Whatsapp bought for $19 billion Whatsapp

[Santy]

LOL a tiny 'free' mobile app that weighs about 10 mb is worth more than Sony and Panasonic.
Ridiculous what technology and innovation can do.
Of course it's valuation is not that much is a different issue but this acquisition is one of the most unbelievable. That money is half of India's annual defence budget... ! Insane.

 

[Santy]

Why can't I edit the subject, there's a typo...! :sad:

 

[keith_correa]

Does valuation depend on size occupied on disk? In 1997 or thereabouts, Sabeer Bhatia's Hotmail weighed next to nothing on users disks but still went for ~$400 mil. Ha! What is value (perceived?) to "them" might not be value to "us" and vice versa.

And what probably makes it more insane is that the valuation of WhatsApp exceeds the defence budget of Tonga!

 

[Santy]

An interesting perspective of this acquisition :
Why Selling WhatsApp To Facebook Would Be The Biggest Mistake Of Jan Koum's And Brian Acton's Lives - Forbes

 

[prem]

Hi Santy

As a business person you look at it differently.

Whatsapp has 450 million registered users. At USD 19 billion, thats USD 42 per user. Its not a bad deal considering the amount of info you have on these users.

 

[arhantd]

Hi Santy

As a business person you look at it differently.

Whatsapp has 450 million registered users. At USD 19 billion, thats USD 42 per user. Its not a bad deal considering the amount of info you have on these users.

+1
Brilliantly put, the deal does seem worth it in $42/user terms!
But what amazed me was that just a handful of people with an infant company could create so much value!

Some one quipped, even the janitor who had some shares in the company is going to make upwards of 100 cr.
Dont know that for a fact but the whole thing is just unbelievable!!

 

[Hiten]

Whatsapp advantage beside huge customer base is anyone can use it. No need for computer or internet, so it will only grow. I regularly use it to send design proofs to my clients. Very handy.
Regards.

 

[Santy]

Yes the amazement was not about the justification of this acquisition (obviously there will be), but how its worth as perceived by FB exceeds that of several big businesses like Sony, nvidia or Panasonic which have huge and complicated business operations, network, stores, employees etc. doing what they do for several decades.

Going by traditional valuation it seems whatsapp is worth about usd 1 billion (the annual usage charges after one year is just USD 1 so even if all users buy it is not worth to buy one account for USD 42). However FB looked at its long term potentials. Whatsapp has one thing that FB dosent, our mobile no. They can track a lot more of the users and their preferences. So basically the excess money paid is for our privacy. That is what FB considered worth apart from possible growth more than what the app saw so far. Anything can happen if its a tech bubble. FWIW, whatsapp added 400 million users 4 times faster than Facebook. The growth "rate" too has a value.

 

[zervinb]

Whatsapp advantage beside huge customer base is anyone can use it. No need for computer or internet, so it will only grow.

Whatsapp does require an internet connection to send messages, and obviously a smartphone.

 

[Hiten]

You are right zervin. I meant portability and easy access.
Regards

 

[anubisX]

Or may be someone else is funding Facebook to get hold of Whatsapp so they can keep track on users with their mobile numbers. It's better than IP tracking, right ? Anyone can spoof IP now with different VPN softwares and what not. But when it comes to phone, not many can clone a number. So, that's easy tracking. Privacy is the major concern for us

 

[keith_correa]

<snip>Whatsapp has 450 million registered users. At USD 19 billion, thats USD 42 per user. Its not a bad deal considering the amount of info you have on these users.

AFAIK, they DO NOT have much at all. But maybe I'm missing something here and there is more to it than it seems. Can you elaborate more?

 

[keith_correa]

<snip>Whatsapp has one thing that FB dosent, our mobile no. They can track a lot more of the users and their preferences. So basically the excess money paid is for our privacy.<snip>

Can you please elaborate more on the tracking using our # and how it will be tracked? Honestly, the way WhatsApp is currently, I really do not understand the value in it apart from:
The already existing revenue that they accrue by way of subscription
Their Low employee base

What else?

 

[Santy]

If you are aware how Google intrudes in your privacy, you will get an idea. In digital marketing they call it as targeted ads. And targeted ads fetch much more revenue than generic burning of impressions. If I search something on flipkart but don't buy, those products used to follow me (remarketing) through Google network sites. ( It works on cookies if I am not wrong). Have you not seen single line relevant ads on gmail? That is possible because google reads your emails. Similarly, whatever you type in whastsapp is captured. They will know about your interests and characteristics apart from your location. Then they can fire relevant ads on your app or may be on your FB page if you had linked your mobile no.

Ps: typing from tab

 

[keith_correa]

If you are aware how Google intrudes in your privacy, you will get an idea. In digital marketing they call it as targeted ads. And targeted ads fetch much more revenue than generic burning of impressions. If I search something on flipkart but don't buy, those products used to follow me (remarketing) through Google network sites. ( It works on cookies if I am not wrong). Have you not seen single line relevant ads on gmail? That is possible because google reads your emails. Similarly, whatever you type in whastsapp is captured. They will know about your interests and characteristics apart from your location. Then they can fire relevant ads on your app or may be on your FB page if you had linked your mobile no.

Ps: typing from tab

Oh, I know about the targeted ads that google does and about their scanning of mails supposedly for spam. And now i know how this may be extended to WhatsApp messages too. I'm more interested in the relevance of the telephone # while tracking and for what possible purposes. I'm sure there are things that can be done using the # but at this point, i cannot fathom what/why. All, please chip in with your thoughts. I think if you are accessing FB using their app from your device that is used for calling, they already have your #.

 

[prem]

Hi Keith

What's there to elaborate. It has 450 million users according to the Economist and Bloomberg. It's expected to touch 1 billion in a few years.

 

[keith_correa]

Hi Keith

What's there to elaborate. It has 450 million users according to the Economist and Bloomberg. It's expected to touch 1 billion in a few years.

<<< So? >>>

 

[Nibbio]

Personally i think that even without whatsapp, facebook itself has all necessary means to intrude our privacy. For example, you leave your mobile no. as part of your account information, moreover when you use the mobile version of facebook, you grant access to your destination, which isn't something only facebook gathers. It's also part of the privacy policy viber uses, and twitter and google.

So buying whatsapp is just one more way for facebook to have access to our personal info.