Mark Zuckerberg: $19 Billion for WhatsApp Is Cheap!


Visitors attend Mobile World Congress, the world's largest mobile phone trade show, in Barcelona, Spain. Manu Fernandez / AP

Facebook is buying WhatsApp in a deal worth up to a jaw-dropping $19 billion — but Mark Zuckerberg thinks he scored the messaging service for cheap.

"I think that by itself, [WhatsApp is] worth more than $19 billion," Facebook CEO Zuckerberg said Monday, during a keynote address at the Mobile World Congress conference in Barcelona. The messaging service, which transmits users' text and video messages via their Internet data plan, is especially popular with young and overseas users.

What's more, Zuckerberg explained, WhatsApp's offers value not only as standalone company but also as part of Facebook's larger strategy.

He called WhatsApp the "most engaging app that we've ever seen exist on mobile by far," and pointed out "there are very few services that reach one billion in the world." Rival services like China's WeChat have been able to make about $2 per user, Zuckerberg said.

Still, echoing last week's announcement of the deal, Zuckerberg said he won't push WhatsApp to make money anytime soon. Instead the buyout makes it possible for WhatsApp to "focus for the next five years purely on connecting people."

In response to a question from a journalist in the audience, Zuckerberg also promised Facebook won't mess with WhatsApp's data policy, in which the company does not store the content of messages.

"That's absolutely not going to change," Zuckerberg said, adding later: "We'd be pretty silly to get in the way of it."

But Zuckerberg didn't say much more about WhatsApp (which, if it passes regulatory approval, will be by far his company's largest acquisition).

Instead Zuckerberg stayed firmly on the topic of, a Facebook-led initiative to bring Internet connectivity to the two-thirds of the world's population that currently lacks access. Facebook launched the project last summer with companies including Samsung, Nokia and Qualcomm.

Zuckerberg called the initiative "an on-ramp to the Internet" and talked up a new project announced Tuesday: SocialEDU, a pilot program that will provide students in Rwanda with free access to an online education system.

When the conversation moved to a question-and-answer session, however, the talk quickly went back to WhatsApp and Facebook's acquisition strategy.

An audience member asked if Facebook will try once again to buy Snapchat, the photo-messaging service that reportedly spurned a $3 billion offer last year.

Zuckerberg sat mute, and when the moderator asked him whether he had any comment, he replied simply: "No." The crowd laughed.

"After buying a company for $16 billion, you're probably done for a while," Zuckerberg added. (The $19 billion deal includes $3 billion in restricted Facebook stock to be paid to WhatsApp employees who remain at the company for four years, so both $16 billion and $19 billion have been cited as the purchase price.)

Zuckerberg also sounded off about the National Security Agency, saying Edward Snowden's reveal of the Prism snooping program served to align former rivals in the tech space. In fact, they're "working together better than ever before," he said.

"The government kind of blew it on this," Zuckerberg said. "They were way over the line in not being transparent about what they're doing ... Now they're getting there, but they're only now starting to get to the point where they should have been before."

Zuckerberg's overall take on the NSA's doings? "It's not awesome."