NEW YORK - Mark Zuckerberg, known for his ambitions for Facebook, is applying a similar long-term vision to delivering the Internet to the billions of people around the world who don’t already have access.
During an onstage interview Monday at the Mobile World Congress in Barcelona, Spain, the 29-year-old chief executive officer of Facebook Inc. discussed plans for a world in which everyone has online access.
It was Zuckerberg’s most high-profile appearance yet at the world’s largest mobile trade show, signaling Facebook’s growing influence in mobile communications. The company’s mobile footprint has expanded with its decision to buy WhatsApp, the popular smartphone messaging service, in a deal announced Wednesday.
Although Zuckerberg spent most of his time discussing Internet.org, the ambitious project that aims to get the world online, he couldn’t skirt questions about Facebook’s decision to pay $19 billion for WhatsApp.
“WhatsApp is a great company and a great fit for us,” Zuckerberg said, calling the service the “most engaging” mobile application that has ever existed - and one that’s well worth its price.
With 465 million monthly members, the service is growing at a faster pace than Facebook ever has, and Zuckerberg believes WhatsApp is on track to reach 1 billion users. It’s because of that potential, and not WhatsApp’s current revenue stream, that Zuckerberg thinks the application is worth more than $19 billion. In comparison, Twitter Inc., which has 241 million users, is worth about $32 billion, based on its stock price Monday.
Even so, Zuckerberg said Facebook investors shouldn’t expect a windfall from WhatsApp any time soon. He said the acquisition will allow the startup to focus on expanding its user base - and not on making money - over the next five years or so.
That echoes earlier comments from WhatsApp CEO Jan Koum at the wireless show. Koum, who announced that WhatsApp will soon offer voice calling as it works to draw more users to its service, stressed that his company has no plans to add “marketing” or advertising to the service and that its staff of 55 is unlikely to grow much.
“We want to operate as a startup,” Koum said.
Although they’ve known each other for years, Zuckerberg and Koum worked out the Facebook-WhatsApp deal in the 11 days before it was announced Wednesday. Zuckerberg said that it wasn’t until the pair got aligned on the vision for Internet.org and getting everyone in the world connected that they started talking about combining their companies.
Relatively unknown until now in the U.S., WhatsApp is popular in other countries, both in Europe and in emerging economies. Koum and co-founder Brian Acton, both former Yahoo engineers, started the company five years ago. Unlike Facebook, WhatsApp eschews advertising and instead charges people 99 cents a year after the first year to use the service.
On the surface, Facebook and WhatsApp appear to hold divergent views on a number of matters, but Zuckerberg said the companies share a common vision in making the world more connected. About 70 percent of the world’s population, or 5 billion people, are still without Internet access. And access, Zuckerberg said, is growing slower than many people in the Internet-connected world believe.
When he announced Internet.org last summer, Zuckerberg noted that because the wealthiest members of the world’s population are already connected to the Internet, getting billions more online is unlikely to be profitable.
On Monday, Zuckerberg acknowledged that he “can’t construct a model” in which Internet.org’s efforts will be profitable for Facebook in the near future.
“I think we are probably going to lose money on thisfor quite a while,” but over time there will likely be some benefit to Facebook, he said.
Judging by Facebook’s stock price, investors seem confident in Zuckerberg’s long-term view. On Monday, Facebook’s shares hit $71.44 in midday trading, their highest level ever. The shares rose $2.19, or 3.2 percent, to close Monday at $70.78.
Information for this article was contributed by Joseph Wilson of The Associated Press.
Business, Pages 21 on 02/25/2014