Facebook and whatsapp article

Publicly Traded Company, Advantages Of Internet, Brazil, Net

Excerpt coming from Essay:

Internet analysis a publicly traded company Usa undergone a merger obtain (3) years. Take note situations surrounding merger acquisition. Set a (4-6) web page paper: 1 ) Examine conditions resulted combination acquisition picked company.

In February 2014, Facebook released the conclusion of your deal to purchase leading messages service WhatsApp, in a package worth $19 billion, with $4 billion dollars in cash (CNBC, 2014). The deal is known as one of the biggest in the IT sector, rivaling the acquisition of Compaq by HORSEPOWER, for example. It is additionally Facebook’s biggest acquisition as of yet. Given the cost of the acquisition and the fact that the obtained company is actually new (it has been detailed for about five years) and employs simply around 55 people (Panzarino, 2013), questions about the motivation lurking behind the deal are obvious.

There are many reasons that motivated the acquisition. Initially, as Hartung (2014) stated, success on the market is closely linked to preserving relevancy. What this means is that a company should continuously keep in contact the changes and developments on the market, particularly in terms of customer preference. It needs to innovate and propose fresh service to meet these consumer requirements. At times, it simply cannot do this entirely internally.

For instance , Facebook understood the need to transform its social network platform and make this more tailored to mobile phones, as the industry required. This kind of also intended creating instantaneous messaging services, which in turn it did, but not as successfully as WhatsApp. That made more sense to acquire a company that was already set up in this market and that a new large number of customers.

This backlinks well to the second cause of the combination: what Fb acquired. Other than a relatively low number of workers (the price paid arrived at $550 mil per engineer, as Panzarino (2013) showed)), it brought 350 mil established users and, even more importantly, a major international presence, supporting Facebook reach into the Western market, and into appearing markets (Constine, 2014). Furthermore, WhatsApp’s owner and CEO, Jan Koum, will become a member of the plank of owners at Facebook or myspace, bringing along his expertise and expertise.

While it is actually difficult to assess the effects immediately, since the bottom line of the package is so new, one can correctly discuss and understand the positive effects of the deal, particularly searching at the reasons for the deal, because previously reviewed. First of all, Facebook, through WhatsApp, will increase its presence inside the instant messaging industry of expanding countries, as well as on the Euro market.

Constine (2014) pulls a map of the world, while using type of mobile messaging employed in different locations. It obviously shows a competitive benefits for WhatsApp, as compared to the Facebook messages application, in lots of European countries. For example , the percentage of WhatsApp users, as compared to the Facebook messaging support, is 31 to 15% in Ireland in europe, 83 to 12% in the Netherlands and 84 to 31% in Germany. Following the acquisition, these types of figures will be added with each other, so Facebook, through WhatsApp and its personal service, will clearly dominate the Western market.

This is also the case with a few of the significant developing market segments, such as Brazil or Chinese suppliers. In China and tiawan, for example , an evident emerging and growing industry, 11% employ WhatsApp, as the Facebook messages service contains a 2% charge. In Brazil, the scores are 71 to 34% in WhatsApp’s favor. Again, in all of the these market segments, the statistics will now be added in Facebook’s benefit. It is important to also which WhatsApp adds about a , 000, 000 new users a day, which will gains relevance in markets that still have a large potential to develop.

Therefore , the 1st positive result is the increase in the number of users. The second great effect comes from

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