Facebook has money. Ok, Facebook has a lot of money. It will have boat loads of cash for a very long time. The stock has gone up 100% from its IPO. What does a company do with all that cash? Well, if you are Google you buy pro companies that will help your operation system flourish or help you enter new markets for search. If you are Apple you sit on if for what seems like forever. If you are Microsoft you use your war chest to help you stay relevant in a post desktop world. Facebook on the on the other hand is on a spending spree. What they are buying does not seem to make any sense. They paid a lot for Instagram which made sense you it wanted to put ads on their fine. It paid for $16 Billion for WhatsApp which was way too much. However, we understand, you wanted to get a foothold in foreign markets. We get it. However, buying Oculus VR for $2 billion? yes, the Oculus VR is the future of virtual reality but is it worth $2 billion? Facebook’s plans for the VR headset aren’t clear to anyone. Maybe they will make the go to product for watching TV or movies. Maybe Mark’s vision comes true and people use the device for watching sports. The social media giant’s announcement didn’t help clear up any of those ideas.
But this is just the start. After games, we’re going to make Oculus a platform for many other experiences. Imagine enjoying a court side seat at a game, studying in a classroom of students and teachers all over the world or consulting with a doctor face-to-face — just by putting on goggles in your home.
This is really a new communication platform. By feeling truly present, you can share unbounded spaces and experiences with the people in your life. Imagine sharing not just moments with your friends online, but entire experiences and adventures. ~Mark Zuckerberg
WhatsApp is on a path to connect 1 billion people. The services that reach that milestone are all incredibly valuable. I’ve known Jan [Koum, WhatsApp cofounder] for a long time and I’m excited to partner with him and his team to make the world more open and connected. ~Mark Zuckerberg
WhatsApp posed a threat to Facebook’s business just like Instagram did. The app is an alternative to SMS. What is does is send messages for free regardless of the device you are using. You may not have used WhatsApp but you sure have heard of it. The app is very popular abroad. Facebook will pay $12 billion in stock and $4 billion in cash for WhatsApp. As a bonus, Facebook will also give an extra $3 billion in restricted stock units to WhatsApp’s founders and employees as part of the deal. That brings the total of the deal to which would bring the total deal $19 billion. The popular messaging app has close to a billion users. This only a messaging app people! $19 billion? Facebook is basically paying billions for AOL Instant Messenger. They are now about to pay Billions for what could turn out to be the next Nintendo VirtualBoy.