While the company was not turning a profit, and in fact had just raised a reported $60 million last week from investors, Instagram was purchased by social media giant Facebook in a deal worth $1 billion. The Instagram acquisition by Facebook has the internet and media outlets buzzing this morning.
While it comes as no surprise that Facebook decided to buy Instagram, what many are trying to understand is the price. Before the Facebook purchase, Instagram was recently valued at $500 million based on its popularity and future revenue potential. Instagram is a platform which allows users to instantly share their photos from iPhone and Android devices to the web, which makes the company a good match for a social media site like Facebook.
While the site is relatively new, Instagram already boasts over 30 million users since expanding its service to include users of Android smart phones. In recent reports, a soon to be very wealthy founder and CEO of Instagram, Kevin Systrom predicted that the company was well on track to top one hundred million users.
To understand why Facebook spent so much to buy Instagram analysts are pointing to the mobile nature of the Instagram platform. Facebook, and competing social media web sites and platforms are all about the sharing of an individual’s content with friends online. The Instagram platform makes it easier and faster to post images and messages from mobile devices to a Facebook account, giving Facebook users another reason to stay with the company, and new users another reason to join.
For Facebook, which already has over three-quarters of a billion users, many of which have mobile devices which can access the internet, existing apps and mobile Facebook connectivity may not offer the same monetization opportunity which Facebook may gain through the Instagram platform.
While there are a number of reasons for Facebook to buy Instagram, including all of the free press generated from the purchase price, perhaps one of the simplest to understand is that it is sometimes easier to buy potential competition before is becomes a substantial threat. With the rapid growth of Instagram, the purchase appears to make sense for a number of reasons.
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</div>When it comes to quality control testing and the development of new products, Botanical Reference Materials (BRMs), also known as Herbal References are critically important. To help companies ultimately obtain all-important FDA approval, the Food and Drug Administration provides in its guidance a recommendation that […]<!-- AddThis Sharing Buttons below -->
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</div>A number of industries have, at their core, a need to frequent or even continuous analysis of biological media. These include the medical and pharmaceutical fields, biotech firms, and food and chemical companies. To maintain quality standards and develop new products, these industries rely heavily […]<!-- AddThis Sharing Buttons below -->
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</div>Industrial drum mixers are normally applied to blend mixes of varying viscosities such as adhesive slurries or cement. Some of these mixers have the capability of blending mixes of very different particle sizes such as fruit and ice cream, and gravel and cement slurry. The […]<!-- AddThis Sharing Buttons below -->
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