When Facebook spent $19 billion to acquire the platform back in 2014, it was evident that the social networking giant will go ahead with the monetization plan of this popular chat messaging app. WhatsApp’s Vice President and Spokesperson, Chris Daniels made the announcement. He clarified that the service will continue to be free for end users, there is no plan to charge any fee. At an event in New Delhi, WhatsApp’s VP said that ads would be the primary monetization for the company.
WhatsApp introduced a feature called ‘WhatsApp Status’ early last year. The feature is similar to Stories found in Instagram and Snapchat. WhatsApp Status allows users to add a combination of text, photos, and videos to reach out to their contacts. The status updates are visible for 24 hours before they are automatically deleted.
The feature is actively used by 450 million WhatsApp users. These users will be the first target for advertisers. WhatsApp users will see the promoted status messages within WhatsApp Status. The feature will help users learn more about nearby businesses and their offerings.
The platform has a steady revenue stream from WhatsApp Business API. Businesses use the API to send important messages (like MakeMyTrip tickets), they pay the platform for using the API. The move to push ads through status updates makes a lot of business sense but from the user’s perspective, it will definitely impact the user experience.
In 2014, before the acquisition, WhatsApp was strongly against using ads to generate revenue. The company was planning to charge an annual fee of $0.99 to users. The idea of monetization has been debated within the organization as well.
WhatsApp co-founders were rumored to have major differences with Facebook CEO Mark Zuckerberg over the issue of monetizing the platform that even led to them exiting the company a few months back.