whatsapp

Facebook Announces Deal to Purchase WhatsApp for Whopping $16 Billion

February 19, 2014 - Written By Eric Abent

If Facebook is still trying to make a splash in the mobile space, the company’s next move is sure to help. The social media giant announced today that it plans to purchase messaging app WhatsApp for more than $16 billion. That figure includes $4 billion in cash – which can’t be considered a paltry sum by any stretch of the imagination – and $12 billion in stock, with another $3 billion in vested stock that will go to WhatsApp’s current employees.

WhatsApp has become a giant in its own space in recent years, and these days it’s able to boast 450 million monthly active users, with 320 million of those users active on a daily basis. Those are immensely impressive numbers to say the least, so it’s no wonder we’re seeing Facebook shell out so much money to acquire the company. Currently, WhatsApp is run by a relatively small team of 50 people, but once the merger is a done deal, we can probably expect that team to grow by at least a fair amount.

Of course, there’s always some hesitation from existing users when a big company comes in and takes control of a beloved service, but WhatsApp co-founder and CEO Jan Koum promised today that nothing will change once Facebook is in charge. He says WhatsApp will retain autonomy after the merger, and reassured that further monetizing the app with advertisements isn’t going to happen. Koum and the rest of the WhatsApp team have been uncompromising in their refusal to run ads, instead monetizing the service by charging users a $0.99 yearly fee. That kind of strategy seems at odds with Facebook’s method, which includes placing ads next to content that’s free to use, so we’re sure some users are pleased to have Koum’s reassurance here.

Make no mistake, this is a major purchase for Facebook. WhatsApp users send 1 billion pictures through the service each day, so once the deal is complete, Facebook will be expanding its mobile presence by a significant amount. Koum is destined for big things too, as this merger will see him join Facebook’s board of directors. More information on this buyout will definitely be coming soon, so keep it here at Android Headlines. In the meantime, head down to the comments section to tell us what you think of Facebook’s plan to buy WhatsApp!