Science and Technology Desk: WhatsApp is one of the most popular messaging platforms in the world owned by Meta. Messages, pictures, videos, files are constantly being exchanged on WhatsApp. More than three billion people are using this platform every day. Personal as well as urgent office conversations are now on WhatsApp. All messages are end-to-end encrypted on this platform. As a result, this platform can be used safely. But despite all these benefits, the app can be used for free. It also doesn't show any ads directly. Then how the owner company Meta earns through WhatsApp - it is natural to ask the question.
WhatsApp has about 3 billion users worldwide. The powerful computer servers of the platform are housed in various data centers around the world. They require a huge amount of money to run. But WhatsApp does not take money directly from users.
Meta, the parent company of WhatsApp, allows users to use private WhatsApp accounts for free. WhatsApp mainly earns money from big companies. Companies use WhatsApp to promote products or services or communicate with customers.
Since last year, companies have been able to create channels on WhatsApp for free. A channel can only send messages to all subscribers. However, by purchasing the premium version of WhatsApp, companies can chat directly with customers, answer questions, discuss products or services. Can even complete the transaction or sale process. Eg: A bus ticket can be purchased to travel from UK to any city in India.
Nikila Srinivasan, vice president of Matter Business Messaging, said the company's goal is to enable businesses and consumers to do everything right in chat threads. He drew an example to illustrate the point. Srinivasan said WhatsApp is trying to make everything from payment of a ticket to refund process done through chat threads.
Businesses can pay WhatsApp for a link. Tapping these links in Facebook or Instagram online ads initiates a new WhatsApp chat in the user's personal account. And from this one service Meta earns billions of dollars. This is extremely profitable for the meta.
But other messaging services take a different approach. Another popular platform for security and privacy is 'Signal'. It is a non-profit organization. The company claims that the platform has never taken money from investors.
Signal operates through various grants. In 2018, Telegram raised $50 million in funding from one of WhatsApp's co-founders, Byrne Acton.
Discord is a popular messaging app among young gamers. It is free to sign up and use various features of the app for free. However, certain features such as access to a game require spending money on Discord. It also has a 'Paid Membership' called 'Nitro'. Users have to spend $9.99 per month to get this membership.
Snapchat also has various such paid models. Advertisements are also displayed on the platform. Snapchat currently has 1.1 million paid subscribers (as of August 2024). Apart from this, the company also sells augmented reality (AR) glasses called Snapchat Spectacles.
According to the Forbes website, from 2016 to 2023, it earned nearly $300 million from interest alone. However, Snapchat's main source of revenue is advertising. Snapchat makes more than $4 billion a year through advertising.
UK based company 'Element' also offers secure messaging facilities. The company takes money from the government and large corporations to use this system.
The most popular business model for messaging apps is still digital advertising, said company co-founder Matthew Hodson. Many messaging platforms monitor what people are doing, who they are talking to, and then show them the most relevant ads.
While messaging services have encryption and privacy features, technology companies can learn a lot about users. This does not require viewing the main content of the message. Sells various user data to advertisers.
Matthew Hodson says, "If you're not paying a platform as a user, chances are you're the product."
Source: BBC
