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Facebook Buying WhatsApp for $16B in Cash and Stock Plus $3B in RSUs

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Re: Facebook Buying WhatsApp for $16B in Cash and Stock Plus $3B in RSUs

#461

Post by michaelmior »

yapcguy wrote: post #340
dba7dba wrote: post #222

Earlier quoted context omitted.

CEO of Whatsapp prided on not listening in private conversation or collecting personal data, which Facebook ACTIVELY does.

The CEO just had a higher price than most other people. To get $16bn cash from Facebook is hilarious. Next time a start-up says they won't pay you market rate because of x, y, and z just walk away and laugh. For the sake of a few thousand dollars in wages, you could make them billions. Don't work for cheap bastards. Funny how engineers are supposed to sacrifice yet we never see a lawyer or accountant charge below mar…

I think it's quite rare that any individual employee (probably excluding founders) is responsible for a significant percentage of the value of a company.

Re: Facebook Buying WhatsApp for $16B in Cash and Stock Plus $3B in RSUs

#462

Post by sentenza »

bedhead wrote: post #432
bedhead wrote: post #64

When these bubbles really get crazy, you start questioning your sanity and wondering whether maybe you're just plain wrong. You actually start wondering if the valuations are justified after all, whether it be a house, stock certificate of a tech company, the mineral rights to some acres in the Haynesville shale, or some land on the Vegas Strip. My head hurts.

I have two additional and unrelated thoughts on this. First, the astonishing price paid is a very tangible indictment on the management of Facebook, and Zuckerberg especially. Combine this $19 billion with the Snapchat offer and Instagram, and it's clear that Facebook is looking frighteningly like Microsoft, which is to say a behemoth of a company that seems to flat-out miss every next big thing. I can't even imagine…

Something's fishy though. Compare these acquisition numbers to the numbers that float in more "money-prone" parts of the software business. For instance, I've never heared of that kind of money being thrown around regarding the suppliers of software that banks and traders use.

It's not that a revolutionary social service shouldn't be worth billions, but What's App is messaging. And messaging in the long term could just as well boil down to a specified standard with half a billion apps out there that support the standard.

There's no reason why messaging should be a market that can be dominated by a single player over more than the social network percolation timescale.

Re: Facebook Buying WhatsApp for $16B in Cash and Stock Plus $3B in RSUs

#463

Post by lsc »

pbhjpbhj wrote: post #381
orbifold wrote: post #229

Earlier quoted context omitted.

Some years ago the dominant messaging apps were icq and aol messenger and msn messenger. I think almost every new generation just uses their own messenger.

Presumably IPv6 will be a major change - that will allow every person to have an IP address for every device they have and retain that perpetually. Then we can have true direct messaging and use open protocols (XMPP?) each person choosing a client to manage their end; like how email works now. If you can send from Whatsapp to FB messenger, Viber, Skype and whatever - and vice versa - that's surely going to democratis…

>that will allow every person to have an IP address for every device they have and retain that perpetually.

Wait... what? has someone implemented IP address portability while I wasn't looking? I mean, there was lots of talk a few years back, but my understanding is that the facts on the ground are such that when you switch ISPs, well, you are switching your IPv6 address (unless you are large enough to speak BGP)

Re: Facebook Buying WhatsApp for $16B in Cash and Stock Plus $3B in RSUs

#464

Post by chockablock »

recursive wrote: post #403
antr wrote: post #17

I used WhatsApp to stay away from FB's chat app. Telegram is picking up popularity within my circles... I'll default to that

Is there some reason people don't like sms?

per-message billing by telcos, high costs for international messages, no identity management (only tied to phone #), not cross-platform, character limits (MMS, the workaround, is historically janky), no delivery confirmation, lack of end-to-end encryption. Shall I go on?

the only thing it has going for it (and it's a big one) is ubiquity.

Re: Facebook Buying WhatsApp for $16B in Cash and Stock Plus $3B in RSUs

#465

Post by djs123sdj »

001sky wrote: post #215
staunch wrote: post #170

Damn, Zuck is far more paranoid than I thought. He's going to have to come up with a better strategy than buying every company that presents a potential existential threat though. Especially at these prices! I actually think it wasn't such a bad idea to buy Instagram. He paid 1% for something that really could have killed him. But paying $16 billion here is pretty much surrender as far as I'm concerned.

Even if its a rope-a-dope its potentially a smart move. He needs to roll-with-the punches and keep in the lead. Once evaporative cooling kicks in, its not going to be a good ride. So its really best to do whatever is possible to stay ahead...even if that means being the borg of social networking. He has enough of a lead and can accept enough dilution that it remains worth it to continue to layer the next generation o…

holy metaphors!

Re: Facebook Buying WhatsApp for $16B in Cash and Stock Plus $3B in RSUs

#466

Post by boomzilla »

scrabble wrote: post #387
olegious wrote: post #243

Earlier quoted context omitted.

Android users pay an annual fee.

My first year free just ran out. They sent me a message that I get to continue for another year for free. It's hard to believe anyone pays for this.

Have you been a heavy user? I have a sneaky feeling that they will let light users have it free, but start charging heavy users. That makes sense, because if you are a light user, there is not a lot incentive to pay.

Re: Facebook Buying WhatsApp for $16B in Cash and Stock Plus $3B in RSUs

#467

Post by cortesoft »

selectodude wrote: post #382
tomblomfield wrote: post #81

Sequoia just landed a 5x return on their fund with this one deal. At a rough guess, they put in $8m for 15% of the company in 2011, valuing it at around $53m. A $16B sale is a 300x increase in value, so Sequoia's stake is worth $2.4bn. Their standard fund size is around $500m. http://www.reuters.com/article/2013/08/16/us-sequoia-funds-i...

Not too bad for the two founders then. 6.8 billion dollars each.

There are surely a lot of other shareholders besides the founders and sequoia.

Re: Facebook Buying WhatsApp for $16B in Cash and Stock Plus $3B in RSUs

#468

Post by sentenza »

myzerox wrote: post #450
sentenza wrote: post #441

Earlier quoted context omitted.

Remember when we had standards and interoperability? Why would messaging be a winner-take-all market? I mean, it's just pushing around a bunch of bytes. Shouldn't be too difficult to specify.

It's because of network effects. (I'm not going to switch to the 2nd best app where I can only reach 10% of my friends.)

But the network effects are still there if you have an interoperable standard. You can use _any_ app that supports the standard and still connect to everybody in the social network.

There is no reason why the social network of mankind should remain captured in the userbase of a single messaging app. And it is the abstract social network that does provide the network effects.

Re: Facebook Buying WhatsApp for $16B in Cash and Stock Plus $3B in RSUs

#469

Post by leggo2m »

smackfu wrote: post #388
adventured wrote: post #304

Earlier quoted context omitted.

Zuck should probably be fired (gracefully step-aside, courtesy of shareholder activist pressure, given his voting control) when Facebook is forced to do a $16 billion write-down on this. WhatsApp won't even be worth the cash they're paying for it when the music stops. They just bought today's version of ICQ for $19 billion. This acquisition leads me to believe Facebook is most similar to Yahoo at the peak of the dotc…

Heh, AOL bought ICQ for $287 million, and it had 12 million users. $24 per user. Now AOL was really good at destroying companies though...

AOL also bought Bebo for $850M and then sold it back to the founders for $1M a few years later.

Re: Facebook Buying WhatsApp for $16B in Cash and Stock Plus $3B in RSUs

#470

Post by Larrikin »

nullspace wrote: post #422
crucialfelix wrote: post #416

Earlier quoted context omitted.

WhatsApp has huge global growth. I heard that little chirp everywhere I went in India. friends in Africa use it all the time. in countries with SMS charges, whatsapp is a good deal.

> in countries with SMS charges The funny thing is that in places like USA, you pay exorbitant amounts (~20 USD per month) for text messaging (when the real cost should be almost 0), yet it's still not caught on here - which is kinda sad.

People in the us use messenger. Same as people in Japan use line.
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