Facebook Acquires Whatsapp for $19 Billion

Recent Media Buyouts

These past few weeks has been full of mergers and buy-outs. It all started with Google buying Nest, then Comcast buying Time Warner and finally Facebook acquiring WhatsApp. I am sure there were more companies that played a what would seem like game of Monopoly, but those three have been the talk online.Image

Brief Into: WhatsApp

If you are not familiar with WhatsApp, here is a brief introduction. WhatsApp is an app that connects people from all parts of the world together for free* (until near the end of 2013 they decide to charge .99 a year). WhatsApp can be downloaded to any smartphone platform. All you users would need would be a phone number. Through WhatsApp you are able to send and receive text message as well as voice messages as well. WhatsApp is similar to the Blackberry Messenger and Voxer combined.

Since, we have that out of the way let get down to business. Founder of Facebook, Mark Zuckerberg signed a $19 Billion deal with Jan Koum and Brian Acton on Feb. 19th in front of a welfare building Koum visited often as a young adult (you can read his rags to riches story here). There are numerous articles on the internet that is speculating that Facebook paid too much for Whatsapp and that it was a huge gamble, but I am not a business analyst so I will not get into those details. However, I would like to go in to what this recent transaction can mean to social media and smartphones.

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What does this all mean?

There is no surprise that Facebook tried to get into the smartphone business a few years ago and to their dismay it didn’t work out. Well Zuckerberg is definitely not a quitter. I believe this new addition will prepare Facebook to try the smartphone route again. However, not as an app, but as a UI (Android, iOS, Windows, etc…). WhatsApp can be that missing messaging feature that Facebook could use as their SMS system and potential call feature. The mobile & smartphone industry is worth an estimated $150.3 Billion. Not to mention how quickly consumers trade phones and how technology for these phones are rapidly improving.

The Famous Rumor Mill

On a different note, there are rumors circulating about Twitter partnering up with American Express to allow tweeters to use their hashtags as money (http://www.cnn.com/2013/02/11/tech/social-media/twitter-hashtag-purchases/). Which brings up another opportunity for Facebook to do the same with WhatsApp. BusinessInsider covered a story about a similar Chinese app called WeChat that so far allows their users to purchase food items from vending machines! You can read more here .

Tell me what you think this move means for Facebook and the future of Social Media in the comments below, Also, don’t forget to subscribe to my blog and other social media channels.

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I am a recent college graduate from University of Texas-San Antonio. I received my BA degree in Communications with a minor in Business Administration in May 2011. I enjoy keeping up with my favorite gossip blogs, reality television shows, and of course the social media.

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