The deal includes $4 billion in
cash and approximately $12
billion worth of Facebook
shares. There’s also the option
for another $3 billion in
restricted stock for WhatsApp founders and employees that
will vest over four years after
the deal closes.
Facebook said Whatsapp will
continue as a separate
offering, much as Instagram has remained independent since it
was acquired by Facebook in
April 2012. The company will
stay in Mountain View, while
Jan Koum, WhatsApp co-
founder and CEO, will join Facebook’s board.
“WhatsApp’s extremely high
user engagement and rapid
growth are driven by the
simple, powerful and
instantaneous messaging capabilities we provide. We’re
excited and honored to
partner with Mark and
Facebook as we continue to
bring our product to more
people around the world,” Koum said in a statement.
“WhatsApp is on a path to
connect 1 billion people. The
services that reach that
milestone are all incredibly
valuable,” said Mark Zuckerberg, Facebook founder
and CEO. “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.” In a blog post, Whatsapp said
that “nothing” will change for
customers.
“WhatsApp will remain
autonomous and operate
independently. You can continue to enjoy the service for a
nominal fee. You can continue
to use WhatsApp no matter
where in the world you are, or
what smartphone you’re
using,” the company continued. “And you can still count on
absolutely no ads interrupting
your communication. 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.”
The acquisition comes two
months after WhatsApp announced that it had 400
million monthly active users, a
milestone it said no other
mobile messaging service had
reached.
WhatsApp is available on Android, iOS, BlackBerry, Nokia
S40, Symbian, and Windows
Phone (slideshow above). The
app, which is free for the first
year and $0.99 per year
thereafter, allows users to exchange messages without
eating into monthly text
allotments, like BBM or
iMessage.
The $16 billion figure,
meanwhile, is a nice chunk of change, considering that the
Instagram deal was worth a
reported $1 billion. Recently,
meanwhile, there were reports
that Snapchat rejected a $3
billion offer from Facebook but given messaging app’s recent
privacy snafus, it might now be
wishing that it had accepted
the social networking site’s
deal.
UPDATE: During a conference call with analysts, Zuckerberg said
WhatsApp will help Facebook as
it continues to transition to a
more mobile-focused company.
It’s an “extremely high-quality
product” with strong engagement, he said, and does
not get as much attention in
the U.S. as it deserves.
At this point, WhatsApp is the
only widely used app that has
more engagement than Facebook itself, Zuckerberg
said. It’s at 450 million users
and signing up 1 million people
per day. It’s on its way to 1
billion users, and any Internet
service that tops that milestone is extremely valuable,
according to Zuckerberg, and
going forward, WhatsApp will
help Facebook toward its goal
of connecting the world.
