Remember when Facebook purchased Instagram for a billion? Remember when they offered Snapchat 3? Child’s play. Mere child’s play.
Zuck and the crew announced today that they have purchased Whatsapp—a four-year-old smartphone-messaging app with 450 million monthly users—for a cool $16 billion. $12 billion will be dedicated to picking up all of Whatsapp’s stock and options; then $4 billion will be paid out in cash and an additional $3 billion in restricted stock units will be given to Whatsapp’s founders and employees.
As late as 2012, Whatsapp only had 30 employees which means…
… I dunno, we all should have been coders? A few people just got a ton of cash.
Anyway, you’re forgiven if you’ve never used Whatsapp, or even heard of it. The service is based in Mountain View, California but has found most of its success in Europe and South America, where users pay $0.99 a year to send text messages for free over the Internet. This bypasses wireless carriers that charge per text sent, and you can probably see how the service would be super-useful for people who text across national boundaries or deal with unreliable carriers. As Zuckerberg said today:
“WhatsApp is on a path to connect 1 billion people,” says Facebook CEO Mark Zuckerberg. “The services that reach that milestone are all incredibly valuable I’ve known [CEO] Jan Koum for a long time and I’m excited to partner with him and his team to make the world more open and connected.”
If instant messaging is the future of tech, as some have speculated, then Facebook just made the most significant investment of any of its rivals. It may have just beat them all for good, too. As Buzzfeed said in a report on WhatsApp last year: “‘I’ve seen data from companies that do device and behavioral analysis, and the figures are jaw-dropping,’ Forrester research analyst Charles Golvin told BuzzFeed’s Charlie Warzel. ‘In places like Brazil, Mexico, Spain… 25% of the time people spend on smartphones, they’re spending in WhatsApp. The number is variable for each of those countries, but it is of that magnitude.’”
On a related note, shoutout to the BBC for reporting the news right:
Oh dear. Most unfortunate. pic.twitter.com/wcfUeadplP
— Matt Wells (@MatthewWells) February 19, 2014
Rub and tugs for everyone at FB HQ!