The news of Facebook’s acquisition of WhatsApp for $19b+ crystallized some thoughts I’ve had on mobile messaging platforms like WhatsApp and BBM, and previously desktop messaging platforms like MSN Messenger and AOL Instant Messenger.
The $19b+ WhatApp purchase price was apparently justified by the high number of active users on the platform (some high percentage of the 450mm registered users). There is however a big difference between an active user on a social network like Facebook and an active user on a messaging platform like WhatsApp. Both require you to construct a social network of your friends and associates (with all agreeing to use the same platform – no small feat in the early days). The difference however lies in what and how content is shared within that network. Unlike in Facebook where content is usually long lasting (eg. has a long half-life) and is by default shared across everyone in your social network (and often their social networks too), messaging platforms are usually sharing very short-lived content and usually only between two people.
That means that when there’s a problem (like there was yesterday with WhatsApp system-wide downtime) users can very quickly move to alternatives to address their immediate point-to-point communication requirement. Users don’t have to worry about content they’ve left behind (half-life value of a conversation between users is in the minutes), and likely have multiple ways to reach the other person in the point-to-point conversation.
So without long-lived broadly shared content tied up in the messaging platform, and with the relative ease of setting up alternative point-to-point communication paths to people in your network, the lock-in of a messaging platform is relatively low, despite the fact that there is substantial network effect. Hence the rise and fall of several messaging platforms that had all achieved broad acceptance in their time (AOL IM, MSN Messenger, BBM).
It will be interesting to see how WhatsApp evolves (will they leverage a users Facebook content and social networks to increase lock-in) and if they can avoid the same challenges as messaging platforms that cam before them.