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What's the deal with WhatsApp?: CNET Update

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CNET Update: What's the deal with WhatsApp?

2:56 /

Facebook dominates the mobile messaging world with its $19 billion acquisition of WhatsApp. CNET's Bridget Carey explains the value of the app, along with news about the Xbox One and a high-tech toothbrush.

-Facebook wants to be king of the text message. I'm Bridget Carey and this is your CNET update. When Facebook agreed to purchase Whatsapp for $19 billion, most people were asking "what's Whatsapp." Well, put simply, it's a private messaging app that's massively popular around the world and people use it instead of sending regular SMS text messages. Whatsapp has 450 million monthly active users. That's almost double the monthly active users of Twitter. It's not as popular in America. Most folks in the U.S. don't bother with using a separate app for text messages because many wireless plans include unlimited texting, but in other countries, texting can be costly especially if you're testing friends and family living abroad. Whatsapp gets around the texting fees because it uses a data connection. It's free for the first 12 months and only a dollar a year after that. So, you might ask how is Whatsapp worth $19 billion to Facebook. It is a shocking amount of money, but you can argue it was a good deal. Let's break it down. Each day, Whatsapp has 1 million new members signing up. It won't be long before it hits a billion users. With every member paying 1-dollar annual subscription fees, Facebook now is bringing in major revenue. Right now, more than 18 billion messages are sent a day on Whatsapp. That includes texts, and videos, and photos, but that's close to the same amount of regular SMS messages that are sent around the world each day from all the cellular companies combined. This is becoming the more popular way to text. Whatsapp has a larger and faster growing user base than Twitter. So, if Whatsapp is growing more than Twitter and Twitter's worth $30 billion, then Mark Zuckerberg got a good deal for paying $19 billion. When you look at how often people use the app, they use it more than Facebook. About 70 percent of Whatsapp users are engaging with the app each day compared to Facebook's 61 percent engagement. This was Facebook's biggest mobile challenger, but not anymore. In gadget news, Xbox one owners will soon be able to buy a media remote for the console. Microsoft announced the Xbox One media remote will hit stores in early March for $25. And if you wanted more tech in your toothbrush, Oral-B announced a new smart series electric toothbrush that sends data to your smartphone using Bluetooth. Yes, a Bluetooth toothbrush. It tracks how well you're brushing and reports back on an app. It will be $300 when it goes on sale later this year. That's your tech news update, but you can find more details at cnet.com/update and you could always keep up with the latest stories by following along on Twitter. From our studios in New York, I'm Bridget Carey.
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