Latest Passion

Facebook’s newest acquisition: WhatsApp for $19 billion

Looks like Zuckerberg’s social media company is looking to expand it’s services by buying other companies. In 2012, Facebook purchased the highly popular photo sharing application, Instagram for $1 billion. Today, Facebook has acquired the highly popular instant messaging app, WhatsApp for $19 billion.

The instant-messaging company, WhatsApp has only been around for a few years, so why such a high price tag? First, WhatsApp has been able to successfully compete with other giants in the instant messaging industry such as Twitter and Skype. The reason why they’re able to? The answer to that question would be their user base. There are 450 million users of WhatsApp, while having a growth of over a million users per day.  Daily active users went up to 72%, which is well above the average of only 10-20%. Not impressed? Well if these numbers haven’t, the following fact will. WhatsApp hasn’t employed a marketer or a PR firm at all. Yes, you read right, they don’t have anyone to market for them. The application markets itself, which in today’s world is extremely hard to do.

Facebook has its own messenger application called “Facebook Messenger”, so people might be wondering why would Facebook out of all companies spend that much money on a company when Facebook already has it covered?

The reason is simple. Facebook is bolstering their ability to connect users all around the world. Not only that, but it’s probably to eliminate the competition. Think about it for a second, if you were big enough to completely buy out a company that’s a competitor and to bolster the ranks of your own, why not? Especially when it’s the number one application used in the entire world.

 

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About theoriginaljath (15 Articles)
Jack Hui is the founder of The International Passion. He is currently studying business at York University. He has a passion for food, wine, and watches. You can follow him on Twitter at @theoriginaljath

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