The Price of Relevance


The Price of Relevance

Last week, Facebook sent shock waves to the tech world when it announced that it acquired WhatsApp, a fast-growing five-year-old social messaging app company, for a jaw-dropping $19 billion in cash and stock. The purchase is Facebook’s biggest acquisition ever, dwarfing the $1 billion it paid for Instagram in 2012.

WhatsApp’s expensive price tag buys Facebook 450 million loyal users, with 1 million new users being added daily. Analysts considered the deal as Mark Zuckerberg’s attempt to protect his company’s turf as the top social networking site in the world. It’s no secret that Facebook has struggled in the field of mobile messaging and has been losing teen users in the US as millions have migrated to using social messaging apps. Clearly, the acquisition was Facebook’s way of crushing competition and the easiest route for the company to become relevant in the mobile messaging space.

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