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Messy Facebook/WhatsApp split shows revenue strategy clash

Published 06/05/2018, 12:07 PM
© Reuters.  Messy Facebook/WhatsApp split shows revenue strategy clash
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  • The ongoing messy split between the founders of WhatsApp and the app's high-profile parent, Facebook (FB -0.1%), points to an important internal debate over strategy, a new WSJ piece notes.
  • WhatsApp creators Jan Koum and Brian Acton are leaving about $1.3B on the table in walking away from the social-networking giant, and that follows persistent disagreement over strategy and returns on Facebook's $22B purchase of the messaging service, by far its largest acquisition.
  • Chiefly, that involves a dispute over data privacy and getting more revenues out of targeted ads long opposed by WhatsApp founders. Acton and Koum wanted to pursue some non-advertising methods of generating revenue, while Facebook execs pointed to Instagram as a more lucrative ad-based model.
  • Acton and Koum left without loud disagreement, hoping to preserve their relationship with Facebook CEO Mark Zuckerberg, but had concluded they were fighting a losing battle in a "very passive-aggressive" environment, the report says.
  • Acton forfeited about $900M in stock when leaving last fall; if Koum departs mid-August as expected, he'll leave behind $400M in unvested shares. Each would have gotten all remaining shares if they had stayed until this November.
  • Now read: Facebook's 200-Day MA Is The Last Hope For Bears


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