The latest acquisition of Mark Zuckerberg, WhatsApp, has the largest number of active users, being the application of the moment – with 800 million people logging into their accounts every day, to send messages and to make calls. It seems that over 30 billion messages are sent every day, but this is not enough to recover the original investment. Zuckerberg spent $22 billion on WhatsApp and in the first six months of 2014, the application generated only $16 million in revenue. Many users want to avoid paying the annual fee of $0.99, and this is a big problem.
Facebook has new plans with WhatsApp, even if the $0.99 annual fee will be extracted. It seems that the developers want to monetize the service and to not force their users to pay money for using it, after the trial ends. Facebook CFO Dave Wehner attended the J.P. Morgan technology conference, where he spoke about WhatsApp and the business-to-consumer communication functionality, which was introduced on the Facebook messenger.
KakaoTalk app already teamed up with a few businesses and the users can benefit from taxi booking and gift purchasing, but there are also other messaging applications from Asia with similar e-commerce capabilities. WhatsApp is more popular in Europe and on the American continent, and that’s why Zuckerberg wants to implement the same business-to-consumer monetization strategy, because in these regions, the application could generate huge revenues.
In the first half on 2014, WhatsApp lost $232.5 million and if Zuckerberg will couple business-to-consumer messaging with payments capabilities, the application could become extremely profitable. But, there’s a minor problem with the similarities between Facebook and WhatsApp, because the users will choose to install only one of them, not both, although the owners stated many times that the applications are complementary. Not all of our friends are using only one of the applications, and to keep in touch with the rest of our friends, we need to install the other application.
In short time, WhatsApp will hit a new milestone: 1 billion active users and Facebook CEO Mark Zuckerberg will take advantage of this number and invite businesses onto this application at the right time.
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