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Facebook spent a lavish amount of money acquiring WhatsApp, a text messaging app, for a total of $19 billion, $4 of...
Facebook spent a lavish amount of money acquiring WhatsApp, a text messaging app, for a total of $19 billion, $4 of which in cash, and $12 in stock. Another $3 billion in stock is a reserved amount to be awarded to WhatsApp's founders and employees in the next 4 years. This huge tech deal brings Facebook on its way to become the fastest connecting service by getting into the mobile messaging market.
WhatsApp is a text-messaging service, with more than 320 million daily active users and more than 450 million monthly active users, worldwide. WhatsApp is free to download, but after the first year you need to pay an annual fee of $0.99 if you want to keep using it. The service lets you send text messages to any of your contacts, for free, thus allowing millions of people worldwide to stay connected with friends and family.
Jan Koum, WhatsApp’s co-founder and CEO, says that the partnership would change nothing for users. On the service, Koum claims that WhatsApp will continue not to use ads or gimmicks, just as it didn't before. Koum will join Facebook's board of directors and become an executive, once the deal closes.
Facebook's CEO, Mark Zuckerberg, says that WhatsApp's partnership with Facebook will connect one billion people. Mark is thrilled to have Koum on board, “I've known Jan for a long time and I'm excited to partner with him and his team to make the world more open and connected."
Zuckerberg's tactics to switch from social networking to mobile messaging is a smart move in the new era of communication, according to Ben Bajarin, a renown industry analyst.
This remarkable purchase is Facebook's most expensive acquisition so far, and one of the biggest in the past ten years. It's quite a deal, isn't it?