Facebook Acquires WhatsApp for Its Huge User Base

Posted on February 21, 2014

Facebook has acquired WhatsApp for $19 billion. CNN notes that is over 19 what it spent for Instagram. The deal was $4 billion in cash and about $12 billion in stock. Even though it is mostly a stock deal it does seem like Facebook paid more than necessary.

Facebook CEO Mark Zuckerberg said in a statement, "WhatsApp is on a path to connect 1 billion people. The services that reach that milestone are all incredibly valuable. I've known Jan for a long time and I'm excited to partner with him and his team to make the world more open and connected."

WhatsApp is a mobile messaging service a large user base of 450 million active users that is growing rapidly. A lot of times these acquisitions are as much about the users as the technology.

The Telegraph's Head of Technology Matt Warman does a great job of explaining WhatsApp and the acquisition in this video. Warman calls it partially a defensive move by Facebook. He sees BBM and Snapchat as two mobile services that could get purchased next.