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by koosa 4483 days ago
Immediately after striking Facebook-WattsApp deal, Koum had mentioned in one of his tweets that users' privacy and security is their top concern and I hope he sticks to his guns.
3 comments

He wouldn't have sold to Facebook if users' privacy and security was his top concern. Money was likely his top concern.
He wouldn't exactly go out and tell people he just sold all their messages and address books, though, would he?

The message he wrote, was a message he had to write to keep customers using WhatsApp

Indeed. They may negotiate some privacy agreement in the sale (that is, fb and the feds), but that agreement will likely expire in due course, as it becomes a 'burden' to the business.
He just sold WhatsApp to a company that he has no control over. His word is no good over this decision.
He's joining the Board of Directors, so he does have much more control than most.
Sure he'll get a chair but that's where it stops. FB, the company is about targeted advertisements based on your profile, activity etc. There's no reason why they won't do that with Whatsapp. They have most definitely not paid $19 billion to get only 99 cent revenue every year. They perhaps are eyeing for much more per user.
With over 400 million active monthly users, that would be much closer to $399,000,000 than $0.99 every year.

WhatsApp has nearly twice the active users as Twitter, and many more than Skype, LinkedIn, Instagram, and even Angry Birds.

Not only that, WhatsApp has a user:employee ratio of over 8,000,000:1. That is quite remarkable, over 8x the users per employee than Youtube.

There is much more value in WhatsApp for FB than just eyeballs.

One element of corporate strategy is that there is strategic value not simply in having [acquired company X] but also having kept it out of competitors' hands.

Facebook owning it means Google, Apple, Microsoft etc don't. Facebook likes that.

Wouldn't that be, to some extent, a conflict of interest? Given that the other shareholders who have paid for WhatsApp want to get a return on their investment, the Board Member who has benefited from the sale is blocking existing shareholders from benefiting from such acquisition.

Lets remember that as a board member he has a fiduciary duty to FBs shareholders, and that means making sound ($) decisions.

Well Jan could argue that it would cause a user exodus which would then reduce the value of WhatsApp (thus facebook) more than the added revenue would increase it.

I'm not saying that he would. Or that he could convince enough of the Board that this is the case. But he could.

That is a good argument. I guess all of this depends on the numbers. What's better in absolute terms?: Exodus of users with immediate positive ROI or user privacy with potential $ in the future. Lets see how it pans out.