How WhatsApp earns Money?

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                        WhatsApp is a messaging platform that billions of people use to communicate with one another around the world. WhatsApp is the dominant forerunner in its field, with minimal competitors. WhatsApp was founded in 2009 by Brian Acton and Jan Koum and quickly gained a following because, at the time, BlackBerry had a messaging app, but it was only accessible to BlackBerry users, whereas WhatsApp is available to anyone with internet access. Because messaging over standard networks was expensive, people began to use the application.


            But, given that the app is free, how does WhatsApp make money? Brian Acton, the founder of WhatsApp, was very keen on not having games and advertisements in the application and wanted it to function as a simple messaging application with the main goal of maintaining the application's privacy. Initially, many investors came forward to support the start-up, but WhatsApp found it difficult to maintain the cost of handling because they had to send some messages during verification. To address the issue, they provided an annual subscription offer of access to the application for a one-time fee of one dollar. The model was successful because it was less expensive than other messaging applications.


 In places like India, where the majority of people are from the middle and lower classes and do not have access to credit cards, the model did not work well. WhatsApp made its application free again in 2016 to increase its user base, and by this time the company was owned by Mark Zuckerberg, the founder of Facebook. With the application becoming free and the absence of advertisements, WhatsApp's revenue fell, and Mark Zuckerberg decided to revamp the business model in order to increase revenue. He introduced the business account feature, in which businesses can use the WhatsApp API to quickly respond to a user's query, as user accountability is critical for every business.
 Singapore Airlines, Booking.com, Uber, and Make My Trip are some of the early adopters who are using the application to respond to their users. Unlike earlier traditional systems, these businesses find it simple to use the API because customer queries are quickly responded to, validated, and reported to customer care. In April 2020, Facebook also purchased Jio Mart to use WhatsApp as an interface to conduct business and commerce and went one step further by introducing WhatsApp Pay to make the website a complete eCommerce platform. However, WhatsApp Pay did not work well in India because there were other UPIs that offered free transactions, whereas WhatsApp offered a 3% interest rate on business accounts.
 The founders of WhatsApp and Mark Zuckerberg disagreed on privacy policies because Facebook's business model is based on selling data. They left the company because they felt their data's privacy had been compromised. Brian also formed a non-profit entity and a messenger application called Signal, which offers its services for free while also protecting privacy. Going back to WhatsApp's business model for generating revenue, it is expected that in the future, they will include advertisements in between status updates to generate revenue. What are your thoughts on advertisements, as this was a core principle that WhatsApp's founder refuted to, and what are your thoughts on the application's privacy?

 

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