Facebook Just Bought Your Phone Number from WhatsApp

Facebook Just Bought Your Phone Number from WhatsApp

February 23, 2014

The biggest tech story of last week unquestionably was Facebook’s acquisition of WhatsApp for $19 billion. That astounding figure is six times more than the $3 billion that Snapchat turned down. They spent $340 million for every WhatsApp employee.

So why exactly do you think Facebook paid megabucks for this acquisition? It certainly isn’t for the revenue potential. WhatsApp charges its 450 million users $1 annually to use the service. We aren’t math geniuses, but that’s an estimated $450 million in annual revenue. Facebook has promised not to insert ads into the service to squeeze more money out of it. So, even if the service continues to grow, it’s going to take many years to even get close to the $19 billion they paid for it.

Which leads us to the next question. What does Facebook consider more valuable than pure revenue? Data! More specifically, they want your data. They bought WhatsApp because it gives Facebook access to a wealth of user data, opening up both mining opportunities, and possible privacy concerns.

WhatsApp’s privacy policy is not great (some would call it horrible). They can access your address book, scoop up phone numbers and upload them to their servers. Think about that: even if you don’t use WhatsApp, if one of your contacts does, your number is stored on WhatsApps servers. Now, Facebook has billions of phone numbers and there is a good chance they have your mobile phone number. What they do with this data is yet to be seen. But one thing we know for sure is that that whopping price wasn’t about money, but really about user data.

Some people are already bailing on WhatsApp. Are you a WhatsApp user? Will you stick with the service? Let us know in the comments section below.

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