Head of Technology Matt Warman explains why Facebook spent $19bn on mobile messaging start up WhatsApp
Facebook is set to buy fast-growing mobile-messaging start-up WhatsApp for $19 billion (£11bn) in cash and stock in a landmark deal that places the world's largest social network closer to the heart of mobile communications and may bring younger users into the fold.
Founded by a Ukrainian immigrant who dropped out of college, Jan Koum, and a Stanford alumnus, Brian Acton, WhatsApp is a Silicon Valley start-up fairy tale, rocketing to 450 million users in five years and adding another million daily.
The WhatsApp deal is worth more than Facebook raised in its own IPO and underscores the social network's determination to win the market for messaging.
"Facebook has spent its next 19 years of profit on this, if it keeps going at the rate its going at the moment on this, on buying this one company," said Telegraph's Head of Technology, Matt Warman.
The move is mostly a denfesive one for the company, he added. "Facebook, I think, is going to start to become a company like Google, like Intel was which is acquiring more businesses in a bid to preserve its position and in a bid to make no one else is coming up with the ideas they may pose a threat to it."
Source : The Telegraph
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