Whatsthat? Facebook starts to monetize WhatsApp!

Whatsthat? Facebook starts to monetize WhatsApp!

Last week, it was announced that WhatsApp, the Facebook-owned messaging app, is currently testing a new tool to enable businesses to talk directly to customers on the platform.

As Reuters reports, the popular messaging app (which is used by over 1 billion users worldwide) hasn’t created a business model since Facebook Inc purchased it for a total of $19 billion in 2014. However, this system could provide WhatsApp with a potential revenue source by offering them the opportunity to charge companies to contact users.

Despite announcing plans to launch this service last year, it’s only now that tests are being conducted with businesses that are a part of the Y Combinator standup incubator, an American seed accelerator that offers training and advice to startups. This follows a deal struck by the two companies last month for a handful of businesses to take part in an early trial of the system.

This is according to emails and messages shared on a Y Combinator forum, explains Reuters.

Although WhatsApp cited users speaking to banks about fraudulent activity as an example of how the new system could be used, one of their primary concerns is spam messages. To combat this, WhatsApp are currently surveying users to determine how often they use the platform to talk to businesses, and whether they have received spam as a result.

As Reuters reports, a WhatsApp spokesperson has declined to comment on the system’s testing, while Y Combinator President, Sam Altman, says he wasn’t aware of it. However, he added: “we do generally see a lot of companies wanting to test their products with YC cos.”

Nonetheless, Umer Ilyas, the co-founder of Cowlar Inc (one of the companies involved in the testing), confirmed that the trail is still in its early stages.

The TJM take: Though we’ve been expecting Facebook to monetize WhatsApp, we’re concerned that this model may not be the most effective.

Although allowing businesses to talk to customers through the app is great for customer service (which is something the likes of Twitter and Instagram are already taking advantage of), many users turn to WhatsApp to ‘text’ their friends and family without the costs that are typically involved with standard texting.

Although spam shouldn’t be a big issue, are these users going to feel comfortable being contacted by brands through what is essentially seen as a text messaging service?

*Image source: Reuters

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