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Facebook Gets WhatsApp

When Facebook disclosed in mid-February that they had bought the messaging application WhatsApp, they had people asking “Who’s WhatsApp and why are they worth buying?”

FB purchased the firm with a combination of cash, stock and shares for a total of $19 Billion. While other parts of the world were pretty familiar with the WhatsApp application, that was not so much the case in America. But the fact is that at the time of its acquisition by Facebook, WhatsApp had 450 million users and that user list was multiplying rapidly.

The buying of WhatsApp gave Facebook a huge messaging footprint in areas where they were lagging behind. Blogger Gary Warner states,  “Apparently WhatsApp has been growing in popularity in other parts of the world, as documented by a survey released in November by OnDevice Research which was headlined as Messenger Wars: How Facebook Lost Its Lead,  which talked about the top Social Message Apps for mobile devices in five major markets: US, Brazil, South Africa, Indonesia, and China. While Facebook still led in the US, and WeChat clearly dominates China, WhatsApp was the leading app in Brazil 72%, South Africa (68%), and Indonesia (43%).”

WhatsApp designed a crowd pleasing smartphone application that lets people using a variety of devices –  like iPhones and Android phones –  to text and send pictures seamlessly without having to pay for the fees carriers charge for SMS messages. It does have a miniscule price tag. It’s is free for the the first year, then it costs a dollar each year after that.

Handling this new member of its family like it handled Instagram, Facebook plans to let WhatsApp operate largely as an independent firm. But Facebook will capitalize on what WhatsApp will bring to the table in mobile phone reach and in opening up doors that were closed in China (where Facebook is blocked, but Instagram and WhatsApp are allowed in.)

There are some concerns about what doors the acquisition will open for spammers. In his blog written for the site Cyber Crime and Doing Time, Warner says that folks who keep track of spam and email threats have heard the name WhatsApp in the wind for months and call it a popular spam lure. He states. “At least three distinct spamming groups have already used WhatsApp as a lure for their scams.”

But Jan Koum, who started WhatsApp, answers that concern on the WhatsApp Blog by saying, “We don’t know your likes, what you search for on the internet or collect your GPS location. None of that data has ever been collected and stored by WhatsApp, and we really have no plans to change that,” he went on to say, “Everything that has made WhatsApp the leader in personal messaging will still be in place. Speculation to the contrary isn’t just baseless and unfounded, it’s irresponsible. It has the effect of scaring people into thinking we’re suddenly collecting all kinds of new data. That’s just not true, and it’s important to us that you know that.”

Koum is now a director with Facebook. On the life-is-Karma side of things, years ago Koum applied to work at Facebook, but didn’t get the job.

Sources:
http://www.businessweek.com/articles/2014-02-19/facebook-acquires-whatsapp-for-19-billion

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