Depending on whose analysis you read
Wednesday evening and Thursday
morning, Facebook’s decision to acquire
the messaging service WhatsApp for $19
billion was either a terrible idea that
tanked its stock , a bold act of possible
genius, or perhaps a way to get one over
on Google .
WhatsApp itself discussed the deal—$4
billion in cash, $12 billion in stock, and
another $3 billion in restricted stock
that will vest over the next four years—
in terms of what it will mean for its 450
million users.
Here’s what co-founder Jan Koum
wrote on the company’s blog :
Today we are announcing a
partnership with Facebook that
will allow us to continue on that
simple mission. Doing this will give
WhatsApp the flexibility to grow
and expand, while giving me, Brian,
and the rest of our team more
time to focus on building a
communications service that’s as
fast, affordable and personal as
possible. Here’s what will change
for you, our users: nothing.
Koum added that WhatsApp will continue
to cost a “nominal fee,” work on any
smartphone, and be ad-free. That last
point is particularly surprising,
considering that Facebook is now
officially a mobile ad firm, with 53
percent of its revenue coming from
mobile advertising.
“There would have been no partnership
between our two companies if we had to
compromise on the core principles that
will always define our company, our
vision and our product,” Koum wrote.
(Though Koum says the service won’t
change for customers, things have
clearly changed quite a bit for
WhatsApp’s employees, who marked the
occasion with Cristal.)
The reassurances were almost certainly
welcome, but one thing WhatsApp’s
founders may have wanted to add was
some explanation as to just what their
service is. Tweets similar to this one were
not all that uncommon after the
acquisition announcement:
19 billion? What does this mean?
Anything? What the hell is
'WhatsApp'? http://t.co/
XTQ8WlI0wx
— cityofstrangers (@
cityofstrangers) February 20,
2014
WhatsApp is essentially an app that
serves as an alternative to traditional
text messaging. It’s hugely popular
outside North America, particularly in
South American markets and India. In
the U.S., where text messaging is usually
is necessarily part of most cell phone
plans, it’s not as widely used.
The app is a free download and is free
to use for a year. After that it’s $0.99
per year to use.
Facebook paid $42 per user, though. How
did the company explain that? Here’s
what it said in its press release :
The acquisition supports Facebook
and WhatsApp's shared mission to
bring more connectivity and utility
to the world by delivering core
internet services efficiently and
affordably. The combination will
help accelerate growth and user
engagement across both
companies.
Does that sound like things are about to
change for WhatsApp users, in spite of
what Koum said? Please chime in, PR
Daily readers.
Wednesday evening and Thursday
morning, Facebook’s decision to acquire
the messaging service WhatsApp for $19
billion was either a terrible idea that
tanked its stock , a bold act of possible
genius, or perhaps a way to get one over
on Google .
WhatsApp itself discussed the deal—$4
billion in cash, $12 billion in stock, and
another $3 billion in restricted stock
that will vest over the next four years—
in terms of what it will mean for its 450
million users.
Here’s what co-founder Jan Koum
wrote on the company’s blog :
Today we are announcing a
partnership with Facebook that
will allow us to continue on that
simple mission. Doing this will give
WhatsApp the flexibility to grow
and expand, while giving me, Brian,
and the rest of our team more
time to focus on building a
communications service that’s as
fast, affordable and personal as
possible. Here’s what will change
for you, our users: nothing.
Koum added that WhatsApp will continue
to cost a “nominal fee,” work on any
smartphone, and be ad-free. That last
point is particularly surprising,
considering that Facebook is now
officially a mobile ad firm, with 53
percent of its revenue coming from
mobile advertising.
“There would have been no partnership
between our two companies if we had to
compromise on the core principles that
will always define our company, our
vision and our product,” Koum wrote.
(Though Koum says the service won’t
change for customers, things have
clearly changed quite a bit for
WhatsApp’s employees, who marked the
occasion with Cristal.)
The reassurances were almost certainly
welcome, but one thing WhatsApp’s
founders may have wanted to add was
some explanation as to just what their
service is. Tweets similar to this one were
not all that uncommon after the
acquisition announcement:
19 billion? What does this mean?
Anything? What the hell is
'WhatsApp'? http://t.co/
XTQ8WlI0wx
— cityofstrangers (@
cityofstrangers) February 20,
2014
WhatsApp is essentially an app that
serves as an alternative to traditional
text messaging. It’s hugely popular
outside North America, particularly in
South American markets and India. In
the U.S., where text messaging is usually
is necessarily part of most cell phone
plans, it’s not as widely used.
The app is a free download and is free
to use for a year. After that it’s $0.99
per year to use.
Facebook paid $42 per user, though. How
did the company explain that? Here’s
what it said in its press release :
The acquisition supports Facebook
and WhatsApp's shared mission to
bring more connectivity and utility
to the world by delivering core
internet services efficiently and
affordably. The combination will
help accelerate growth and user
engagement across both
companies.
Does that sound like things are about to
change for WhatsApp users, in spite of
what Koum said? Please chime in, PR
Daily readers.
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