馃攳
Why Facebook Acquired WhatsApp for $19 BILLION - YouTube
Channel: The Crypto Illuminati
[0]
why facebook acquired whatsapp for 19
[3]
billion dollars
[4]
in february of 2014 facebook announced
[7]
its plans to acquire the messaging
[9]
company whatsapp for 19 billion dollars
[12]
making it the second largest acquisition
[15]
in history
[16]
whatsapp is the most popular messaging
[18]
app ever
[19]
with over 2 billion users across the
[21]
world
[22]
in 2018 there were roughly 65 billion
[26]
messages
[26]
sent on whatsapp per day which is little
[29]
more than 45 million messages
[31]
every minute a key ingredient to
[34]
whatsapp's success
[35]
was timing whatsapp was founded in 2009
[38]
very soon after apple and google
[40]
launched their app stores
[42]
messaging is a basic block of the
[44]
internet and whatsapp was around to
[46]
fulfill this need
[47]
right at the start of the mobile app age
[51]
today we are able to take free messaging
[53]
as a given but in 2009
[55]
mobile messaging was mostly done through
[58]
sms which is
[59]
much clunkier and not free whatsapp made
[62]
the process for joining mostly
[64]
frictionless
[65]
all you need is a basic smartphone and
[67]
an internet connection
[68]
to message someone from anywhere in the
[70]
world all you need is their phone number
[72]
no email address username qr code or
[75]
friendship needed
[76]
in a lot of countries such as india this
[79]
has allowed whatsapp to dominate
[83]
facebook doesn't show ads on whatsapp
[85]
nor do they charge users a subscription
[87]
fee
[88]
in fact whatsapp hardly makes any money
[90]
for facebook at all
[92]
so why in the world did facebook pay so
[94]
much for whatsapp
[96]
facebook has around 2.5 billion monthly
[99]
active users
[101]
a lot of people who don't have facebook
[103]
live in developing parts of the world
[105]
where the internet is a luxury that not
[107]
everyone has access to
[109]
in india for example there are millions
[111]
of people who use whatsapp every day
[113]
but have no access to the rest of the
[115]
internet because phone providers offer
[117]
very cheap
[118]
whatsapp only data plans a user base
[121]
like this
[122]
is a great resource of untapped
[124]
potential for facebook to acquire
[126]
its nbu or next billion users
[130]
facebook makes its money through
[132]
targeted ads
[133]
more users equals more money and more
[136]
clicks
[136]
equals more money
[140]
there are no ads on whatsapp for now but
[143]
there are billions of active users
[145]
and lots of data although facebook does
[148]
not currently use whatsapp data to
[150]
improve their ads on other platforms
[152]
it's certainly an option they have if
[154]
they choose to exercise it
[156]
the user data from billions of messages
[158]
sent every day
[159]
means that facebook can improve their
[160]
targeting which would lead to more
[162]
clicks
[163]
and in turn more money when you operate
[165]
on the scale that facebook does
[167]
even incremental improvements in ad
[169]
targeting can mean billions of
[171]
additional dollars in revenue
[175]
but there's also another strategic
[177]
reason for this acquisition
[179]
although they wouldn't use the word
[181]
facebook is effectively a monopolist in
[183]
the social network space
[185]
in any monopoly a high barrier to entry
[188]
is important to protect the monopolist's
[190]
position
[191]
social networks intrinsically have a
[193]
higher barrier to entry
[194]
because of the network effect which
[197]
gives a product or service more value
[199]
when more people are using it social
[201]
networks are not valuable if there are
[203]
not enough people
[204]
on it which makes them very hard to
[206]
start
[207]
however with whatsapp's active user
[209]
numbers it no longer had this barrier to
[212]
entry
[212]
whatsapp was already a direct competitor
[214]
to the messenger app
[216]
but as a fast-growing company with
[218]
billions of active users
[219]
it also posed a potential future threat
[222]
to facebook
[222]
making it a formidable competitor for
[225]
example
[226]
if whatsapp kept expanding on their
[228]
offerings as
[229]
is natural for a growing software
[230]
company one of the next logical moves
[233]
might be to add a story feature or make
[236]
a new tab for whatsapp posts and
[238]
statuses
[239]
all of which threaten to steal content
[241]
and engagement from facebook and
[243]
instagram
[244]
by acquiring whatsapp facebook
[246]
effectively secured its seat
[248]
on the social networking throne if you
[251]
enjoyed this video please smash the like
[253]
and subscribe buttons
[254]
and we'll be back with more content soon
Most Recent Videos:
You can go back to the homepage right here: Homepage