Quick Update- Facebook purchase Instagram

Facebook has recently made a perplexing decision of purchasing Instagram, a photo sharing app, worth $1 billion. Let’s study apart from the big brand name what else made Facebook to take this rash decision.

Number of Users- Lets gets the number straight; Instagram is a huge brand name with 30 million users that is expected to increase due to the fact that this app has been recently added on the Android platform. The users are expected to reach to 100 million. Although, it’s an impressive figure, but it is a dwarfed figure, as Facebook has 850 million users, and now the next big task for Facebook would be to attract 100 million users. Moreover, it wants to translate its user base into an earning; if you are unable to do that, then it won’t matter whether you have 850 million customers or 950 million customers.

 Presence on Mobile- Another reason for purchase of Instagram is huge presence on the mobile domain. But the major problem is that Facebook wants to keep more people coming from the PC, as they will show some adverts, which in turn would help them in making money. While, the same is not possible with mobile apps and the future remains dodgy.

To combat the possible threat- Facebook wanted to combat the potential threat that may shake it from the roots. But, the prosaic reality is the photo sharing apps have become so common that Instagram in itself doesn’t seem like a potential threat.

Data Accumulation- Some people may argue that Instagram will bring a lot of new personal data and geo tagged images, but there is a big but to it.

Instagram contribution to Facebook is miniscule in comparison to the investment made.

Although, you may call it a rash decision, yet through it Facebook will be able to prevent its competitors from surging up. Another great perk will be Facebook will be able to gain from Instagram skilled engineers that can assist in developing mobile interface. But even then we can’t call it a smartest decision made by Facebook. Let the time dawn upon and provide answer to this question.


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