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Facebook's New Message to WhatsApp: Make Money (wsj.com)
Deepa Seetharaman, writing for WSJ: Four years after Facebook bought WhatsApp for $22 billion, it is formally starting the messaging app on a new mission: bringing in revenue. WhatsApp on Wednesday detailed plans to sell advertisements and charge big companies that want to reach their customers through its service [Editor's note: the link may be paywalled: alternative source], launching its first major revenue streams as growth at Facebook's main app is starting to decelerate. The measures are aimed at connecting businesses with WhatsApp's user base of roughly 1.5 billion accounts, WhatsApp executives said.
The announcements follow disagreements between Facebook leaders and WhatsApp's co-founders, Jan Koum and Brian Acton, over how to monetize the popular, free service. Mr. Koum and Mr. Acton resisted efforts to put ads in WhatsApp, and over the past year both men have decided to leave Facebook and the messaging app they started in 2009 -- a breakup that was the subject of a Page One article in The Wall Street Journal in June. [...] Next year, WhatsApp plans to show ads in its Status feature, company officials told the Journal. Status allows users to post montages of text, photos and video that appear for 24 hours -- similar to an Instagram tool called Stories. About 450 million people use WhatsApp Status, compared with about 400 million who use Instagram Stories, which already shows ads.
The announcements follow disagreements between Facebook leaders and WhatsApp's co-founders, Jan Koum and Brian Acton, over how to monetize the popular, free service. Mr. Koum and Mr. Acton resisted efforts to put ads in WhatsApp, and over the past year both men have decided to leave Facebook and the messaging app they started in 2009 -- a breakup that was the subject of a Page One article in The Wall Street Journal in June. [...] Next year, WhatsApp plans to show ads in its Status feature, company officials told the Journal. Status allows users to post montages of text, photos and video that appear for 24 hours -- similar to an Instagram tool called Stories. About 450 million people use WhatsApp Status, compared with about 400 million who use Instagram Stories, which already shows ads.
Yes they are clearly at stage 2.
Step 1: Spend bazillions on a company that has not made profit.
Step 2: Demand magic profit.
Step 3: ???
Step 4: Divestment, the idea of profiting to the tune of the value of these unicorns is utterly absurd.
Before the FB acquisition, WhatsApp used to have a subscription model: $1/year and the first year was free.
Cue the 'we can't all afford $1 a year' complaints.
When I first signed up for WhatsApp, they had a great way of making money -- 1 year free, subsequent years $1/year. I was so excited when I saw that -- FINALLY, a platform that will just let me pay to use it, rather than trying to spam me with junk and sell my information!
When FB bought the company and cancelled the yearly fee, I knew it was only a matter of time. I'm mostly surprised it took them so long.
TCP: Why the Internet is full of SYN.
The people using WhatsApp are doing so in part with the knowledge that there doesn't appear to be any snooping going on. Adding ads to the service would pretty much destroy that reason for using it
Are you saying there can't be ads without snooping?
No sig today...
Are you saying there can't be ads without snooping?
HAHAHAHAHAHA.
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You don't need to spy on your users to show them ads. It will only be non-targeted ads.
#DeleteFacebook
Is it really so ubiquitous? I never used it and all my friends are on either iPhone, iPad or Mac - except for one who's using Windows and I contact him via Google Talk (at least that's what iMessage calls it in the input window).
If all your contacts are on Whatsapp, then yes you're boned. Just like I'm boned if I ever leave Apple.
#DeleteFacebook
I have a similar story. I got a hotmail address way before Microsoft bought them but the day they did, I stopped using it and got myself a gmail address instead. ... at the time, Google was a lesser evil than Microsoft. Today, I'm not just sure which one is more evil than the other.
#DeleteFacebook
They donated $50M of that money to competitor Signal.
Not to sling mud on Telegram, but there was a story here saying the devs had to hand over their encryption keys: https://it.slashdot.org/story/... In the comments, a strong case for using Signal as a secure messenger can be found.
Ypu're probably from the US, the only country where telco's introduced affordable unlimited sms plans in time to prevent WhatsApp and others from taking over the market. When WA came, sms costed here $0,10 per message and MMS $0,50. Now, SMS is cheaper but hardly used and MMS is phased out because noone uses it anymore. WA is abundant.
Buying WhatsApp was a defensive play by FB so that someone else could not easily muscle in on their social media turf and prick their frothy valuation.
Similarly, Google arguably overpaid for YouTube and is ballpark only breaking even today. But the strategic value of having access to the search/usage data from the most popular video gateway is too big to let a competitor own.
Half my friends are on Android, half are on iOS. WhatsApp lets me chat with them easily across either platform, including group chats and (free) global voice conversations. SMS / MMS is a pain in that regard. Sending images and videos is also easy. My only complaint is they don't have a PC client - The fact that you can seamlessly move from PC to mobile is one of the things I really like about Facebook messenger.
I don't think so. Facebook gets a bit of lockin that way because it's a passive medium. You post something, your friends wander by to look at it. Same with instagram. No friends, less likes.
WhatsApp is active. I send you a message. You send me a message. Neither of us is fishing for likes, so the size of our audience doesn't matter. It's a low bar for you to install Telegram if WhatsApp starts pushing ads.
I think maybe that's something the marketers don't understand. "Social media" isn't special, it's just the same old old communication business where the characteristics of the medium are critical.
You'd think they would have learned from all the IM systems that went before. We all thought ICQ had a lock, until everyone stopped using it.
Canada, where I have no idea how cellphone plans work because I've never had one in my life. Way too expensive for the services offered. Communicating via iMessages, on the other hand, is free. I just need to find an open wifi network when I'm not home.
#DeleteFacebook
all my friends are on either iPhone, iPad or Mac - except for one who's using Windows and I contact him via Google Talk
You must not have a lot of friends, given Apple has less than 15% market share in phones and even less in PCs.
Any better idea?
Anything not based on a phone number as an identifier, which prevent most PCs/tablets without a cellular connection, from using.
A phone number can also change, and is country specific. Also never use a protocol limited to one vendor.
So really, there is no reason to use Whatsapp or iMessage.
Telegram and Viber. Two almost as ubiquitous IM clients that would easily replace whatsapp if it ever goes pay to use, or gets annoying with ads.
And then, there's of course WeChat, which is functionally better than WhatsApp already in many ways but has other problems.
I'll counter with my plan:
1. Create genius idea
2. Get bought by facebook
3. Swim in my money
Also, giving back the money is hardly an option. I doubt very much that there was a line in the contract allowing for backsies.
Its not about taking whatsapp back from FB, they claim to be morally outraged while sitting in the palaces that selling out bought. Give the money to charities, then they can complain.
The problem here is that FB was foolish enough to buy a service like WhatsApp without having a viable strategy for making money. The people using WhatsApp are doing so in part with the knowledge that there doesn't appear to be any snooping going on. Adding ads to the service would pretty much destroy that reason for using it, at which point there's numerous other possibilities, some of which already have traction.
Its the typical silicon valley process: 1) Get Users 2) ??? 3) Profit. I guess in Facebooks defense we all thought they were insane for buying Instagram for $1-billion.
All my friends are in Canada.
#DeleteFacebook
I guess I was using something else in the meantime and forgot about it.
#DeleteFacebook
Even so, it would be surprising if Apple had more than, say, 80% market share there. Having only 1 friend within the remaining 20% pretty much means you must be living under a rock. Of course if Apple only has 30 or 15% of the market in Canada, it is even worse.
Half my friends are on Android, half are on iOS. WhatsApp lets me chat with them easily across either platform, including group chats and (free) global voice conversations. SMS / MMS is a pain in that regard. Sending images and videos is also easy. My only complaint is they don't have a PC client - The fact that you can seamlessly move from PC to mobile is one of the things I really like about Facebook messenger.
There's a web client that proxies through your phone. web.whatsapp.com.
The Daddy casts sleep on the Baby. The Baby resists!
Create a WhatsApp Social Network where any message you post can be public.
You still need a phone. Fail.
#DeleteFacebook
Signal is a more secure, similarly phone#-based replacement. Telegram is an easier and more featureful one, and nicely has open-source clients and protocol albeit questionable server infrastructure and crypto. Riot.im on Matrix is philosophically the best (entirely Free Software, and decentralized and federated so it isn't beholden to one entity running a central server but everyone even running their own server can talk to everyone else).
I remember sigs. Oh, a simpler time!
There's a web client that proxies through your phone. web.whatsapp.com
Thanks. Still not perfect, but a considerable improvement.
The instragram like story thing?
LOL Go for it, ruin it, I couldn't care less. I don't know a single person who uses that!
I know. Not my favorite solution, either. But if I'm at home on my computer, it's easier on the other party than my usual typo-ridden chats.
The Daddy casts sleep on the Baby. The Baby resists!
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There IS now a native Windows PC client. You can download it from Whatsapp's official site