Facebook is buying Whatsapp for 16 billion dollars. That is a lot of money.
— Simone Bocedi (@bocedi) February 20, 2014
So "Why did Facebook buy Whatsapp?". I think there are at least three major reasons but I urge you to discuss them with me if you don't agree.
Facebook has a teenager problem and is doing everything it can to win them back
Even if they say that the "teenage problem" got a bit out of proportion, Facebook has admitted that youngsters do spend less time with the social media than in the past. They have an account (of course they do), but they don't find Facebook as sexy as other platforms. And here's the simple truth: Facebook is afraid these teenagers will get used to life without Facebook and it can't stand that. So what do they do?
Teenagers are on Instagram. Facebook bought Instagram for 1$ bn.
Teenagers are on Snapchat. Facebook offered $3 bn for Snapchat.
Teenagers are on Whatsapp. Facebook bought WhatsApp for 16$ bn.
This is not the end of it. Just the beginning.
The future is mobile
If you look at the companies they acquired during the years, they are all mobile. Facebook usage on mobile has increased so much that almost 50% of daily active users are mobile-only. Facebook knows these numbers very well, and the trends for the future are looking at mobile more than anything else.
As Cade Metz from Wired puts it:
"Increasingly, the world is moving away from sites like Facebook.com and towards a wide range of applications loaded onto mobile phones. Clearly, Facebook recognizes that its future lies with tools like WhatsApp."
Private conversations are priceless
Every day there are 50 billion conversations happening on Whatsapp versus "only" 21 billion text messages. Facebook will now own WhatsApp conversations.
Already with Instagram, Facebook introduced private messaging, to send private pictures of things we like to other
As with WhatsApp, also Instagram conversations are private, of course. What I will write now is all hypothetical, of course (*wink wink*).
But let's play out this scenario. If you give Facebook your mobile number, now they can connect it to your WhatsApp account and know a lot more about you. Next thing you'll see: targeted advertising on Facebook based on a private conversation on WhatsApp.
This is all hypothetical, remember, but I wouldn't be that surprised if it really happened.
Honorable mention: Facebook has an inferiority complex towards Google
More than a reason, it's a hinch: it's something I noticed since the early years. Facebook is partly owned by Microsoft, is a good friend of Apple but somehow they aren't that much into Google.
Messenger vs GMail
With Messenger App, Facebook aims at Gmail (or email in general). That was clear after you can create groups and send files and pictures.
Graph Search VS Google Search
With Graph Search, Facebook wishes to replace Google Search bar. And if they can't help you with your search... the results are Bing's, as are Bing's Maps those on the events on Facebook.
Facebook ads VS AdWords
Let's face it, digital advertising is split between Facebook ads and Google AdWords. When Facebook introduced lookalike audiences, they took a huge step forward into the race. We are seeing staggering results thanks to lookalike audiences. With WhatsApp, Facebook will own another 450 million phone numbers.
It won't surprise me if Facebook were to acquire a Dropbox-like company, in order to own that part of our lives too.
Overall, it was an expensive acquisition, but it does all make a lot of sense.