“Hey, can I add you on Facebook, if not should we just connect on Whatsapp?” – One stranger to the other. That has been the impact of Facebook and Whatsapp when it comes to the people today. Right to say, that the two have revolutionised the way that people connect with each other and stay in touch. And now, as the two are set to become one, no wonder there have been bubbles of excitement floating in the tech space.
Facebook has announced it’s intentions of buying the popular cross messaging client Whatsapp for $19 Billion. Yes, you read that right. Needless to say, Whatsapp has been the biggest IM client in the world when it comes to user base while Facebook has been the number one Social Networking app. Whatsapp has been ad free so far and there are few itchy feets, suggesting that maybe that will change with Facebook’s revenue model heavily revolving around advertising. However, if that would happen is not clear, and the only solace we can take out is, despite acquiring Instagram, Facebook has not changed anything drastically so hopefully Whatsapp will be left as it is. Facebook did say though, that Whatsapp will continue to operate independently and that there is no plans to merge it up with Facebook Messenger.
The 19 Billion Dollar deal will be in the form of both cash and stock options, while there are $3 Billion worth of stocks to take away for the Whatsapp employees who stay on board for the next four years post the acquisition. With over 450 Million people using Whatsapp everyday, the deal definitely has Mark Zuckerberg excited. He said the following on his Facebook page:
I’m excited to announce that we’ve agreed to acquire WhatsApp and that their entire team will be joining us at Facebook.
Our mission is to make the world more open and connected. We do this by building services that help people share any type of content with any group of people they want. WhatsApp will help us do this by continuing to develop a service that people around the world love to use every day.
WhatsApp is a simple, fast and reliable mobile messaging service that is used by over 450 million people on every major mobile platform. More than 1 million people sign up for WhatsApp every day and it is on its way to connecting one billion people. More and more people rely on WhatsApp to communicate with all of their contacts every day.
WhatsApp will continue to operate independently within Facebook. The product roadmap will remain unchanged and the team is going to stay in Mountain View. Over the next few years, we’re going to work hard to help WhatsApp grow and connect the whole world. We also expect that WhatsApp will add to our efforts forInternet.org, our partnership to make basic internet services affordable for everyone.
WhatsApp will complement our existing chat and messaging services to provide new tools for our community. Facebook Messenger is widely used for chatting with your Facebook friends, and WhatsApp for communicating with all of your contacts and small groups of people. Since WhatsApp and Messenger serve such different and important uses, we will continue investing in both and making them each great products for everyone.
WhatsApp had every option in the world, so I’m thrilled that they chose to work with us. I’m looking forward to what Facebook and WhatsApp can do together, and to developing great new mobile services that give people even more options for connecting.
I’ve also known Jan for a long time, and I know that we both share the vision of making the world more open and connected. I’m particularly happy that Jan has agreed to join the Facebook board and partner with me to shape Facebook’s future as well as WhatsApp’s.
Jan and the WhatsApp team have done some amazing work to connect almost half a billion people. I can’t wait for them to join Facebook and help us connect the rest of the world.
Mark revealed in a phone call to investors post the news broke out that he had approached Koum, the CEO of Whatsapp on February 9th and the two agreed the price a few days later for the deal. Koum will be joining Facebook as one of the Board of Directors.
It has certainly been an interesting journey for Brian Acton and Jan Koum as they get ready for the deal. Acton had been searching for work, and after being rejected by both Twitter and Facebook he started to work on Facebook. Today, he is set to sell the same work for $19 Billion. How times change.
Got denied by Twitter HQ. That’s ok. Would have been a long commute.
— Brian Acton (@brianacton) May 23, 2009
Facebook turned me down. It was a great opportunity to connect with some fantastic people. Looking forward to life’s next adventure.
— Brian Acton (@brianacton) August 3, 2009
We will be bringing you more on the acquisition as more details are surfaced, so do stay tuned.