Hacker News Reader

Comment by pitchups | Hacker News Reader

Pretty amazing that this is precisely what Microsoft paid for Hotmail in 1998 : $400 million for 10 million users = $40 / User. [1] The parallels are striking : Whatsapp is to messaging today what Hotmail was to messaging in the late '90s.

[1] http://news.cnet.com/2100-1033-206717.html

View on HN

I'll admit to a distinct feeling, that I've started to lose touch with pop technology. I've never heard of WhatsApp. Though I had most definitely heard of Hotmail in 1998.

WhatsApp has huge global growth. I heard that little chirp everywhere I went in India. friends in Africa use it all the time. in countries with SMS charges, whatsapp is a good deal.

> in countries with SMS charges

The funny thing is that in places like USA, you pay exorbitant amounts (~20 USD per month) for text messaging (when the real cost should be almost 0), yet it's still not caught on here - which is kinda sad.

It's just because it matters more that we have all of our contacts than save $20 a month. I think you'd need higher priced SMS or a very large WhatsApp userbase.

That is a very good point, even if you don't immediately realize the deeper implications. :)

In India, you generally pay per text message - so if you can convince even 3 of your close friends to start using Whatsapp, you save (say) 20% of your phone bill.

Here in US, if you are going to send more than a few texts a month, you are going to be paying 20 USD. So there is no real monetary incentive (initially) for you and two of your friends to switch to Whatsapp.

So why didn't Indian telecoms implement all-you-can-eat messaging to stop the erosion of users moving to WhatsApp?

Indian telecom sector is highly regulated by the Govt. And it is very competitive. So there's no way such an all-or-nothing deal can be introduced so late in the game.

Edit: Moreover, the telecoms do make money on the data plans don't they?

They did for prices ranging from $1 - $2 per month. But text messaging does not do groups remotely as well as Whatsapp does.

You can use it do group thing but then every message sent to group will charged as: cost of one SMS x number of users in the group.

That charge will come to each user of the group whenever a message (%160 chars) is sent.

Even better they partnered with WhatsApp and offer "unlimited WhatsApp" packs:

http://telecomtalk.info/tata-docomo-launches-unlimited-whats...

SMS costs Rs1 per

The number of WhatsApp users in India is still infinitely less than the plain vanilla SMS people. Specially the ones living in villages which is a huge majority with a huger margin.

We also have SMS packs like 100 SMS a month by paying Rs 40 or so. But a DoT rule (which was actually twisted and misinterpreted by telecos) make that plan ineffective on any festive day and on those days you pay for each SMS and the rate is almost double or x3 or sometime x4 of what you would have paid without the SMS pack :-)

The best part is most womenfolk at home, can use unlimited messaging if all they is a wifi connection and absolutely no balance on their pre paid cards.

Essentially WhatsApp is free messaging as long as you have a internet connection. And that's pretty cheap these days.

Agreed, pretty much anyone in the United States above the poverty level seems willing to spend $20 a month for unlimited texting.

I'm way above that, yet I opted for the pay per text plan and paid 20 cents per text. All my friends made fun of me, but I saved a few dollars since iMessage didn't count toward my costs. However, it effected how people without iPhones would naturally choose to interact with me.

Basically, everyone loves iMessage, but no one thinks twice about alternatives. The general assumption seems to be that it's a god given right that you can send a text to a phone number. iMessage did such wonders obscuring that, whereas having to actually download some other app unveils everything.

>> Agreed, pretty much anyone in the United States above the poverty level seems willing to spend $20 a month for unlimited texting.

Even if you are at poverty level and qualify for a free phone (through the Lifelink program, or 'Obamaphone') you still get something like 250 texts included with that

People in the us use messenger. Same as people in Japan use line.

It's usually bundled with data, isn't it?

Yes. Most people seem to have unlimited SMS, yet I doubt few people got the plan they did specifically for unlimited SMS.

s/few/many.

Not everyone has a smartphone. Many of the people I need to text (especially my parents) have feature phones with no data plans.

Having to remember which messaging system you should use for each person is annoying, so most people just use one.

I have a hard time believing that the density of WhatsApp-capable phones is higher across the developing world (where WhatsApp is popular) than in the US.

Probably not, but it's close to equally high, which is one of Whatsapp's strong points.

Additionally, it's not just popular in "the developing world" (whatever that means), but also in many European countries. I haven't seen a map, but I suspect that Whatsapp is very popular nearly everywhere outside the US and China.

I remember that the US didn't really use SMS for a long time, but everybody in Europe did.

The US at the time had generous calling plans, and people there didn't yet discover the nice social effect of communicating silently (with texting).

They used bait & switch in Europe (at least where I was) to entice SMS adoption. There was a multitude of free SMS services: online sites where you could send someone a message for free or SMS a service that would forward it without being charged. Then, in the span of a few weeks, the services disappeared.

iMessages

Here in Germany, nearly everyone in my Contact list with a Smartphone got it. Even though there are relatively cheap plans for unlimited SMS available.

You know we all feel the same in some way http://vmavalankar.svbtle.com/why-facebook-bought-whatsapp

It's not really "pop" technology. Surprisingly, it's not used much in the United States, but in India it's basically a replacement for text messaging. Everyone from a 13 year old child to my grand mom uses it to keep in touch with friends and family members across the globe.

IMHO, they were able to get to such widespread everyday usage because they such awesome and reliable technology. Much better than what Google have been able to provide with their hangouts app, for instance. Messages are always delivered instantaneously if you are online. If you are offline it stores it locally, and delivers it the moment you are online without messing up the order.

Never had any issues with them. They are really awesome. Congrats to them - IMO it's a great acquisition by Facebook.

I've been using Google Voice since 2009 to similar effect. However Google has never attempted to advertise the service.

I thought it was the de facto messaging app across the world? Is there any particular reason why it is not used much in US?

I can only speak for myself, but in the US I have never seen any need for it. I text or iMessage with my friends, and while I have had WhatsApp installed for a long time, I've never found something it does better for me. If I needed to communicate with people I couldn't text with, or if I were paying per text, it would probably be more compelling.

Well, to give you an example, here in Argentina, almost everyone in my phone's contact list uses WhatsApp. Here, the fact that you pay per message is a big incentive. But there are other advantages, like instant delivery, being sure that the message was received (double-check), better feedback ('X is online' when using the app, 'Last seen at 09:22', X is writing...), media sharing, groups, etc. simple things that help a lot. Also, it works both on iPhone and Android...

In Brazil, sometimes a SMS message takes hours to arrive. My bank sometimes send a validation code by SMS, but I can't use it because it expires before arriving.

Some countries use Line rather than WhatsApp

Or WeChat, which is quite big in China.

KakaoTalk is not even mentioned. It's one of the biggest player and probably more famous than anything in S Korea.

ChatOn has some userbase too.

Supposedly KakaoTalk has 90% market penetration in S Korea.

By the time smartphones were widely adopted in the US, SMS already had massive market penetration. Trying to adopt something else when your entire social network already uses SMS is a losing game.

This is why, IMO, Apple, Google and Facebook are the only companies really in a position to change the messaging game in the US. There is space for newcomers (see: Snapchat), but they're going to have to work hard to spread beyond their initial niche.

Apple is driving iMessage adoption via iOS, albeit mostly only for messaging between iOS devices. Facebook has a solid mobile install base already, but they can't seem to figure out how to convince users to use Facebook messaging. It actually works really well for me, but no one I know actually uses it.

Google seems to be in the process of merging Hangouts and SMS. They're already the same app on Android, but you get to pick the protocol. Their logical endgame is to move all messaging to the Hangouts protocol, and fall back to Google Voice to deliver messages to users who don't have a Hangouts client.

If Google can pull this off I think they're going to absolutely kill it, but they seem to be having a lot of execution problems.

I don't know, SMS was huge in Germany as well, there were unlimited plans etc., still, today everyone uses WhatsApp. Group messages, broadcasts, media, cross-platform, and it's of course easier to convince people to use WhatsApp than Facebook.

I lived in the US for a while, and I can't really come up with any reason why it should be different there. Only that way more people are on Facebook (and those are also way more active). Still, I can't really explain why texts stuck around even for smartphone users.

Hm, I could imagine that for those with smartphones unlimited SMS plans came maybe a bit later in Germany than in the US.

When I was shopping for a mobile phone plan for my sister four years ago unlimited SMS were hard to find. Sure, now you get them everywhere, but I don’t think standard smartphone contracts had them four years ago. You had to pay obscenely more (something like double the monthly cost) if you could get unlimited SMS at all. I remember that the high cost of SMS were a real sticking point for my sister.

In my experience smartphone contracts in Germany tended to be much cheaper than in the US but you would also get substantially less for your money. That’s still the case today with included unthrottled data volume.

So maybe that’s one reason why Whatsapp took off. Another one I can think of is that Germany is less of an iOS monoculture than the US. Android is more widespread, so iMessage frequently gets you no benefit at all.

SMS was (still is) huge in the UK too, but all of my friends started using WhatsApp because you could send pictures to each other on WhatsApp without having to use MMS which cost more, was always a hassle to set up and wasn't available on every phone back in the beginning.

I'm in the UK and I'd never heard of WhatsApp until now. I wonder if a lot of these people who say 'X app is big in my country' actually just mean 'X app is popular within my social circle'.

I'm in London, and most people between 20 and 30 that I know of uses WhatsApp. Possibly it hasn't filtered to the rest of the country.

Devon here.. that probably explains it.

WhatsApp has about 50% of the mobile messaging market in the UK, so no, it's just you ;)

> I wonder if a lot of these people who say 'X app is big in my country' actually just mean 'X app is popular within my social circle'.

Yes, that is exactly what it means unless there's some research data provided. Obviously it is easier to scale our current surroundings to the whole country, than to really go around and see how things are outside our social circle. Then again, same applies to you too, just because you haven't heard of WhatsApp before doesn't mean it wouldnt be big in the UK. :)

In Spain, SMS was also the main way of communicating with mobile phones (pre- and post-smartphone). The benefit of WhatsApp was that you didn't have to move to a different "social network" with usernames and stuff, it just used your contact list, and that it didn't cost anything besides your internet connection. So if someone had WhatsApp, you used that, otherwise you texted them through SMS. You almost end up avoiding communicating with people that don't have WhatsApp because they cost you money...

In Spain everyone uses it, from 12 to 60 years old. My mother in low just wanted a smartphone to have Whatsapp. The new trend is Telegram though...

Really? Telegram is a trend? In India I doubt many people even heard about it.

I think I will give it a serious thought if it open sources its code base or otherwise it's as good as Viber or Line as an alternative. Same goes with helm.is.

In Romania WhatsApp is fairly popular, but it's declining. About 60% of my phone's contacts have had it installed at some point, but I noticed that many of them have uninstalled it.

Its popularity has been declining due to Facebook and Android - Facebook on Android works really well lately, most of my acquaintances are on Facebook already and everybody with an Android (which is most of my acquaintances) has either Facebook or Facebook Messenger on it. This is happening because Facebook is the messenger that finally dethroned Yahoo Messenger in my country - really, I'm serious, Yahoo Messenger was still really popular until about 2 years ago. And Android penetration has been phenomenal, due to cheap models being advertised by mobile carriers and sold instead of feature phones.

> Their logical endgame is to move all messaging to the Hangouts protocol, and fall back to Google Voice to deliver messages to users who don't have a Hangouts client.

You're a US citizen and so you might have missed the part where Google Voice is not available outside the US - no alternative can win over SMS, unless it is international.

I actually hate them for trying to take over my SMS messaging and I'm glad that I still have the option of not allowing them to do it on my Android, even though I'm also a regular Hangouts user. What is it with these companies trying to be everything to everybody?

re: your last thought. Google isn't really taking over your SMS messaging in Hangouts as it stands with their current implementation. If you enable "Hangouts SMS" -- it's really just a client side merge of the SMS and Hangouts UI (i.e. SMS does not flow through Google's servers). It just makes it easier to manage SMS and Hangouts conversations side by side through the same app.

I saw that, but if you take a look at the wording they use for denial ("Maybe Later"), that's what they did every single time before shoving it down on all customers' throats. Plus, that question pops up every single time Hangouts gets updated and there's no way to make it stop, because surprise, you can't uninstall Hangouts. The message on the wall is very clear - in future versions of Android Hangouts will be the SMS app.

> It just makes it easier to manage SMS and Hangouts conversations side by side through the same app.

No it doesn't, it's actually quite confusing. At some point I sent a message to my wife, without paying attention if it's SMS or not and so I sent it by Hangouts because that's the default, but she's not using her Google account at all and never received the message. And you have to pay attention like every single time.

It's much, much easier to separate services, when they are in fact different. For SMS, I open the SMS app and I send and receive SMS messages. For Hangouts, I open the Hangouts app and I send and receive Hangouts messages. When I'm not sure what protocol to use for somebody, I go to that contact's details and check out the available options. If I have to read new messages, I click on the notification. If I want to reply to a new message, I'm already in the right app. What could be simpler than that?

Trying to combine Hangouts or any other SMS alternative with SMS in the same app is first of all a huge usability fail - unless that service would fallback to SMS in case delivery didn't happen, in which case there's always the question of unexpected billing, because your phone number is going to have to send that SMS and SMS can get quite expensive - so no, it's an epic failure.

The problem with what Google or Facebook do is that deep down I know it's going to be integrated into their main product, and I won't be able to use it without sharing my real name and friends and everything else tied to the account. Or it will make me create an account, pick yet another password, fill out a profile, yadda yadda. Just thinking about it makes me sleepy.

Why can't it just be simple? Get the app and pick a phone number to message. The SMS situation is so bad that it's got a giant flashing neon sign "Disrupt me please" all over it yet none of the big players are stepping up.

I thought it was the de facto messaging app across the world?

There is no such thing. IM is extremely fragmented into local markets, and you will find different solutions being the de-facto solutions at different locations.

For reference, I'm from Europe and outside the Netherlands I have never heard of anyone using Whatsapp. I tried it once, and it found 2 contacts among my 100s. It was instantly deleted as it was of no use to me.

I also remember it causing stability issues with my Android-phone, ensuring I will never ever install it on anything I own ever, for life, unless my primary intent is ruining that device.

What's "hot" here, or at least what I've heard of people using is MSN, Skype, FB Messenger, Hangouts, Twitter(!) and IRC.

This suggests that its userbase is EXACTLY complementary for Facebook.

you are not buying the user, you are buying their attention.

Not only attention. Also their profile and access to their thoughts which is an asset that big brother is willing to pay for.

In 1984 you needed to hand a copybook to someone you wished to invigilate. Today you invigilate by billions for $40 per head :)

I'll shake my first and one day see people using open standards protocols rather than this morass of proprietary dribble.

Until then, I'm marginally lonely on my xmpp clients, though the facebook integration really helps.

Proprietary messaging apps have a huge advantage in cutting down spam. Solve that and your open standard might just take off.

That's just security through obscurity. Seems to work for iMessage though, I've heard it's obfuscation is something incredible.

Spam prevention is not strictly a security problem, or if you choose to frame it that way it is entirely unlike most other system security challenges. Almost all spam prevention systems have some sort of secret sauce involved, otherwise spammers could train their own systems against it to discover what works. In other words, this is why most open-source security products are extremely competitive with (if not outright better than) their closed-source counterparts, but open-source spam prevention systems (with no disrespect to the people who work hard on them, because as I said, it's a hard problem) suck.

Security through obscurity is not an invalid strategy. If the capabilities of your adversary are low (e.g., bottomfeeding spammers) and the obscurity changes often (e.g., churn in API) it can work just fine.

The messaging part isn't the problem.

The value in Skype, WhatsApp, etc. is the vast amount of work and codebase that goes into punching holes in routers/gateways/NATs to make the internet actually work like it was originally designed.

WhatsApp is not p2p, they maintain a constant server connection which is not a problem for routers/gateways/NATs because its initiated from the client side.

Also XMPP is non-performant and verbose - these things matter as far a protocols go.

More importantly, XMPP has problems delivering the text-message-like experience. It's more of a live-chat protocol. If you want to receive messages when you're offline, things rapidly become a mess.

They shouldn't, though, because pretty much every XMPP server I've seen has user-offline message storage for later delivery eg [1], [2], and the "best practices" have been documented for years, e.g. [3].

Unless you actually mean "receive messages [to your device] when you're offline" and how the hell would that work?

[1] https://prosody.im/doc/modules/mod_offline [2] http://www.process-one.net/docs/ejabberd/guide_en.html#htoc4... [3] http://xmpp.org/extensions/xep-0160.html

fortunately there is improvement in sight: XEP-313 Message Archive Management [0] allows a client to fetch the backlog from its server, at the (privacy) cost of having all your messages stored on the server.

[0] http://xmpp.org/extensions/xep-0313.html

XMPP was designed for desktops with persistent internet connections, it has issues with a non-modified implementation on mobile.

WhatsApp is actually built on XMPP, I believe. I'm not sure how much it's modified it though.

Whatsapp actually uses a modified XMPP server

Trillian! Seriously...ok, I get that these apps like WhatsApp, Viper got tons of users, but please don't give me no BS about them innovating. Trillian solved that problem a long long long long time ago.

I used to really like Trillian, iirc even payed for it once upon a time, but haven't used it in forever... most of my family and a lot of my friends are all on FB, so I check there once in a while.. anyone else will SMS/text me.

If anything, I think I've used google hangouts than most of the other IM platforms lately.

I'm currently staying in Bangalore.

I had to join WhatsApp because most of relatives on Facebook moved on to WhatsApp and there are atleast like 6-7 groups on my WhatsApp. Friends, Office colleagues, cousins and other people.

I'm rarely seeing FB updates from my friends these days. Most of it happens on WhatsApp channels.

So its not a surprise FB bought them. Because if they don't they risk losing all users to WhatsApp, at least that's how it is here in India.

i had the following, icq, msn zone, msn messenger (live, hotmail.....:-), aim, irc, meebo, y!messenger, sms, blackmerry messenger, gtalk/hangout, facebook messages, twitters dms. so far I'm resisting whatsapp, viber...

I'm curious what the future will bring.

I'm always late to adopt things.

But the issue is if everyone else is on a system, the only way to sanely communicate with them is to join that system.

I had to join FB and Orkut for the same reasons.

I'm in Ecuador and most young people (which is a lot here, the average age is 26) use a combination of Whatsapp, FB and SMS. Ex-pats avoid SMS as they are usually on pay-as-you-go plans on $20 phones. It can't be like this forever, as the network effect leans towards a single messaging solution, the carriers will lose their hold on SMS as a revenue stream. But this will depend heavily on universal Internet access.

As one of those expats (starting my 8th year in a little fishing village in pacific coastal ecuador), can I just say --

We're on pay-as-you-go plans, but usually on nice phones we brought unlocked from our home countries. I'm typing this on my trusty Air, which is tethered through an unlocked iPhone 4S.

I'm also listening to waves crash. We got our first swell in a month yesterday, and non-locals are showing up a day late ... 4 or 5 of them. A crowd. I was the only one out for the good stuff yesterday, and I sucked the marrow out of it, and am instead enjoying sitting on my balcony drinking coffee and vagando here on HN. Ahhh.

Where was I? Oh, yes.

I can confirm the crazy-fast penetration of both smartphones in general (probably way over 90% android), WhatsApp in particular, and the FB/WhatsApp/SMS mix.

So WhatsApp isn't the internet here yet. But it's definitely got brand parity with Facebook around here. Which is pretty amazing considering their relative valuations.

I live in Bangalore too! It's just that most of my friends are moving from WhatsApp to Viber and remaining will hopefully move now. I have around 10 groups running from school, boarding, college, jobs and some more.

Fb buying them is a deal breaker. None of my "well read" friends are going to trust WhatsApp with those nude photos, short pornos or very very personal information we share.

I don't know. Facebook just looks like a desperate chap.

Facebook is probably going to get the history of all of the above. ;)

Set aside some time to hide it on your timeline in the near future!

My mom thinks whatsapp is the internet. That's the only app she knows how to use. I have standing instructions to recharge(pay the monthly internet fee) the "whatsapp" every month.

In Romania many acquaintances used it, but most of them have switched to Facebook's messenger. As I was saying in another comment, if I open my WhatsApp right now, most of the people listed as being on WhatsApp have probably uninstalled it, so there's a very real possibility that messages won't ever reach their target, whereas the new Facebook Messenger for Android is catching on like fire.

In my opinion, this is probably the dumbest acquisition I've ever seen.

When they say "450 million monthly active users worldwide and over 320 million daily active users", it's probably safe to assume that they have discarded inactive users. That's also depending on what their definition of inactive means (e.g. have not used whatsapp in 3 months?)

Still struggling to figure out why it's so popular. I read the other article[1] on the front page suggesting that the reason for the popularity is that the app works on low end handsets. But then so does SMS. Is the design of WhatsApp so much better than built in SMS, or is it just the fact that WhatsApp is free? [For me and most people I know SMS is virtually free, but I guess that's not the case around the world]

[1] http://blog.textit.in/your-path-to-a-$16b-exit-build-a-j2me-...

It's popular over SMS because:

- It's not 10c/p per message which if you're talking a lot adds up. - You can send photos and videos and they show up in the stream. MMS isn't actually configured for most people even if it didn't cost 50c a message. - It does group messaging. - Avatars, UI etc

The reason it's popular over apps I think is largely down to savvy use of network effects, particularly that your username is your phone number, so it can scan your phone book and instantly show you who you know that has it. Plus it's available on iPhone, Android, Blackberry and as that article at the top of the main page says, J2ME (news to me but I'm in Europe so not that many feature phones around these days).

I'm from the UK but live in Barcelona and it has 97% penetration here.

[For me and most people I know SMS is virtually free, but I guess that's not the case around the world]

Define virtually free? I pay like 10 bucks a month for unlimited SMS, that's hardly virtually free!!! If I didn't they cost like 10 cents a message. That's an insane price for sending or receiving a very very small message that costs the phone companies almost nothing to send. I see it working well for say prepaid plans or barebones plans.

I would pay maybe £0.09 per SMS if I wasn't on contract. As it is, I am, but I still have to pay to get a delivery notification - that's £0.01 per message or £0.02 depending on your contract. I send maybe 100 messages per day on Whatsapp and probably about 3 texts.

Also, where I live (UK) literally everyone I know who has a smartphone is on Whatsapp. It's completely ubiquitous.

The reason my friends use it rather than Google hangouts, as an example, is the unique combination of features:

* Works on all phones

* Has persistent chat groups

I actually got to know about the Acquisition on Whatsapp! My friend from NYC messaged me on it. Unlike SMS, what I really like about it, is the group chat feature. At any given day, I'm chatting on a group chat with friends from here in the US, Canada, India, Singapore and the UK. For that I pay $1/year.

It's probably paid for itself in just a few days of use.

I second the group chat feature. my family had a constant group chat going on it. It works very well. I see that, and the easy way of sharing of voice, photos and videos as a big advantage over SMS.

Back in the day, I remember using AIM for group chat with friends and instant messaging. Although I've never used Whatsapp, it seems like a mobile equivalent of AIM.

Absolutely the same as AIM messenger or Y! messenger back in the days.

There are some differences which is possibly because it's the mobile equivalent.

One is that you don't have to add any new contact. If anyone on your phone book has whatsapp, they instantly show up i.e your identity is your phone number.

Two when you join a group if there is a person already in the group whose you know in real life, but don't have the number of, it's easy to get their contact into your phone book.

I was able to reconnect with quite a few of my old high school friends using whatsapp. The interesting thing was that everyone spread around the world. Many are in the US, but several are in UK, some are in the middle east, many in India, a couple in Singapore and the group chat made it possible for everyone to instantly connect without having to "add a friend". Plus, no cost difference to send a message to someone in the UK or India.

Like you said, it's the mobile equivalent but the group chat feature is what makes it really useful esp. if you have friends in multiple countries.

In Spain it has replaced sms. Everyone with mobile use it.

In my experience, it's mostly used as a drop-in replacement for text messaging for

- people (especially preteens) with an iPod Touch or iPad Mini but not a smartphone/texting plan

- people with internationally distributed friends

- Android users who want iMessage functionality (friendly long messages, delivery confirmation, read receipts, sane group conversations, etc)

> people (especially preteens) with an iPod Touch or iPad Mini but not a smartphone/texting plan

If I recall correctly, iOS WhatsApp is iPhone only. It won't run on anything that doesn't have a phone number and can't receive SMS or phone calls (necessary for activating the application).

You do not. My brother uses it heavily on his WiFi-only iPad Mini.

Perhaps it's country-specific? I just double-checked and the App Store won't list it in the search on my iPad under iPad-only or iPhone-only, nor in Purchased. I'm in the UK.

When I first bought WhatsApp, I bought it in iTunes on my Mac. I only had iPod touches and iPads at the time, and it wouldn't sync the application to any of them. I seem to recall that I tried to follow a direct link to the App Store entry from Mobile Safari, and it said that my devices were incompatible.

You can, but it is not officially supported.

I had to sideload the WhatsApp.apk on to my Nexus 7 Wi-Fi.

Then you receive your activation code on your phone and tab it in on your tablet.

It works perfectly well.

Don't worry - I have not heard of it either. $19 billion dollars. For that.

Not taking inflation into account. 400 million for 9 million users adjusted for inflation is a bit over $60/user

Except that people weren't paying to get a Hotmail account. WhatsApp users pay $1/year, so their revenues are around that of Twitter's.

you mean $1 once when they first install it? the 'pay this amount' was a well known scam message

Android users pay an annual fee.

I wonder if this is significant in requiring that the person then has set up payments; that must lower the friction on getting those users then to buy other things or make further payments. The time and effort expended is probably for many worth more than the dollar spent?

I've had whatsapp since before it was available in the play store (they had a beta you would manually download back in like 2010 or 2009 or something) and I've never paid a cent... maybe because I signed up when it was still "beta"?

how on earth do they charge it if you don't have a credit card associated with your play account? Because I've used whatsapp for well over a year and can't figure out how they'd charge me.

Well , I did have to pay once. Your watsapp just stops syncing until you pay via Play.

I don't know, but they have your phone number. In the UK at least that can be done with a premium SMS.

My first year free just ran out. They sent me a message that I get to continue for another year for free. It's hard to believe anyone pays for this.

Have you been a heavy user? I have a sneaky feeling that they will let light users have it free, but start charging heavy users. That makes sense, because if you are a light user, there is not a lot incentive to pay.

I use it every day and I got my free account expiration date upgraded to "lifetime". Admittedly, I'm a light user regarding bandwidth usage; I do share some pictures, but probably a lot less than the average user. I honestly don't think I know anyone who pays the annual fee.

Due to network effects, it makes very much sense to let frequent users ride freely (perhaps not bandwidth hogs, but frequent communicators with multiple friends), as they'll bring in and keep many other users in the system.

I'm an extremely heavy user, hundreds to thousands of messages and images per day, and I've had the same messages so I think it's the heavy users that they're allowing for free.

I think they don't charge countries that don't support payment on app store

That can't be right since the UK App Store supports payments and WhatsApp have never asked me for any money (but I was a light user before I ditched it for LINE.)

That changed. The app is now[0] free and it's $1/year, in every platform.

[0]: http://www.theverge.com/2012/12/20/3787472/whatsapp-for-ios-...

That's just free to download. You still pay per year fee.

Well I've been a user for 5 years and I've only paid my 0.99c fee. And I don't know anyone else who has had to pay a 'membership'

It made more sense for MS though. They were basically kickstarting their internet services and had very few users.

Facebook can mine some more data from this I guess, but something rather marginal from what they already have.

True, the reasons are different. But the motivation is the same : to stay ahead of the competition. In my view, and based on my own experience, Whatsapp is being used as a light-weight social network built around messaging and optimized for mobile phones. In fact, I share a lot more stuff with friends and family on Whatsapp - including pictures/videos/messages - than I do on Facebook.

The more Whatsapp satisifies my sharing needs, the less I use Facebook. And that is a competitive threat to Facebook. Instagram was similar - a light-weight social network built around photo-sharing.

I think Zuckerberg is a deeply strategic thinker trying to avoid the pitfalls of the "Innovator's Dilemma". Both Instagram and Whatsapp are classic examples of what is described in Innovator's Dilemma - light-weight products that can slowly eat into the market share of the incumbent, and ultimately displace it.

Edits : formatting.

yes yes and yes.

But boy - 16 billion.

The opportunity cost is much larger if they miss out. It's the difference between ponying up tons of cash to stay relevant or fading into obscurity.

But it in no way ensures they stay relevant. It is literally just blindly flailing around buying anything that gets a lot of users out of fear and having no idea how to maintain their position.

It doesn't ensure they stay relevant but it's a better strategy than watching your target demographic leave your platform.

It's a $19B investment in trying to keep people on Facebook. $20B if paired with Instagram and $24B if they had acquired SnapChat.

The numbers sound crazy but they're trying to hold on to and grow a market cap that's currently $175B.

Zuck has some steel nuts but it's what got him to the $175B number in the first place.

>It doesn't ensure they stay relevant but it's a better strategy than watching your target demographic leave your platform.

I don't see any evidence to support that claim. It is a different strategy, but I don't see any indication that it is better. Flushing a few billion dollars down the toilet is a different strategy too, but that doesn't make it better.

Facebook's only job is staying alive. That's the very minimum they can do, and is all they're trying to do.

But they are trying only with tricks and short term solutions just to keep their stock prices high. Acquiring everything isn't a planned strategy for growth but rather a fear of the next facebook strategy, which obviously is not and couldn't be WhatsApp. Instagram maybe but still...

If someone else acquired WhatsApp, would be the fear.

Scale matters. $400M vs $16B.

How much of that $400M price was set based on $-per-user?

On top of that, this was back in the first bubble, and we saw how that went.

You mean almost at the height of the dotcom bubble? Maybe that should say something about this acquisition.

You mean one of the more sensible purchases amidst all the idiocy of the first dotcom bubble? I mean, I fail to see how buying Hotmail was a bad idea for Microsoft.

The parallels are striking : Whatsapp is to messaging today what Hotmail was to messaging in the late '90s.

With 10 million users, you could grow 100x, or more.

With 400 million users, 100x growth is harder.

Microsoft also paid $8.5 billion for 663 million Skype users in 2011, which works out to $12.82/user.

You are comparing Skype to WhatsApp? Don't you think it's kind of apples and oranges? Skype had technology that Facebook itself uses for video chat and WhatsApp supposedly has a large user base which mysteriously enough is so different than FB user base, that it's worth $16b?

As someone who is a heavy user of both Whatsapp, GTalk/Hangouts and FB Messenger, I find Whatsapp to be much faster than others. So, there could be some technological value to this deal.

Microsoft had its own Live Messenger and Lync too, so the acquisition in both cases was for the user base and the brand than technology IMO.

Hard to compare though. Microsoft had barely any internet/web users back then. They had zero email users. Facebook has a billion or so give or take. All of which can get Facebook messages in their mobile apps already. How much overlap is there with Whatsapp?

> How much overlap is there with Whatsapp?

This is the question. Apparently a sizeable number of teenagers and pre-teens have zero interest in FB. It's where their parents post cat pictures and make dinner plans. From what I understand, Kik, WhatsApp, and Snapchat are all what's "cool" with the under 18 crowd. This move may ensure that FB still has sufficient data to mine on this demographic in the future.

You know we all feel the same http://vmavalankar.svbtle.com/why-facebook-bought-whatsapp

On the other hand Microsoft buying Nokia's phone business in a $7.2 billion seems like good bargain since they are supposedly have more than billion users. WhatsApp is just an App.

Whatsapp is incredibly lean. I believe the only have 32 engineers working for them. I can imagine Nokia has much more expensive baggage in their name

Sun Microsystems was aquired by Oracle (java, mysql, hardware division, patents and all) for $5.6 billion. Sun could probably be said to have more 'users' than what's app, but it's a different context for the user.

Motorla Mobility was aquired for 12.5 billion.

I don't even know what to compare the whatsapp aquisition to. The valuation seems quite insane.

Microsoft/Hotmail deal normally considered to be at the top end of the price range of pre-bubble acquisitions. I.e. it was really expensive back then too.

Reply on news.ycombinator.com