Advertisement

HindustanTimes Thu,23 Oct 2014

Web Service Reviews

Advertisement
Zuckerberg says $19 billion for WhatsApp deal was cheap; talks about Internet.org
First Published: 23:32 IST(24/2/2014)
Last Updated: 09:05 IST(25/2/2014)

On the first day of the 2014 Mobile World Congress, Facebook CEO Mark Zuckerberg spoke about various issues that plague the present day internet environment.

As expected there were questions on Facebook's recent $19 billion aquistion of WhatsApp.

Mostly, the interaction revolved around his next big project 'Internet.org' with which Zuckerberg said aims at connecting each and everyone in the world.

He also answered questions on NSA and how it was "way over the line" in terms of not being transparent enough in handling Snowden's case.

On Whatsapp

Zuckerberg defended his huge $19 billion takeover of free mobile messaging service WhatsApp, saying it is actually worth much more.

The 29-year-old Facebook chief announced the stock and cash purchase on Wednesday, a deal that marries his social network of 1.2 billion active users with Whatsapp's 450 million users.

Asked about the price tag during an on-stage discussion at the February 24-27 Mobile World Congress in Barcelona, Spain, Zuckerberg said WhatsApp was attractive as a company by itself, and as a strategic fit with Facebook.

"I just think that by itself it is worth more than $19 billion [14-billion-euro]," said Zuckerberg, wearing a grey t-shirt, sneakers and black trousers.

"I mean it is hard to exactly make that speech today because they have so little revenue compared to that number," he conceded.

"But the reality is that there are very few services that reach a billion people in the world. They are all incredibly valuable, much more valuable than that," he added.

"I could be wrong. This could be the one service that gets to a billion people and ends up not being that valuable. I don't think I am."

Other Android messaging applications such as KakaoTalk, Vine and WeChat were already bringing in two to three dollars a person "with pretty early efforts", he said.

'Going to be a huge business'

"That shows that if we can do a pretty good job of helping WhatsApp to grow then this is just going to be a huge business," Zuckerberg said.

"So even just independently I think it is quite a good bet."

In partnership with Facebook, WhatsApp can focus on connecting "one, two, three billion people over the next however long that is going to take," Zuckerberg said.

The Facebook boss said he and WhatsApp founder Jan Koum shared a vision of connecting everyone in the world to the Internet, delivering development benefits and in the longer term profits, too.

Zuckerberg said Facebook planned to leave the WhatsApp service unchanged.

"WhatsApp doesn't store the content," he said. "We would be pretty silly to get in the way of that."

Hours earlier, WhatsApp's Koum said the messaging service would launch free voice calls by mid-year, putting it on a par with key competitor Viber which already does so.

He, too, stressed that Facebook did not plan to change WhatsApp. "Mark really understands that for WhatsApp to be successful it really needs to stay independent," he said.

Zuckerberg has come a long way in the mobile world in a short time.

When Facebook sold its shares to the public in an initial public offering in May 2012, "it literally had no mobile advertising revenues", said Eden Zoller, analyst at the research house Ovum.

"It did actually have a pretty strong mobile user base at IPO but what it had failed to do at that time was actually monetise those mobile users," she said.

At the time of the float, worries over the lack of money coming in from the mobile business sent Facebook's shares sliding.

But the social network -- boasting more than 1.2 billion members -- quickly repaired its strategy.

By the end of 2013, mobile devices accounted for 53% of Facebook's advertising revenue, bringing in $1.2 billion in the last quarter and more than $3 billion over the whole year.

Highlights from other issues he talked about

On Internet.org:

# Most people don't have access to the internet at all. It's about 2.7 billion people now

# Vision isn't to connect one seventh of the world, it's to connect the whole world

# It's not that connectivity is an end in and of itself, it's what connectivity brings

# First is affordability. Internet needs to get a lot cheaper

# It's a coalition that's working together to make delivering the internet more efficient

# We wanted to start with Facebook because we can control it and control the up-sales better

# A lot of them have the money to afford it, they don't know why they'd want access to it

# Why do the next two or three people who are going to get on the internet not on the internet now

# I really believe that spending money on the internet really is the rational thing to do

# If we do something that's good for the world we'll find a way to profit from that

# I think we're probably going to lose money on this for quite awhile, but its a long term plan

# More spectrum availability would help, along with reduced costs of smartphones

# A year ago the average person used 14MB per day through the Facebook app. Now they're down to 2MB

# Facebook shouldn't get all the credit, it is a big coalition across the industry

On NSA:

# The NSA issues I think are real issues for American internet companies. Trust is so important

# I'm glad that they now have the permission to share the requests that we get

# NSA was "way over the line" in terms of not being transparent enough.

# NSA are only now starting to get to the range of where they should have been

(with inputs from AFP)


comment Note: By posting your comments here you agree to the terms and conditions of www.hindustantimes.com
blog comments powered by Disqus
Advertisement
Copyright © 2014 HT Media Limited. All Rights Reserved