.
Featured Image:echzim.co.
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