Facebook recently announced that it has finalised the WhatsApp deal with the European Union giving a go ahead, after Federal Trade Commision (FTC) in US approved the deal in April this year.
Facebook has been on a spending spree, after recently acquiring different software giants across the various sectors, even with the Instagram deal going through for $1 billion in 2013 and a recent purchase of the virtual reality headset maker Oculus VR for $2 billion in July. This deal though dwarfs both of these deals and comes at the cost of just under $22 billion, burning a hole in the company’s pockets; having to end up paying more than what it was supposed to incur initially when the deal was finalised in February because of the rise in the stock prices of Facebook.
Whatsapp founder Jan Koum will now be part of the Facebook board of directors, receiving an annual base salary of $1 with about 25 million restricted stock units if he stays in the company for four years. Although he shares the same annual salary with that of Mark Zuckerberg, he’ll not be entitled for the company bonus under the Facebook’s bonus plan.
Whatsapp till now was a separate entity from Facebook but after the deal being finalised the messaging application’s future stands in limbo. Facebook promised FTC that the privacy policy of Whatsapp would not change and a lot less data would be mined and shared with third parties. Just to make it sure it keeps its promise and no rule is broken, FTC is keeping an eye on both the companies. With over 600 million active users on a monthly basis on the app across the globe, Facebook is only digging its hands deeper into more data mining with already over 1.4 billion active users on the social media giant.
EU has over ruled that Facebook’s own messaging service the Messenger is not directly competing with Whatsapp and that both of these entities can co-exist on the same mobile handset as both of them require different sign in ids.
With this deal in place, Facebook is eyeing the handset market, which has a huge potential for new users adapting to the smartphone era in emerging markets. What Zukerberg has in mind for WhatsApp will surely be seen in the coming months, till then all we can do is play the waiting game and hope that the users continue to enjoy their privacy on the messaging app!