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Facebook’s New Message to WhatsApp: Make Money

wsj.com

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Re: Facebook’s New Message to WhatsApp: Make Money

#81

Post by jankey »

xkjkls wrote: post #70
danirod wrote: post #14

Remember when WhatsApp required a subscription? One of the first changes made by Facebook after purchasing WhatsApp was to make it available for free. And now they're complaining they can't milk it enough? Oh dear. I know that a percentage of WhatsApp users would stop using the app if they started requiring a payment again –because apparently paying $1 per year for using an application on your $999 phone is outrageou…

Because they paid $19 billion for it and need some form of return on that investment? You can't just throw stockholder's equity around like that and then come up with a plan that maxes out at ~$1 billion a year in revenue.

Well, they could, as Zuck has ~ 60% of voting rights.

Re: Facebook’s New Message to WhatsApp: Make Money

#82

Post by 24gttghh »

axaxs wrote: post #42
bassman9000 wrote: post #6

Aside from Signal and Telegram, is there any worthy alternative?

I compared them all at one time. Encrypted by default was a must, the rest were excluded. Signal - Featureless Telegram - Not encrypted by default, and controversial encryption Wire - Really liked Wire, but it had a bug of not doing push notifications correctly. Many missed messages until opening the app manually and seeing them. Viber - No real complaint with Viber I guess, I don't quite remember why I didn't like i…

>Signal - Featureless

Come now. Signal has group chats, document sharing, built-in GIF searching (GIPHY), disappearing messages, encrypted calling (video and/or voice), oh and the most important feature: text messaging.

Re: Facebook’s New Message to WhatsApp: Make Money

#83

Post by xkjkls »

eoincathal wrote: post #55

I am more than happy to pay for a subscription to Whatsapp. I have a scattered family and it's a great way for us to stay in touch. As one of the more technically-minded family members, switching to a different service does not bother me but we've got 3 generations on our Whatsapp family groups and its ease of use and familiarity gives it inertia. Not bothered by the idea of a relatively affluent westerner (me) payin…

Pay what though? $1 a year? $10 a year? $100?

They have to find a way to justify the $19 billion purchase price. Almost all charging schemes are only going to get certain fraction of people to convert, and they need to be finding ways to reach similar $20 per user revenue numbers like the Facebook main app has in the US.

Re: Facebook’s New Message to WhatsApp: Make Money

#85

Post by SamUK96 »

russellbeattie wrote: post #78

Whatsapp had a great business model: $1 a year. With their current 1.5 billion users, that's nothing to sneeze at. It doesn't cost them $100M a month to provide the service. I wish more companies were like Craigslist - happy to make an great profit and a lasting business by providing basic information services for a reasonable price. Instead, a bunch of MBAs want to rule the world by focusing on growth at all costs,…

How else is someone with an MBA going to make their qualification look like it means something? It's similar to marketing in many large companies for example, anyone will tell you that most of what marketing does benefits precisely no-one. Users get pissed off about adtech et al - but those "extra 5000 clicks per month!" sound really good in a meeting and without any context regarding sales and PR, etc...

Re: Facebook’s New Message to WhatsApp: Make Money

#86

Post by wlesieutre »

russellbeattie wrote: post #78

Whatsapp had a great business model: $1 a year. With their current 1.5 billion users, that's nothing to sneeze at. It doesn't cost them $100M a month to provide the service. I wish more companies were like Craigslist - happy to make an great profit and a lasting business by providing basic information services for a reasonable price. Instead, a bunch of MBAs want to rule the world by focusing on growth at all costs,…

Glossing over the fact that they probably wouldn't have all of those 1.5 billion users if it had stayed a paid service. Even at $1, having to pay money pushes people off to other free platforms.

Re: Facebook’s New Message to WhatsApp: Make Money

#87

Post by xkjkls »

russellbeattie wrote: post #78

Whatsapp had a great business model: $1 a year. With their current 1.5 billion users, that's nothing to sneeze at. It doesn't cost them $100M a month to provide the service. I wish more companies were like Craigslist - happy to make an great profit and a lasting business by providing basic information services for a reasonable price. Instead, a bunch of MBAs want to rule the world by focusing on growth at all costs,…

How many of their current users would actually be paying $1 a year? Over the long term how many more? Most of these products want to be free. If I'm paying $1 a year to WhatsApp and see my friend using a different app without being charged for it, I feel like I'm getting screwed. I find it hard to think of WhatsApp truly being a long term product with that business model.

Two, claiming encouraging more ads on your platform is "squeezing locked in users for every dime possible" is only half of the equation. Have you ever talked to a business that relies on Facebook and Instagram ads? They're enormously grateful they exist. Without them hundreds of thousands of businesses would not be possible. That shouldn't be thrown aside as worthless.

Re: Facebook’s New Message to WhatsApp: Make Money

#88

Post by xkjkls »

jankey wrote: post #81
xkjkls wrote: post #70

Earlier quoted context omitted.

Because they paid $19 billion for it and need some form of return on that investment? You can't just throw stockholder's equity around like that and then come up with a plan that maxes out at ~$1 billion a year in revenue.

Well, they could, as Zuck has ~ 60% of voting rights.

Their stock just took a 20% dive because their main cash flow engine up to this point, the FB app, is showing stagnating engagement. Unless they want to take even great stock hits, which would lead to: greater difficulty to hire, greater difficulty to finance, more employee turnover, decreased ability to fight government regulation, et cetera, then they can't let this investment be wasted.

Re: Facebook’s New Message to WhatsApp: Make Money

#89

Post by TillE »

xkjkls wrote: post #80
rbreve wrote: post #75

They should try to apply the fortnite strategy, and charge for cosmetic features such as premium emoticons, and profile photos

Engagement is not nearly the same. There are 1.5 billion WhatsApp users, but how many would actually convert. I'd find it hard to see numbers higher than the low single digits.

Apple and third-parties have obviously seen value in selling those stickers and crap. I think there actually would be a decent market for premium emoji.

It's not too difficult to imagine all sorts of fun bonus features in a chat app.

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