California: As of 2024, WhatsApp has around three billion users globally, making it one of the most popular messaging programs for both personal and professional use.
The software, which is still free and has features that increase its appeal worldwide, is hosted on robust servers spread across several data centers.
Maintaining such a large organization is not cheap, even though its concept is free for users. However, how is revenue generated from this free app?
The fact that Mark Zuckerberg’s Meta, the tech behemoth that also owns Facebook and Instagram, is the owner of WhatsApp is helpful, but it’s not all.
The BBC says its corporate clients have the answer.
WhatsApp makes money from its platform by offering services designed for companies that want to communicate with customers via their free personal accounts.
Companies have been able to send out messages to anyone who chooses to subscribe to the channel by creating free WhatsApp channels since last year.
Companies get access to each transactional and conversational engagement with specific clients through the app for a premium.
For example, in Bangalore, India, customers can purchase a bus ticket and select their seats via WhatsApp.
Nikila Srinivasan, vice president of business messaging at Meta, stated, “Our vision, if we get all of this right, is a business, and a customer should be able to get things done right in a chat thread.”
“That means, if you want to book a ticket, if you want to initiate a return, if you want to make a payment, you should be able to do that without ever leaving your chat thread. And then just go right back to all of the other conversations in your life.”
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It is now possible for companies to pay for a link that opens a new WhatsApp chat directly from a social media online ad to a personal account.
It is alone now worth “several billions of dollars,” the IT behemoth Srinivasan said.
Matthew Hodgson, a co-founder of the UK-based company Element, thinks that the most widely used income model for messaging apps is still advertising.
Hodgson said, “Basically [many messaging platforms] sell ads by monitoring what people do, who they talk to, and then targeting them with the best ads.”
The notion is that the applications may learn a lot about their users without seeing the actual content of the messages being shared, even if encryption and anonymity are in place, Hodgson explained.
After that, they can sell advertisements using that data.
He added, “It’s the old story; if you, the user, aren’t paying, then the chances are that you are the product.”