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Facebook to Acquire WhatsApp
Facebook today announced that it has reached a definitive agreement to acquire WhatsApp, a rapidly growing cross-platform mobile messaging company, for a total of approximately $16 billion, including $4 billion in cash and approximately $12 billion worth of Facebook shares. The agreement also provides for an additional $3 billion in restricted stock units to be granted to WhatsApp’s founders and employees that will vest over four years subsequent to closing.
That Facebook bought WhatsApp is less of a surprise than the sheer amount it has been willing to pay for it.
Some are seeing the $19bn price tag as further evidence of swollen valuations of companies as the sector experiences what may yet prove to be another dot com bubble.
WhatsApp does give Mark Zuckerberg inroads into international markets and, as importantly, to a younger demographic. But what is less clear is whether the finances will add up in the long-term.
WhatsApp has reiterated its commitment to an ad-free service, opting to charge users a mere $1 per year. Under this scenario, it will need to continue its growth trajectory to ensure any financial return to Facebook.
But Adverts are pivotal to Facebook's own business model - and the pressure for it to monetise its new WhatsApp user base in the same way may prove too tempting to resist.
This is what my 17 year old niece uses in place of FB. And Instagram + a few other I'm not aware of, no doubt.
MZ must be reading these posts :) [webmasterworld.com...]
WhatsApp has around 50 employees in total.
Nerds certainly rule the world now.