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As chat apps become viable for games, Facebook spends big on WhatsApp
As chat apps become viable for games, Facebook spends big on WhatsApp
February 19, 2014 | By Christian Nutt

February 19, 2014 | By Christian Nutt
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More: Smartphone/Tablet, Business/Marketing



Today, Facebook announced it has entered an agreement to acquire mobile messaging WhatsApp for $16 billion -- $4 billion in cash, $12 billion in Facebook stock.

Additionally, the company will pay up to $3 billion in restricted stock units to retain the company's staff over the next four years. Jan Koum, WhatsApp co-founder and CEO, will also join Facebook's board. The deal is still subject to regulatory approval.

For now, Facebook's Messenger app and WhatsApp will continue to operate as separate services, Facebook said. Over 450 million people use WhatsApp each month.

This deal is interesting to game developers because messaging apps are increasingly becoming major game distribution platforms globally: Japan's LINE, China's WeChat (from Tencent) and Korea's KakaoTalk have all made major inroads into (and profits from) game distribution (see how WeChat is doing for an indication of the potential here).

However, Koum spoke out in January against the idea of adding games to WhatsApp. Despite that, now that he and his app are set to become part of Facebook -- which places a big emphasis on games as a revenue-driver -- he may feel the need to change his tune.


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