Facebook Spends $19 Billion to Buy Messaging Service
Justin Sullivan/Getty Images(MENLO PARK, Calif.) — Facebook announced on Wednesday it is spending $19 billion to purchase the text messaging service WhatsApp.
Facebook says it will pay $4 billion in cash and $12 billion in stock for the service.
WhatsApp allows users to send texts to friends over the Internet, thus avoiding pricy mobile carrier fees.
Engadget Managing Editor Dana Wollman tells ABC News that while WhatsApp is not yet popular in the U.S., globally it has about 450 million active users. The company is reportedly adding more than one million new users a day.
WhatsApp has only 55 employees, which means the deal is worth about $345 million per employee.
“WhatsApp is on a path to connect one billion people. The services that reach that milestone are all incredibly valuable,” Facebook CEO Mark Zuckerberg said in a statement.
Industry observers note that WhatsApp is part of a new breed of mobile messaging apps that are becoming the main way smartphone users communicate with each other.
Copyright 2014 ABC News Radio
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