WhatsApp Ditches $1 Subscription Fee: Unveils Future Profit Strategies

Facebook-owned instant messaging giant, WhatsApp, has decided to scrap the annual $1 subscription fee, effectively becoming a free platform. This change was implemented yesterday, according to CEO Jan Koum, bringing an end to the nominal annual charge. In an elucidative [blog post](https://blog.whatsapp.com/615/Making-WhatsApp-free-and-more-useful), the company reassured users worldwide that the next revenue generation strategy will not involve spamming them with unsolicited advertisements.

WhatsApp, currently on the verge of reaching the landmark one billion user mark, seems to be steering in a direction similar to its parent company’s messenger service. The strategy to prioritize the expansion and enrichment of the user base before rolling out business-oriented features is a long-established part of Facebook’s successful business model.


*WhatsApp’s significant growth over the years (Source: Business Insider)*

The million-dollar question now is – how does WhatsApp plan to monetize its massive user count? The answer may lie in the words of Facebook CEO Mark Zuckerberg who quipped, “What we decided was that over the long term, the ads and monetization would perform better if there was an organic interaction between people using the product and businesses. So instead of focusing on ads first, what we did was we built pages, and we made that free, that way as many businesses as possible could get into the network.”

This statement points towards a future scenario where businesses could engage in direct conversations with users within the app itself – a feature for which the businesses might have to pay. Such interactions could span a broad spectrum of services, ranging from taxis to e-commerce. WhatsApp plans to pilot this feature in the upcoming year. In their own words, “Naturally, people might wonder how we plan to keep WhatsApp running without subscription fees and if today’s announcement means we’re introducing third-party ads. The answer is no. Starting this year, we will test tools that allow you to use WhatsApp to communicate with businesses and organizations that you *want* to hear from. That could mean communicating with your bank about whether a recent transaction was fraudulent, or with an airline about a delayed flight. We all get these messages elsewhere today – through text messages and phone calls – so we want to test new tools to make this easier to do on WhatsApp, while still giving you an experience without third-party ads and spam.”

WhatsApp, which was acquired by Facebook for an impressive $19 billion in 2014, boasted over 400 million users at the time of purchase. Its user base has more than doubled since the acquisition, proving the continued popularity and growth of this comprehensive messaging platform.