WhatsApp has confirmed it will stop asking for its annual subscription fees, which is a single dollar. The messaging service won’t introduce ads, but will rely on enhancing business communication to make money.
WhatsApp, the insanely popular messaging service, has announced that it is dropping the annual subscription fee of 99 cents and making the service free for everyone. What’s even better news is that the platform’s chief executive has added that WhatsApp still won’t feature ads, a promise that the company has steadfastly stayed true to, ever since it began operations six years ago.
Despite acquisition by Facebook, the company hasn’t shown any inclination of monetization of the platform by introducing ads. Moreover, the messaging service is all set to drop its token $1-a-year subscription and go fully free for every user. Speaking at the DLD (Digital-Life-Design) conference, in Bavaria, WhatsApp’s chief executive Jan Koum confirmed that the $0.99 annual fee will be scrapped, effective immediately, reported The Guardian.
The change in its policy was announced through an official blog post.
“For many years, we’ve asked some people to pay a fee for using WhatsApp after their first year. As we’ve grown, we’ve found that this approach hasn’t worked well.”
The post added that the token $1 fees will be gradually removed from various versions of WhatsApp “over the next several weeks.”
Interestingly, the company acknowledged that killing its seemingly only source of legitimate income would certainly raise questions and suspicions if the company was going back on its promise and introducing third-party ads. However, the post addresses these concerns and adds it has something else planned.
“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.”
Though it is unclear what exactly WhatsApp’s intentions are, it could mean the messaging platform might be figuring out ways to earn money by making it easier for businesses to have a better communicative platform with their customers, reported PCWorld. What’s peculiar is that Koum also said that the beneficence of WhatsApp’s parent company, Facebook. This simply means earning revenue is still not the top priority.
WhatsApp has traditionally been free for the first year of its usage. Thereafter a token fee of a single dollar was charged for every subsequent year. While the practice for charging 99 cents continued for the messaging platform’s Android version, long term users of the iOS version were given free use for life as token of appreciation for paying an initial fee to download the app.
Although the fee was quite small and frankly speaking quite affordable in comparison to the service it offered, the method harmed its adoption, said WhatsApp. The platform was quite popular in developing countries, where many users didn’t have ready access to credit/debit card to pay the subscription fee, even if they could very well afford it, reported The Telegraph.
Facebook acquired WhatsApp in 2014 for a lofty valuation of $19 billion. Despite the acquisition, the platform hasn’t featured any third-party advertisements, which is the social media giant’s primary revenue source. Incidentally, Facebook does have its own messaging platform called Facebook Messenger. However, WhatsApp’s user base, rapidly reaching a billion, may have been perceived as direct threat by Facebook.
WhatsApp has always appealed to price-sensitive consumers. By going completely free, the company may have removed the last mental hurdle its potential adopters had.
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