What’s behind the $19 billion deal …the plan to shut down WhatsApp Services?

The WhatsApp messenger service, which made a deal last Wednesday for Facebook to purchase it for $19 billion, had an outage on Saturday which lasted by some reports around four hours.  As a result, frustrated users were lighting up social media with complaints and questions about just when the service would be restored.  Yes others were joking about having to actually interact with real people without the messaging service.  In addition, in light of its recent acquisition by Facebook, many were proposing the conspiracy theory that perhaps the buyout was simply a ploy to gain control of the service and shut it down in order to funnel the popular service’s approximately 450 million users over to Facebook.

During the messaging service’s downtime, users saw only a loading asterisk and the alert “Connecting…”

The conspiracy theories and unrest were quickly settled, however.  Tech support at the company soon realized that the issue was occurring and sent out a tweet stating that they were “experiencing server issues” and  that “we hope to be back up and recovered shortly.”

By 10:48 p.m. the issues had been resolved with the company tweeting out:  “WhatsApp service has been restored. We are so sorry for the downtime…”

While it has not been clarified exactly what they server issues were, it appears that the company simply experienced some sort of technical glitch, perhaps due to its quickly rising popularity.  It has been reported that five-year-old WhatsApp continues to add about 1 million new users daily.  In addition, it is currently ranked number five in Apple’s app store.

And, despite the conspiratorial slant that some social media postings took yesterday, it appears that harnessing this explosive growth, rather than shutting it down or sending it over to Facebook, is the real purpose of the purchase.   As teens increasingly leave social media networks such as Facebook in search of Internet hangouts where their parents and grandparents are less likely to be looking over their shoulders, the use of smartphone-based apps such as WhatsApp, which currently leads this market, have soared.  For Facebook to embrace this movement rather than trying to force its users into an environment which they are moving away from in droves only makes sense.

The $19 billion deal between Facebook and WhatsApp was comprised of $4 billion in cash and $12 billion worth of Facebook shares.  In addition, the founders and employees of WhatsApp are to receive an additional $3 billion in restricted stock units to be paid in four years.

In speaking about the deal, Facebook founder and CEO Mark Zuckerber said that “WhatsApp is on a path to connect one billion people. The services that reach that milestone are all incredibly valuable.”

Also, the co-founder and CEO of WhatsApp, Jay Koum, noted that, “WhatsApp’s extremely high user engagement and rapid growth are driven by the simple, powerful and instantaneous messaging capabilities we provide.”  He further stated that,  “We’re excited and honored to partner with Mark and Facebook as we continue to bring our product to more people around the world.”

Despite any momentary swirling of conspiracy theories during Saturday’s outage, the comments of the two companies’ CEOs indicate that Facebook has no plans to shut down WhatsApp anytime soon. Source: The Guardian

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