Facebook buys Whatsapp for $19bn

By Drum Digital
20 February 2014

Facebook is betting huge on mobile with an eye-popping cash-and-stock deal worth up to $19bn for Internet Age smartphone messaging service WhatsApp.

Facebook is betting huge on mobile with an eye-popping cash-and-stock deal worth up to $19bn for Internet Age smartphone messaging service WhatsApp.

The surprise mega-deal announced on Wednesday bolsters the world's biggest social network - which has more than 1.2 billion members - with the 450-million-strong WhatsApp, which will be operated independently with its own board.

It fits with Facebook founder Mark Zuckerberg's focus on being at the centre of lifestyles in which billions of people around the world share whatever they wish over the internet using smartphones or tablets.

"Facebook works harder than any other social site to keep people coming back," said Forrester analyst Nate Elliott.

"In the past year, they've focused much of that effort on mobile - introducing Home and Paper, and upgrading both their Facebook and Messenger apps - and this is another step toward keeping people engaged no matter where they are."

Facebook promised that WhatsApp would remain independent and said it served a real-time communication need, while Messenger was used more in the style of e-mail between members of the social network.

WhatsApp is ideally suited to young people who increasingly prefer rapid-fire smartphone messaging to making calls or churning out e-mail. Facebook has been eager to keep the devotion of young users who set trends and carry tech habits into the future.

It is Facebook's biggest acquisition and comes less than two years after the California-based company raised $16bn in the richest tech sector public stock offering.

Zuckerberg said that WhatsApp - a cross-platform mobile app that allows users to exchange messages without having to pay telecom charges - was worth the steep price because its blistering growth around the globe has it on a clear path to hit a billion users and beyond.

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