The Bigger Picture - The Facebook-Whatsapp plan
The more I think about this $19B deal, the more sense it makes; not financially, in the short-term, but in the larger scheme of global domination of the communication scene.
WhatsApp is growing rapidly; at a more rapid pace than Facebook. 1 million users per day is what some report.
Now, if this pattern of growth continues and actually fuels behaviour over the next few years where WhatsApp becomes the default messaging communication tool on your phone (preferred) over the mobile-operator run SMS system - there will be world domination.
The basics of logic coupled with the theory of evolution will ensure a world where almost everyone eventually will have data enabled on their phones. WhatsApp is an app which works really well across 2G networks too; additionally, free WiFi across the board is also something which is bound to happen latest by 2020.
Who are the ones who should be most scared?
Mobile operators - all over the world.
The current voice chat feature actually ensures that you can have a decent over-and-out chat with anyone in the world. With a rumored calling facility (like Viber) set to come in soon and with a natural progression of video chat coming in later, why would one need the services of AT&T/Vodafone/T-Mobile etc.
Think about the potential revenue loss possible because of this. Firstly, Facebook pays mobile operators, in a lot of countries, to send their users SMS notifications. This, of course, will be the first cost one will save on when WhatsApp takes over SMSing. With WhatsApp actually driving people to data-enable their phones, everyone being connected should ensure FB app notifications suffice.
Updating your facebook status or commenting on threads via WhatsApp is a possibility too.
Now sample this - WhatsApp API’s being integrated to banking systems, every time you use your credit card - you will now get a WhatsApp message rather than an SMS. This will extend to everything: Billing notifications on WhatsApp, service confirmation and transaction messages on WhatsApp etc.
This is the revenue line.
Companies currently pay mobile companies (who in turn have deals with mobile operators) for managing automated and bulk SMS solutions. These companies will now switch to integrating WhatsApp API’s. These API’s and messaging services clearly won’t be free for companies to use.
Now think about controlling all this on a global level - It’s going to be crazy!