Why did Facebook pay $1 billion for Instagram?

The purchase of the mobile picture sharing app by Facebook for a whopping $1 billion has sent shockwaves through the industry. While Facebook users are delighted with the agreement, Instagram users have varied feelings about it.

The most crucial issue that arises during the violent battle and the battle of words (amongst rival loyalists) is “Why did the social media giant Facebook agree to spend $1 billion to a startup with no revenue?”

In the next section of the post, we’ll provide the solutions for you:

• It’s possible.

Facebook has a lot of money, according to its S-1 filing. According to reports, Facebook has just under $4 billion in cash on hand, indicating that it can finance the transaction.

• It desired to maintain a competitive advantage.

Facebook did not want any other bidder (probably Google) to get Instagram, so it forced the transaction with the retro-styled photo-sharing software business to be put on hold.

• It wants to update its mobile applications.

Instagram is a very popular mobile app, while Facebook’s mobile applications aren’t as popular. Facebook, it appears, sought to capitalize on Instagram’s growing popularity by incorporating it into its own mobile applications.

• It desired to infuse the air with a sense of freshness.

Facebook is a few years old, and according to certain sources, it is no longer cool. At the time of the purchase, Instagram had 30 million registered users. Facebook intended to inject the freshness of these people into the popular social network and give it a new appeal.

• It desired to provide users with fresh options.

Traditionally, Facebook has been used to view other people’s images. And the corporation was in dire need of an image makeover. All Facebook users may now apply a variety of unique filters to their images in order to provide the finest picture sharing experience. “We felt it would be worth bringing these two companies together since providing the finest photo sharing experience is one of the reasons why so many people enjoy Facebook,” stated CEO Mark Zuckerberg.

• For mobile advertisements, it wants to target people with precise information.

A foodie is more likely to share photos of food, whereas a swimmer is more likely to share photos of the pool and his or her swimming adventures. Instagram was very particular about its user information, but Facebook was not. Facebook need the precise user information in order to improve its database and maybe exploit it for mobile advertising.

• It wants to be authentic.

Facebook had gathered enormous money and millions of users over the years. According to experts, Instagram allowed users to share real-time experiences, and Facebook wanted to be more transparent with its users. That is one of the reasons why many original Instagram users are still struggling to accept the reality that it has been sold. Visit more information, visit https://buybettersocial.com/.

• It desired to provide users with a nostalgic experience.

Instagram was founded with the idea of giving users with a nostalgic experience. While Facebook was far behind Instagram, it chose to purchase the app’s creator rather than invest in a competitor.

Experts and analysts from all around the globe will be watching Facebook attentively to see how it manages its company with Instagram, after all, it paid a lot of money to acquire the latter.

Advertisement

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s