Facebook Announces Plans to Buy Whats App

Feb 20, 2014

In a February 19 blog post, Mark Zuckerberg announced that Facebook intends to buy Whats App. For a  total of $16 billion in cash and stock (yes...billion). There's another $3 billion in stock for Whats App employees but that will vest over four years. Whats App is a cross-platform messaging system that, according to the post,  has over 450 million people using the service each month with 70% of them active on a given day.

The post gives this reasoning for the purchase: "The acquisition supports Facebook and WhatsApp's shared mission to bring more connectivity and utility to the world by delivering core internet services efficiently and affordably. The combination will help accelerate growth and user engagement across both companies."

But pundits think Facebook might be more than a little scared. Over at Gigaom, Om Malik writes, "It keeps WhatsApp out of the hands of Google and most importantly takes out an aggressive competitor for "attention" from the market." Over at The Verge, writers say, "The mobile-messaging service could help Facebook generate more growth from younger users that are slipping away."

Zuckerberg says that Whats App will remain mostly independent of Facebook, in much the same way that Instagram has.

(facebook.com, whatsapp.com