As it was expected, Facebook is getting ready to make some money out of its Messenger platform, setting the stage with “Businesses on Messenger.”
A little over 700 million are now on Facebook Messenger, using it to keep in touch with friends, family – rendering the traditional text messaging almost useless. Ever since Facebook transformed its communication service into a platform of its own, it has rapidly gained even more users at an incredibly fast pace.
If WhatsApp and Messenger were not owned by the same company, they would be each other’s worst rivals, as Messenger is approaching the size of WhatsApp, which now boast over 800 million users. WhatsApp was purchased in 2014 for $22 billion, but its growth is slightly slower that Messenger’s.
With Facebook’s market value currently estimated at $250 billion, both messaging platforms account for approximately 10 percent of that. Messenger, however, seems to be favored by regional demographics when it comes to the possibility of becoming a serious source of revenue for the tech giant.
For once, Messenger users are – for now – still required to have a Facebook account, with only a few recent exceptions. Because of this, Facebook knows a lot more about Messenger users than it knows about those on WhatsApp, which will be of great value as more businesses will flood the Messenger with their marketing presence.
But even before that happens, Facebook is still benefitting directly from its Messenger users. In spite of the secure end-to-end encryption that doesn’t allow Facebook to see what you’re talking over its app, the company is transparent about collecting data about where you are and who you’re messaging with.
In the end, this information is critical for its ad-targeting algorithms which determine exactly the content and advertisements that pop up in your News Feed and anywhere on Facebook. The end result is offering a better user experience, but also gaining higher-priced ads.
Ever since Messenger was turned into a platform standing on its two own feet, Facebook has opened it to developers, who can now offer input and create apps or games inside the app. All of this will eventually produce revenue for Facebook, especially in combo with its mobile payment service.
On the other hand, WhatsApp’s only current form of revenue is a $0.99 annual charge that most users don’t even pay. According to their policy, the first year is free – which is why, at the mark of 400 million active users, WhatsApp had only generated slightly over $10 million in revenue.
Image Source: Softonic
