Why Facebook Paid An Obscene Amount of Money for WhatsApp

facebook-whatsapp100_v-largeEarlier this week, Facebook paid $16 billion for WhatsApp, a relatively obscure messaging app with an arguable ugly user interface. The decision obviously left people scratching their heads. Even analysts called the decision a “stunner” and a “shocker,” not words typically used in finance. When Facebook bought Instagram, which was wildly popular when they bought it, they only paid $1 billion. Google bought YouTube for just $1 billion, too. So, why did Facebook pay so much for WhatsApp?

WhatsApp seems like just another messaging app that lets you chat with people. There are many apps that allow you to do the same thing, from WeChat to Kik to Google Hangouts, Badoo, Oovoo, Tango, AIM, and even Facebook’s own Messenger app. Most of these apps feature much better UX design than WhatsApp.

Since its inception, Facebook has tried to position itself as a high design social networking platform. When the old MySpace allowed people to create their own backgrounds (complete with eye-assaulting neon, animated graphics, and more), Facebook was maintaining tight control over profile designs. More recently, the new Paper app that launched last week is beautifully designed, with lovely swipe to view functionality and softly animated transitions. Also, the “Timeline” profile launched in 2012, a departure from any old-school vertical content. Timeline content introduced different sized images and pieces of content presented both vertically and horizontally.

But, over the years, Facebook has also launched other beautifully designed apps that have failed miserably in the past. For example: Poke. For years, Facebook tried to acquire the massively popular “secret” messaging app Snapchat. But, to no avail. Snapchat’s founders wouldn’t sell. So, Facebook gave up and decided to create their own Snapchat-type of app. After all, an app where the message disappears after a few seconds isn’t hard to develop. Plus, Snapchat was unreliable and unpredictable and had ugly patterns, sloppy animation, and weirdly low-res video. Poke was clean, simple, and easy to use. It was so obviously a better designed app.

Months after its release, Poke had an extremely low adoption rate and Snapchat’s user base was growing at an extraordinary rate. So, Facebook stopped promoting Poke, and had to admit that bad design had beaten their good design. Which brings us to why Facebook would pay so much for a poorly designed app.

WhatsApp is a simpel concept. Its design is supposed to be easy to use and isn’t particularly nice-looking and definitely isn’t innovative. Anyone that owns a smartphone will find the interface intuitive, which is a huge plus.

The app has no animation, no interesting icon systems, no gestural options (swipe to view, etc). There isn’t much design at all, save for some backgrounds. The default background is completely uninspired and looks like something most first year design students wouldn’t even design. Felix Salmon of Reuters called WhatsApp “an ugly, clunky product with a juvenile name.”

But, the functional design is what Facebook’s after, not the aesthetics. At the bottom of the screen, WhatsApp has clear and simple icons for your favorite contacts, your status, your full list of contacts, your currently open chats, and settings. Within a chat, you can tap one button and record a voice message, or tap a different button to upload an image or video. Paper, however beautifully designed, has to teach you how to use the interface, and even then, it can be really confusing. Lots of fancy swiping and transitions. Even if WhatsApp isn’t pretty, it’s easy to use and is inarguably intuitive.

The Snapchat/Poke failure taught Facebook that as often as not, aethestics are not that important to how many users an app has. WhatsApp, for example, has 450 million users. It works well on iPhone, Android, Blackberry, and Windows phones, as well as on more obscure platforms like Symbian. WhatsApp even runs on phones in developing countries that Facebook’s app has never supported. And, when you think about it, chat is the most important thing a smartphone does.

Of course, we’re the first people to say that design is important. Design dictates our world, how we see and take in the stimuli around us. But, there are well built apps and softwares whose design leaves much to be desired. That doesn’t mean that the app itself is flawed – just that it could be so much better. You can bet that Facebook’s purchase of WhatsApp means some design improvements are coming to the app.

Latest Blog Post


More Blog Posts (FPO)

Incitrio provides stronger
Brand Intelligence for B2B

Free Strategy Consultation.
Meet with a specialist to talk through your specific challenges and discover if Incitrio is right for you.