Twitters reacted negatively for Facebook concluding the deal with Instagram.
Is the deal worth $1 Billion for an application?
I am doubtful.
Sometimes.deliberated decisions in Business do not pay off, but gut feelings do.
Mark Zuckerberg might prove to be right other wise he might not be where he is today
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Facebook boss Mark Zuckerberg choose to spend $1bn on Instagram, a small web start-up just under two years old, with 13 full-time staff who work on a single smartphone app.
The business model
Yes, Instagram is very popular. The app’s fancy “filters” give your photos a lovely vintage feeling, a bit like the faded Polaroids tucked away in the drawers of your parents’ living room. They port mediocre photos into an alternate universe where they look kind of good; an online service allows users to share their pictures with friends.
The drawback, of course, is Instagram’s business model. The company has no revenue to speak of. Maybe its business model was to be bought by another tech firm with too much money in the bank.
So is this the return of silly money to Silicon Valley? Is it a case of panic buying, with valuations pushed up in a bidding war with Google or another competitor?
Facebook is certainly not spending $1bn on an app.
Rather, it is buying three things: a potential rival with a rapidly growing user base; a weapon to fight other even bigger threats in the social networking space; and most importantly a better hook into the world of mobile computing.
http://www.bbc.co.uk/news/business-17666032
I would like to see Facebook users response.
“And now Facebook has announced it’s buying the super popular photo-sharing app and social network for $1 billion.
As @HmSeb put it on Twitter, Instagram is in a relationship now, and it’s complicated.
And, as with any new relationship, there is no shortage of opinion and overreaction. Here’s a sampling of the unfiltered hyperbole:
“Instagram just officially died today,” wrote @AmirKassaei .
“I liked instagram before they sold out,” wrote @EAJosh .
Not everyone was turned off. Some said they might now reconsider. “I might install @instagram now that all the whiny hipsters are leaving,” wrote @commagere . And @benjaminjackson had a good point: “At least you can look forward to your mother being on Instagram soon.” Lovely.
Springing up are tweets and tips on how to break camp and pull out your content and links to delete your account altogether. But take a minute before clicking that link and maybe use more caution about leaving than you do about what you shoot or what filter to use. Facebook has said it plans to leave Instagram independent.
One man on the cyberstreet suggested this could actually solve a cultural quandary. Assuming the voice of Facebook, @DavidSlack tweeted that maybe job applicants won’t need to worry about those embarrassing pictures on Facebook anymore: “We’re buying Instagram to ensure photos of our era are blurred enough that no-one in the future can identify the stupidest people in history.”Additional input received from Maduhr Gupta is here below.
“In updated s1 Facebook reveals that it agreed to pay $1 billion for the photo-sharing site Instragram consists of $300 million in cash and about 23 million shares of the company’s common stock. The company also noted that it agreed to pay Instragram(photo sharing sites) a $200 million termination fee in the event the deal for some reason is not completed. for more logon to’
http://mytechmafia.com/facebook-s-instagram-deal-300m-paying-in-cash-23m-shares-for-instagram/
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