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Facebook Purchases WhatsApp For $19 Billion
Wed Feb 19, 2014 12:53:30PM |
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Facebook announced the acquisition of the popular text service WhatsApp for the bargain price of $19 billion dollars in a deal that seemed to catch everyone off guard. While many Americans have never heard of the company, WhatsApp is hugely popular outside of the United States and it is not surprising that Facebook is trying to expand their market share into areas outside of America.
Not surprisingly, numerous individuals are wondering how the two companies settled on a price that high for a free service that does very little advertising. Mark Zuckerberg has brushed off those questions and even claimed that WhatsApp is "worth more than $19 billion" in a recent speech.
This does bring up the question of how Facebook will monetize a free service like WhatsApp. If they take the same route that they did with monetizing Facebook, then users should be ready for a bombardment of advertisements catered towards their every need and desire. I also would not be surprised if Facebook phases in some type of payment plan that is more expensive that currently available for its users. WhatsApp is currently free for the first year and just .99 cents a year after that.
This is just another in a growing list of companies that Mark Zuckerberg and Facebook have been acquiring in the past few years as they try to flex their muscles into the ever growing share of the mass communication market. With the stroke of a pen, Facebook basically doubled its user opportunity. That, and they now have a foothold in nearly every corner of the world.
It should be quite interesting to see how Facebook handles its new acquisition. I wonder if they will phase it into an all encompassing, ever expanding Facebook, or if they will keep all of their new purchases separate to maximize profit potential. My guess is that they will keep them all separate for the time being, but who knows what the future brings.
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