Last week it was announced that Facebook had forked out a massive $1bn to buy popular photo-sharing app, Instagram. What does this mean for the future of the app and why were Facebook willing to pay so much for it?
Having only appeared on the app scene in October 2010, Instagram’s popularity has grown incredibly rapidly; just 2 months after its launch the app boasted 1 million registered users and figures in April 2012 showed 30 million users. The fortune that Facebook paid to own this popular app will be split between its 26-year-old CEO, Kevin Systrom, and co-founder, Mike Krieger, with Krieger received $100 million and Systrom bagging a whopping $400 million! A remaining 10% ($100 million) is due to be shared between Instagram’s 13 lucky employees.
Prior to being bought by Facebook, Instagram was valued at $500 million, but judging by their increasing popularity, and the release of an Android app, Instagram was definitely set to grow even more in value.
Instagram is a fun and creative way to share your photos on a daily basis, as well as edit them, and it is this that made the app so valuable to Facebook. Although Facebook users already upload a huge amount of photos, with CEO Mark Zuckerberg stating that “for years, (Facebook has) focused on building the best experience for sharing photos with your friends and family”, it is by no means the best photo uploading service on the web. By purchasing Instagram Facebook are bettering their own photo sharing options as well as buying out the competition.
So, what does this all mean for the future of Instagram? Zuckerberg has said that he aims to build upon the original strengths and features that Instagram has, indicating no planned changes, but with talk of a desktop application already, should we expect big changes?
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