Facebook to buy WhatsApp for $19b

Dylan Bushell-Embling
20 Feb 2014
Daily News

Facebook has announced plans to acquire fast-growing OTT messaging player WhatsApp, in a deal worth a whopping $19 billion.

Facebook announced it will pay $4 billion in cash and $12 billion in stock for the acquisition, and allocate an extra $3 billion in restricted stock to WhatsApp's founders and employees once the deal closes.

In a blog post, Facebook CEO Mark Zuckerberg said the company plans to use WhatsApp to complement its existing chat and messaging tools.

That said, WhatsApp will continue to operate independently post-acquisition, and the company will invest in both WhatsApp and Facebook Messenger separately.

According to Zuckerberg, WhatsApp currently has over 450 million users, and more than 1 million are signing up every day.

For mobile operators already struggling with sinking operator messaging revenue, Facebook throwing its financial clout behind WhatsApp may not be a welcome move. According to a Facebook press release announcing the deal, WhatsApp's messaging volumes are already approaching the combined SMS volumes of every operator in the world.

But operators have been seeing the writing on the wall for some time, and the deal could accelerate their efforts to pursue mutually beneficial partnerships with OTT providers.

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