Social media giant Facebook made viral headlines across the web, including on its own platform, when the company announced that it would be acquiring mobile messaging service WhatsApp for $19 billion on Wednesday. The acquisition itself was not surprising, as Facebook has been known to pursue any services that rival or surpass its own Messenger app. The exorbitant price Facebook paid for WhatsApp is what seemed the most outrageous.
Although WhatsApp is a popular, widely used service, its effect on popular culture is nowhere near that of Facebook. Still, the app’s ability to send messages, photos and videos via Wifi or data has made it successful in the international market, allowing individuals and groups to communicate for free across country lines. Facebook CEO Mark Zuckerberg confirmed that the acquisition had global implications.
WhatsApp “doesn’t get as much attention in the U.S. as it deserves because its community started off growing in Europe, India and Latin America. But WhatsApp is a very important and valuable worldwide communication network. In fact, WhatsApp is the only widely used app we’ve ever seen that has more engagement and a higher percent of people using it daily than Facebook itself,” Zuckerberg said.
According to The Blaze, Facebook is paying around $42 per WhatsApp user during the acquisition, as the service has over 450 million monthly active users. Reports vary about how long it will likely take Facebook to regain that sum, but it’s undeniable that the company has purchased a service that could have risen to become one of its primary competitors. The ability to squash a competitor’s growth may be victory enough, especially regarding Zuckerberg’s failure to buy messaging service Snapchat even after offering the company's young founders $3 billion. Access to WhatsApp's surplus of data regarding international consumers is also highly valuable for Facebook's marketing team.
Despite the recent acquisition, Facebook maintains that not much will change regarding WhatsApp. The company is going to keep its original office space, and the app is to remain separate from Facebook’s main app. WhatsApp has an office of 55 employees, all of whom are to be granted company stock worth a total of $3 billion.
Apple’s merger and acquisitions chief Adrian Perica and Tesla Motor’s chief executive Elon Musk met last year, suggesting that the iPhone maker may expand its business to electric cars.
Considering Apple has announced plans to better integrate iOS into car dashboard screens and has partnered with Ferrari, it seems likely that the Silicon Valley giant would be interested in Tesla.
The meeting was reported Sunday by The San Francisco Chronicle, which cited an anonymous source. The paper also noted that Apple is interested in medical devices, specifically those that can predict heart attacks.
Apple’s interest in electric cars and medical devices signal that the company wants to expand and take risks beyond the iPad and iPhone, as Wall Street analysts have speculated in the past.
Adnaan Ahmad, an investment bank analyst in Germany, wrote an open letter to Apple CEO Tim Cook in October suggesting that Apple buy Tesla. He argued that the electric car industry could provide long-term revenue growth unlike smartphones and tablets.
“I know this is radical and potentially 'transformative',” Ahmad wrote, “but this would radically alter Apple's growth profile.”
Neither Tesla nor Apple have commented on the alleged merger.