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Facebook buys WhatsApp for $19 billion: What does it mean?


Facebook has bought WhatsApp, the news has been rounding across the globe now-a-days and is being considered as the fusion of the year.

In a transaction, the biggest social network, of the all-time, and the SMS killer WhatsApp comes altogether, which will generate a hike of inestimable value in the market.

The deal was closed on February 19 for a total value of about $19 billion, in which $12 billion of Facebook shares and $4 billion in-cash and an additional $3 billion in restricted stock units to be paid to the messaging app’s founders, Jan Koum, Brian Acton and its employees.

In Mark Zuckerberg’s words, “It [WhatsApp] is on its way to connecting one billion people.” In response, Jan Koum, co-founder and CEO of WhatsApp said that he would be happy to continue to operate now as a partner of Facebook since both communities follow a common path. Now Koum, with immediate action, has become the part of the board of directors of Facebook.

What did cost $19 billon to Facebook?

Currently, Facebook has almost 1.23 billion active users as of January 2014; and after the deal, it will be adding the following figures to its progress graph:

  • 450 million active users/month;
  • 320 million active users/day;
  • 1 million new registered users/day;
  • 50 billion of exchanged messages/day;
  • 600 million photos uploaded/day;
  • 200 million voice messages/day;
  • 100 million videos sent/day;
  • And the volume of messages sent is now equal to the entire global market of SMS.

Does it affect existing WhatsApp users?

Although nothing will be changed for existing WhatsApp users immediately, but the results of the acquisition will be seen later in time, and indeed positive ones.

“WhatsApp will remain autonomous and operate independently. You can continue to enjoy the service for a nominal fee,” Koum made clear on its official blog in context of operations of the group. “You can continue to enjoy the service for a nominal fee.”

Moreover, WhatsApp still owns its words and won’t inject adverts, and they will continue the app for all available mobile platforms including Android, iOS, Windows Phone, BlackBerry, Nokia’s Series 40 and Asha platform.

“There would have been no partnership between our two companies if we had to compromise on the core principles that will always define our company, our vision and our product.” He added.

Why did Facebook buy WhatsApp?

It’s all about the progressive graph of WhatsApp. In fact, there’s no online service, which has an increase of this magnitude. In all way, the messaging app is better than Skype, widely better than Twitter, Gmail and even though leaves behind Facebook.


WhatsApp has about 450 million active users monthly, in which 70% of active users per month have been using the service daily. And indeed everything revolves around the so-called “big data”. Facebook now own a community of 450 million users, and it will a great help to achieve a clear aspects of the relationship between social profiles.

Furthermore, there’s an SIM card behind every WhatsApp user, which defines its uniqueness and confirms the real identities. Consequently, the team of Joe Koum never introduced a PC version of the app.

Google offered $10 billion or more, but couldn’t make it.

The social network in blue wasn’t the first to have an interest in WhatsApp. Lately, Google also tried to own the makers of messaging app and its brand, offering 10 billion dollars, but the deal couldn’t be negotiated, reported Fortune on Thursday.

At the same time, TheInformion claimed that the CEO of Google, Larry Page met with Jan Koum last week, in a desperate bid, to jolt the deal made by Facebook.

According to reports, Google was ready to pay more than $19 billion for WhatsApp. Meanwhile, an anonymous source quoted Page saying, “Stay independent as you’ve always planned. You’re a big threat to Facebook. And joining Facebook would have a major impact on how things play out for years to come,” but Koum found Facebook is the right place to grow independently as both communities share a common vision of connecting people.

How did Wall Street react after the deal?

The stock market seemed to reward the choice made by Facebook. After few hours, Facebook shares (NASDAQ:FB) dropped just 1.7 percent so as to materialize the reaction, roughly balanced instead of outlay of great impact.

Consequently, within 24 hours of WhatsApp acquisition, BlackBerry Ltd. (NASDAQ:BBRY) grew more than 5 percent due to the assessment of the company. However, the value of BlackBerry still remains below the WhatsApp. In fact, the Canadian company has value of only $3.2 billion that’s six time lesser than what Facebook paid for WhatsApp.

Ultimately, Facebook now owns WhatsApp, and we will see “some amazing work to connect almost half a billion people!”

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