Facebook Inc.’s purchase of mobile messaging service Whatsapp Inc. for $19 billion in stock and cash is by far the company’s largest acquisition and bigger than any which Microsoft, Google or Apple had ever done.
WhatsApp being the leader among Smartphone based messaging apps which is sweeping all across Asia, North America and Europe is known to appeal to many users especially teens who tend to avoid the mainstream social networks.
Facebook favors WhatsApp for its audience of young adults as well as teenagers who are using the service to get engaged in online conversation outside Facebook that has evolved into a mainstream hangout by parents, bosses at work and grandparents as well.
WhatsApp messaging service for Smartphone enables users to chat with their phone contacts both one on one as well as in groups. Moreover, the service enables people to send texts, photos, video and voice recordings across the internet and also permits users to communicate with people overseas at no charge for costly international text and phone calls.
Founder and Employees granted Restricted Stock
The world’s biggest social networking company will be paying $12 billion in Facebook stock and $4 billion in cash for WhatApps, it was reported. In addition to it, the app’s founder and employees which are around 55 in all will also be granted restricted stock worth $3 billion which will vest four years later after the closure of the deal. The deal is expected to close somewhere later this year.
WhatsApp, Separate Service for Facebook
Gartner analyst Brian Blau comments saying that `this is a bet on the future for Facebook and they are aware that they have to expand their business line. WhatsApp is in the business of collecting people’s conversation and hence Facebook is going to get some great data’. Facebook, it has been reported saying, that it will keep WhatsApp as a separate service similar to Instagram which it bought for around $715.3 million two years ago and WhatsApp has more than 450 million monthly active users while twitter in comparison had 241 million users by the end of 2013.
“According to CEO, Mark Zucherberg, WhatsApp seems to be on the path to reach a billion users”