Facebook is backing off from its earlier strategies to sell ads for placement inside its cross-platform, instant messaging application, WhatsApp. According to The Wall Street Journal, the company was working on structuring ads right into WhatsApp. But, in recent months, the idea has been dropped. And, Facebook has scrubbed off the code from WhatsApp that would have been used to implement advertisements.
Currently, Facebook does not charge users to access its products. Alternatively, the company monetizes information by selling details about user preferences to companies for use in targeted ads. Today, WhatsApp is the only ad-free app in Facebook’s suite of products. Whereas, ads make up a huge amount of Facebook’s revenue, leading the majority of its $17.65 billion, during the third quarter of 2019.
The WhatsApp Ad-Strategy caused clashes
Facebook acquired WhatsApp for $22 billion in 2014, and the messaging-app has around 1.5 billion users across the globe. In 2018, Facebook revealed its plans to monetize the app by introducing advertisements. But, this ad-strategy sparked clashes amongst WhatsApp founders and Facebook executives. And, as a consequence, WhatsApp co-founder, Jan Koum, left Facebook in 2018. Also, due to similar clashes associated with privacy and targeted advertisements, his fellow founder, Brian Acton, had left months earlier.
Koum and Acton said WhatsApp is the world’s biggest messaging service, and it maintains ad-free, encrypted messaging as a core feature. And, the commercial messaging feature would exert pressure on WhatsApp to weaken its end-to-end encryption.
For now, the advertising and marketing barrier has led Facebook to instead concentrate on WhatsApp features that will allow businesses to communicate with customers and arrange those contacts.
The Journal also outlines that Facebook still eventually aims to incorporate ads into WhatsApp Status feature. But, for now, the messaging app will remain ad-free.
The change of strategy comes after Mark Zuckerberg announcement to integrate WhatsApp, Instagram, and Messenger. Although the underlying messaging framework would be unified, the three apps will remain distinct from each other. Now, it would be challenging for the company to bring ads to an encrypted service, with user-privacy as the top-most priority.