WhatsApp is dropping its subscription fees to access the popular messaging service, as it looks to explore new funding options, such as tie-ins with other companies. The chat app, famously bought by Facebook for a massive $19bn in 2014, is ditching the 99 cent annual charge for the service. WhatsApp founder Jan Koum said the […]
WhatsApp is dropping its subscription fees to access the popular messaging service, as it looks to explore new funding options, such as tie-ins with other companies.
The chat app, famously bought by Facebook for a massive $19bn in 2014, is ditching the 99 cent annual charge for the service.
WhatsApp founder Jan Koum said the move signals an effort to remove the barriers some users faced in using the service.
“It really doesn’t work that well,” Koum said Monday, speaking at the DLD conference in Munich. He noted that while a buck a year might not sound like much, access to credit cards is not ubiquitous. “We just don’t want people to think at some point their communication to the world will be cut off.”
Until now WhatsApp has been free for the first year and 99 cents for additional years.
As far as a new business model, WhatsApp says it will explore ways businesses can use the service to connect with individuals, but said the goal is to avoid spam and unwanted advertising.
The Facebook-owned service plans appears to be planning to generate revenue through services to businesses.
“We will test tools that allow you to use WhatsApp to communicate with businesses and organizations that you want to hear from.”
That means you might be able to send WhatsApp messages to your bank or airlines in the future. WhatsApp isn’t planning to enable third-party ads within the service, and it’s sticking to its original principles.
The founders of WhatsApp were strongly opposed to ads, noting back in 2012 that “when advertising is involved you the user are the product.”
The company blog post reads:
Naturally, people might wonder how we plan to keep WhatsApp running without subscription fees and if today’s announcement means we’re introducing third-party ads. The answer is no. Starting this year, we will test tools that allow you to use WhatsApp to communicate with businesses and organizations that you want to hear from. That could mean communicating with your bank about whether a recent transaction was fraudulent, or with an airline about a delayed flight. We all get these messages elsewhere today – through text messages and phone calls – so we want to test new tools to make this easier to do on WhatsApp, while still giving you an experience without third-party ads and spam.
This strategy is the same idea behind Facebook Messenger, the company’s other standalone messaging service.
With Messenger, Facebook already offers users the chance to chat with businesses, and it’s building out other features, like payments or the ability to hail a ride through Uber.
WhatsApp now has nearly 1 billion users, so the free timing removes the barrier for millions more to join the messaging service.
