FP StaffJul 27, 2022 16:23:53 IST
Meta, back in 2014 when it was known as Facebook, had acquired WhatsApp in 2014 for a cool $19 billion. Back then, it was one of the most expensive tech deals. It was also said to be one of Mark Zuckerberg’s most ambitious deals.
However, Zuckerberg’s deal is not working out as he had hoped. The app still has not been able to generate a decent return for investors who had bet big on the world’s most popular messaging app. It’s been over half a decade and Meta is yet to make a viable profit off of WhatsApp.
WhatsApp was launched in 2009 by Brian Actom and Jan Koum, who were former Yahoo employees. When Koum purchased a new iPhone in 2009, he stumbled across Apple’s App Store and the duo saw a million possibilities.
The idea of sharing dynamic information like an SMS but over the internet and displaying the special message for everyone or their “status” for every person on the phone’s address book spawned what is now the most downloaded and used IM app across platforms.
By 2013, the app had over 400 million unique users. However many users migrated to Telegram and Line soon after Meta acquired WhatsApp.
WhatsApp’s major competitor, Telegram reported 8 million new users as opposed to 2 million unique subs on the Line app in 2014. However with 600 million users now, WhatsApp was the most popular messaging app on Earth and it still is. WhatsApp, as of now, brags that it has 2 billion users now.
Despite this, the business hasn’t been able to generate much profit for Meta, or rather, Meta hasn’t been able to monetise WhatsApp without hurting its user base.
With the quarterly report due on July 27, it’s gonna be a tough time for Mark Zuckerberg to face the ire of investors, even as competing apps like WeChat are doing well with lesser subscribers.
This may mean that given Zuckerberg and Meta’s fiduciary responsibilities towards Meta’s shareholders, they may eventually have to sell off WhatsApp or start charging some sort of fees for premium users.