Why Selling WhatsApp to Facebook Would Be the Biggest Mistake (2012)
forbes.com
forbes.com
The HN thread -
IIRC, a while before the sale Whatsapp tried to introduce some meagre subscription, on the order of dozens of cents, which got a lot of backlash. Then, a bit after that, it got sold.
The servers don't pay for themselves, and if the user base wasn't going to pay for use, money had to be manifested in another way.
I started in 2011, and the subscription language was present, but there was no mechanism for payment. Then we put payment into Android, but frequently would extend all subscriptions. At some point the iPhone model flipped to match the rest, but if you had registered with iPhone before the switch, your account was set to lifetime.
I don't know the timeline, but towards the end there was a small list of countries where we would actually enforce loss of service for about a week when the subscription ended. After a week, we'd extend the subscription for a while anyway, because it was probably hard to pay (we tried to pick subscription enforcement countries where payment was readily accessible, but lots of people don't have a compatible mode of payment even if they have the means to pay)
We were told the company was cash flow positive, the public GAAP numbers look bad, but a large part of that is stock based compensation; a small part is accounting treatment for the lifetime accounts.
Also, it's important to note that the acquisition happened before real time voice and video calling launched and running servers for that was expected to be expensive.
Being paid never hurt its adoption at all in the UK. Teenagers like me were perfectly happy to pay 99p to get inter-platform IM.
To offer a counter example, it definitely did in Venezuela, at least in the beginning, where it initially lost dominance to BBM
Back then online payments were not that common, and most cards had weird restrictions on using USD in general
* https://www.theguardian.com/technology/2016/jan/18/whatsapp-...
The only way to break this "jail" is to split internet protocols from the clients, with stability in time. Only regulation can save us from the new AOL.
But for a while now they’ve decided to create their own server nodes (“chatmail relays”) and heavily promote the use of those instead of your mail provider’s. While those are also just SMTP/IMAP, you still need a different domain and account i.e. different username - which makes them just another chat network which happens to be interoperable with classic emails... for now.
My point is: There seems to be some tendency for things to go proprietary.
Social media and chat apps are successful because of the network effect.
Let's say I have ten friends. Nine of them use the same app exclusively and one uses another app.
If everyone want to stay in touch with all of them, the two most likely things are 1) the tenth friend migrates to the common app, 2) the tenth friend installs both apps. In both cases, most interactions use the common app, unless the tenth friend is so influential that everyone switches to the other app just for the sake of them.
When you want your app to be popular, you want to discourage people leaving your app for someone else and you want to encourage people to use yours (better features or, more commonly, a larger user base). As a result, unless there's any external force going in the opposite direction (regulations or just people really hating lock-in), you'll build your services so it's not that easy to leave. Better features are an alternative, but at some point new original features are hard to come by and can be expensive.
This is especially true if you want to make money through subscriptions, downloads or selling data, because the more users you have the more you earn, but it could also be true in free apps if the owner wants visibility.
Again, I don't know DeltaChat, but this is unfortunately the general trend.
I remember Jason fried - 37Signals - saying the same thing - that Basecamp was such a home run for them that all their other ventures will not match it.
something for all of us to learn for sure