Here's something to think about when you go overdrawn on your current account yet again this month: Mark Zuckerberg has just paid 19 billion dollars for WhatsApp, the messaging app that's totally overtaken texts (so 2010). That's almost £14 billion, just FYI.
Zuck's multi-billion-dollar spending spree (he buys apps in the way we do Chicken Cottage – recklessly and with wilful abandon) has caused shockwaves through the tech industry. But it kind of makes sense.
In recent years WhatsApp has become the most popular messenger app in a massive number of important markets globally, except in the US where Facebook Messenger is still more popular. Also, in the US, many phone plans include unlimited domestic text messaging so you can text as much as you like without worrying about your phone bill.
However, if you look at say, the UK, only 15% of people communicate via Facebook Messenger, while 49% use WhatsApp. That number gets even higher in Latin America where almost 100% of mobile users use WhatsApp, versus around 30% using Facebook Messenger, according to New York Magazine.
In a nutshell: WhatsApp is used by 450 million people per month – and Zuckerberg wants those users. Plus, WhatsApp isn’t limited to people with a Facebook profile.
Zuckerberg can now use a combo of WhatsApp and Facebook Messenger to 'connect everyone in the world', which has been his intention since the beginning. And that's just messaging stuff. Let's not forget Instagram, which he also owns. (Side note: has anyone read Dave Egger's The Circle? Zuckerberg's expansion is creeping us out a little in light of that book).
Here’s the question though: How does he plan to make money from WhatsApp? It’s generally free, and in some places costs only $1 per year. And forget about ads – he’s promised they won’t interrupt user communication. Apparently, the plan is to grow the userbase first, without figuring out how to monetize it.
Zuckerberg’s currently focusing very much on mobile users, hence the Instagram purchase in 2012. He tried to buy Snapchat too, but failed. Maybe he should have offered more than $3bn?
PS – the genius that is the internet has created a fun game where you can see how long it would take you to earn what WhatsApp was bought for here. It's so ludicrious it's funny.
This article originally appeared on The Debrief.