Carlos Fenollosa

Carlos Fenollosa

Engineer, developer, entrepreneur

Carlos Fenollosa — Blog

Thoughts on science and tips for researchers who use computers

What's so great about Whatsapp?

February 20, 2014 — Carlos Fenollosa

Facebook bought Whatsapp for $19B. There has been a lot of discussion on the net since the numbers are crazy. Even for today's standards, where startups are measured in Instagrams or Yahoo!s much like length is measured in football courts, that is a large sum.

To summarize my thoughts on the money; maybe we should start thinking about a new Web 2.0 bubble? Whether $12B in Facebook shares is actually twelve billion dollars cash is left as an exercise for the reader. Smarter people than me defend the acquisition, and I will definitely not argue against that.

So why did Facebook buy Whatsapp? TL;DR: because of what people use it for.

Notwithstanding Line's 350M users, or the hype with Telegram, Facebook went for Whatsapp for a reason, and that is because they are huge outside the US.

I don't think this is an acqui-hire as Whatsapp needs every employee and it wouldn't be a smart move to shut it down while it's #1 with this huge competition. However, Facebook can probably learn a lot from Whatsapp's engineers. Their amazing staff can scale at a ratio of 450M users per 32 engineers. That's 14M users per engineer. But again, this isn't about the people, the risk of Whatsapp being bought by Google, or just their user base.

It is most likely the fact that Whatsapp has more than 300M daily active users, and Facebook could greatly benefit from having all these people's data. Remember what Facebook, and all the other big companies on the net, are. They are advertisers. And all these people using Whatsapp is communicating outside Facebook's network.

Google wants to collect all the world's data, but Facebook wants to know everything about people. Now it will reach an additional 450M that they weren't previously controlling.

What's so special about Whatsapp users? From my experience, Whatsapp is a great mix of Instagram, Twitter, chat and Facebook. It is totally spontaneous, friendly, private, and chaotic. Non-geeks love the ability to send pics, text and audio and let messages scroll to the top. It is so comfortable to use.

But what's more interesting, users communicate intentions, meetings, events. Outside the US, nobody creates Facebook events any more; we create Whatsapp groups. Groups for parties, dinner, quick stuff that's happening and needs immediate action. We use Facebook to discuss what happened —maybe with a cool beach pic— but Whatsapp is all about the immediate future. Plans are made on Whatsapp.

And here goes my conclusion. What could be sweeter for Facebook's advertisers than knowing in advance what people are up to? It's the perfect user data. Remember, next time you create a Whatsapp group for that birthday party, restaurant ads will pop in your Facebook. And I'm not saying that it's a bad thing necessarily.

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