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Behind the Messy, Expensive Split Between Facebook and WhatsApp’s Founders (wsj.com)
445 points by hkmurakami on June 5, 2018 | hide | past | favorite | 360 comments



I've had a tremendous amount of respect for Mark Zuckerberg as a leader, and have gone out of my way to defend him in the past (https://news.ycombinator.com/item?id=17128369). I always envisioned whatsapp as a defensive purchase that would stay true to its initial vision (perhaps being used to prop up their other products in an unintrusive manner). But this article makes me realize Mark is s a one-trick advertising pony like half the other tech leaders out there.

His speil about how he's "connecting the world" is undermined by his clear attempts to build a monopoly of social+communication, with an inefficient layer of distracting ads. Imagine a future where every time you want to electronically communicate with someone you have to spend mental energy filtering out ads. It's the equivalent of every road having a toll booth, directly paying into a rich person's bank account. This is the "connecting the world" Mark Zuckerberg has been trying to hide from those of us who aren't paying attention.


Imagine how useful it would be if when there is a notification about a friend on Facebook, you could peek it by swiping on the notification in the android drawer like you can with texts, without entering the Facebook app.

Nope. Engineers are dedicated there to increasing other things than the utility of the app. Interests aren't aligned with the users.

Same with removing chronological feeds. Turn things more and more into slot machines.


The most frustrating change for me was FB (or Messenger later) used to send me an email when I received a message, with the message content inside the email. A few years ago they removed the content from the email and forced me to log into FB or Messenger to see the message. It's extremely user hostile.


It's basically turning your friends' messages into clickbait. I got one recently that was "Someone just flagged me down at a..." and it just feels like a really insidious way to get you to go to Facebook and read the rest. It doesn't even show that much in the actual email, only in the Gmail preview - it's just a link to Facebook (the text is set to "color:#FFFFFF;display:none !important;font-size:1px;").


> the text is set to "color:#FFFFFF;display:none !important;font-size:1px;"

Something that nearly any other company would have been banished to the spambox for.


> The most frustrating change for me was FB (or Messenger later) used to send me an email when I received a message, with the message content inside the email. A few years ago they removed the content from the email and forced me to log into FB or Messenger to see the message. It's extremely user hostile.

You also used to be able to reply to the message by replying to the notification email, so you could be a full conversation participant solely through email without ever opening the app.


They won’t even let you view messages on the mobile website either. Instead they restrict that and force you to install the Messenger app. Yelp does the same thing and feels just as scummy of a tactic. Basically both companies try to force you to install an app you don’t actually need so they can mine your contacts and personal data. No thanks to your tricks and traps business model.


Last I tried, mbasic.facebook.com would let you look at messages on the mobile web.


Wow. Can confirm worked for me. Seems like the version low connectivity countries would get


You can also tell your browser to view Facebook in desktop mode, and you can then see the messages. Not a pleasant user experience, but fine for the rare times when I need it.


It looks fine if you go to m.facebook.com and request the desktop version of the page.


This will always be the case as long as advertising is the core business model.

Social media is best suited to that kind of business model - and most people won’t pay for a subscription.

So social media is broke?


FB frequently sends notifications that is not directly related to me. e.g. "A friend has commented on a post in a group that you're a member of." Why would Facebook think this is of interest to me, is beyond my understanding.


You can change that in settings. Then facebook will not think that anymore.


There's a setting for it, but it does not turn off many different types of these notifications.

I have it turned off, and the last 15 notifications are friend activity that has nothing to do with me.


Agreed. At first I thought it was a bug, and was rather taken aback when I realised it was intentional. Of course, as I have an aversion to click-baity emails, I have barely visited FB since...


Not to defend FB on this but I can see them doing this defensively. I've seen doctors offices using FB to keep patients updated with their activities (free 'Healthy Eating' seminar), which has unintentionally been used to sent messages like 'Hey Doc needs to reschedule your colonoscopy appointment'. I'm sure FB doesn't want to get involved with indirect HIPAA violations, even if the fault lies elsewhere.


wouldn't using facebook be a hipaa violation in and of itself? doesn't information like that need to be contained to pre-approved, secure methods?


oh lord yes...like a monstrous, you need to be fired one. You can't put phi on any electronic system which you do not have a signed business associate agreement with. I suppose there's a chance that FB signed a baa, in which case this would be their problem, but it seems pretty unlikely to me.


IANAL, but there is a legal concept of ‘Joint And Several Liability’ — it might be the case that Facebook and the doctor were in violation.

Or it might have been just the doctor until someone complained and from that point on just the fact that Facebook knew about it might make them suddenly and automatically liable for further bad behaviour.


Are there any examples of service providers being liable for such communications?


I wouldn’t know where to look for an answer.


The EU, probably.


I think perhaps what's being described is akin to a bulletin board with fliers outside the doctors office, with general advice to the public, not specific directed advice to a patient about their specific health issues. I'm not sure that falls afoul of HIPAA, I would imagine it doesn't since it's not specific at all.

At the same time, that also makes it irrelevant to the point at hand, since it's not Facebook messenger at all, just general health posts and items offered by that medical group.


An easy solution would be to offer a "no preview" flag. But this also doesn't make sense because presumably the person's email account (where the preview would appear) is as private as their messenger. People who don't want to send info in email tend to send links to a secure portal, which they could do just as well in Messenger, preview or not.


Wouldn't that be on the doctor, and not Facebook (assuming their ToS says not to use it for that stuff).


Last time I checked, ToS had nothing about HIPAA. I even contacted them, wouldn't answer if they where HIPAA compliant or not. Wanted to know, just in case a doctor ever talks about communicating through them.

Any one that does communicate through them with their doctor, most likely doesn't know what HIPAA is or care.

To FB, it is the old "don't ask or tell" scenario.


We just started trialling Facebook Workplace. Unfortunately the same is true of that. It’s all about getting you back into Workplace, rather than actually doing your job.


My employer has been using Workplace for over a year. It took over a year to finally hear it from other colleagues that they don't see some posts, which I started telling from the very first day.

And the reasoning to use it? "People are familiar with it from home". Well.. how about using something else and spend 30 mins on educating people? Oh, that might mean no new yacht for shareholders this year.


> It took over a year to finally hear it from other colleagues that they don't see some posts, which I started telling from the very first day.

I wonder if you have to pay FB to promote them? /s


<evil thought>Better still, you pay Facebook to _bury_ them. You raise all the important concerns about how the project you're working on is going to completely fuck up, and quietly arrange for Zuck to get a little richer while ensuring none of your cow orkers see these messages. Then you pull them out at the inevitable blamestorming meeting and say "But look! I raised all those big red flag problems on date[1] date[2] and date[3], and was ignored by everybody!"


Facebook. Pay us to empower your toxicity!


This. Why on earth would an organization invest resources in a productivity tool which is by design optimized to make you procrastinate?


I’d never allow Facebook inside the firewall, but I did do a Yammer trial.

It was actually really cool, except nobody wanted to “own” the community, and eventually some assholes decided to be assholes and got it shut down.


See my sibling comment - "because people are familiar with it already".


" Engineers are dedicated there to increasing other things than the utility of the app"

I'll qualify that statement by adding that product management/design team is optimizing for engagement metrics and the engineers are developing from those blueprints. Blame product management for anti-UX decisions. No PO/PM is going to risk their career by spearheading an effort to lower app engagement metrics which results in a loss of advertising revenue.


I get the intent of what you’re saying, but when you have things like this they’re usually representative of the team or company as a whole, rather than a single profession.


You’re correct, and that’s the bigger point. The entire industry business model is tilted in that direction.


Yes! The worst for me was a couple of days ago, I started playing a video, I changed tab and the video stopped! I came back and it started again. I guess one of their main KPI it's time on site, like people are not spending enough time already, and regardless of how people want to use their website.

Edit: rephrased one sentence


This might also be a feature of your browser. Firefox and chrome both implemented this a little while ago. If you pin the tab, it shouldn't stop playing video when you switch away. I forget which of the browsers, but it really helps people on bad laptops and what not.


but it doesn't append with youtube for example


Well, a lot of people use Youtube as a music service, so that makes sense. I think there may be a domain whitelist for non-active page video in chrome, which was brought up and discusses here a while back, but I can't recall. Or maybe it was auto-play? Maybe they share a whitelist though.


Removing chronological feeds was the straw for me to quit facebook and linkedin.


People go to LinkedIn in for the feed?


It's kinda nice to see what new jobs your friends have.... But that requires you to have friends.... Sooo I guess I have no reason to go.


keeping track of what former colleagues are up to was my main use for it


What do you mean by peeking at the notification?


Seeing the actual content of the notification instead of, e.g., "John mentioned you in a comment.".


When you've got a notification on your smartphone drawer and you tap or slide down on the notification to see the beginning message contents.


What do you expect for a free product? The entitlement of people is astounding.


It's not free because as it is currently, it's not free to NOT use.


Except to show that notification on your phone, Facebook needs to give a 3rd party (Phone Manufacturer) access not only to your data, but data about your friends.

This is something people are currently very upset with them for doing.

So they can make things convenient, or keep your data safe, but its hard to do both.


Their code is executing with a third party kernel, trusting that but not trusting the notification system which sits way above hierarchically seems like a very arbitrary delineation.


> So they can make things convenient, or keep your data safe, but its hard to do both.

Even if your argument made sense with respect to the thing people are currently very upset about (which I disagree that it does), there is absolutely NO inherent right for FB to exist if they're unable to do both (if it's just "hard", well then get busy).

If I want to keep my data safe, they get to "inconvenience" me? That's ridiculous, if they can't keep my data safe, they don't get shit.

"But it's hard!"

cry me a river


That's simply not true.

It's an API to publish a notification - a similar API to that used to build the core app. There's no additional sharing of data than what's already happening running the app.


Maybe I'm just not creative enough, but what is a better alternative?

Let's say you have a subscriber model, but than what kind of world will it be where only the wealthy have access to these communication technologies and access to social information.

Or you have a hybrid ad model with the ability to opt out by paying some fee. Than what kind of world will that be when privacy is a luxury item limited to how much you can afford.

The best solution I can think of is keeping the current model, but adding regulation and government oversight to limit some of the most damaging effects i.e. creating platforms that abuse human psychology to keep people clicking and make them addicted to these platforms.

I'm genuinely interested in other models people suggest.


In the past the function of the "phone company" was a paid for service which provided for your communication needs. You didn't have to listen to ads before you could talk to your friends but you did occasionally get unwanted calls.

This medium reached people rich and poor, all around the world.

The challenge here is greed.

One of the interesting topics in economics is the ability to subvert the supply-demand curve by extracting economic value without the participants awareness. In classical economics the equilibrium point is met when the buyer thinks they are paying too much and the seller thinks they are getting to little for a good or service. In the idealized experiment the buyer doesn't have any other choice, nor does the seller have any other customer to turn to.

But in our internet connected world there is an "invisible" (to the buyer) stream of value which is personal information about the buyer. To date there hasn't been a good way for the buyer to see or negotiate that value. GPDR helps that but it doesn't go far enough in some ways.

What GPDR doesn't supply (yet?) is the practical way of enforcing the theft of personally identifiable information for financial gain. So in your example of a hybrid ad model, if you 'opt out' and now pay a fee, how do you know that they aren't still just selling your data? And if they are selling your data to get extra value out of you being a customer, what recourse do you have when you discover it? What risk are they taking by pursuing that path and maximizing their revenue?

EDIT: From the article -- At the time of the sale, WhatsApp was profitable with fee revenue, although it is unclear by how much. (99 cents per year)


You're right! The phone model of pay-for-use has made telecommunications available all over the world to all kinds of people.

Yet, it might be worth contemplating a few details about that. First, it took decades to do so. During almost all of that period, phone use was very expensive for most people, making it something reserved for the rich. It's taken from 1876 to today for almost the entire world to have phone service.

Second, expansion of phone services was often controlled and directed by monopolistic companies. They invariably acted in incredibly greedy ways and had no compunctions about abusing their position(s). Extortionate long distance rates, asserting that only company-owned systems could touch the networks, and more were normal.

I understand why you view phone access as a good model, fundamentally different from an ad-based or subscriber-based model. Yet, it's possible that this approach historically had some rather significant drawbacks that might be worth contemplating.


You are conflating the model with shifts in technology. The US landline infrastructure was really expensive on a per-user basis. Mobile was much cheaper to implement, and the shift from analog to digital audio drastically decreased the cost of call transmission.

Those same digital technologies mean a regulated social media monopoly could be much narrower. E.g., we could split Facebook into infra and client apps, or core features versus add-ons. You could make the social graph owned by a non-profit, and regulate it with a board where client app developers are represented. That would provide a much better balance of power than we saw with telcos versus consumers.


Mobile was also very expensive for a long time, and thus primarily reserved for the rich. Shifting from analog to digital was something telcos did mainly to lower their costs to enable them to extract higher profits.

So, you're right! Shifts in technology brought prices down to a point where they're affordable to most! That's something enabled by a model that inherently advantages the rich over the poor. But the economic incentives created and encouraged by history and the model are just a detail, not worthy of inspection or being considered part of how we got here.

Right?

As for your proposal, I don't share your optimism for regulated monopolies here. They're a wonderful model for basic needs that everyone shares and that little change will be needed to over time. This describes electricity, water, and in some cases data transport.

It's certainly possible that social media services to date have hit this basic level of common infrastructure. If so, I clearly just don't understand exactly which services that covers or how they're the same level of fundamental as water. Can you help me with this? I need to understand before I can figure out if dismembering Facebook into a publicly owned council-run monopoly is the best way forward.

Especially because this would also probably mean doing something to ensure other, non-council-run social network providers didn't spring up and replace PublicBook.


My point was that your apparent objection to the phone company analogy to finding ways to fund social networks was based in a false comparison. If you now agree your objection was wrong, and that social networks could now be funded in ways besides eyeball sales, then I don't see a need to pursue that further.

I honestly don't believe your "help me understand" routine is anything but syrupy and disingenuous, an online rope-a-dope. If you're actually serious, please demonstrate that by providing your own best guess as to a plausible split and your concerns about the model; I'll do my best to help you with that.


I agree that there are most certainly alternate means by which a social network could be funded. Subscriptions, pay-per-use, and public funding all come to mind. I don't agree that this invalidates my previous points about phone networks and their history. New technologies enabled prices coming down because a long history made it worth investing in. Nothing about those technologies or price reductions was inevitable.

I can think of several plausible ways to split up Facebook. The one I can think of that adheres most closely to the basic utility model would be for only the most foundational service to be handled by a regulated monopoly. That, I expect, would be a pseudonymous social graph where people can add and remove connections. Anything on top of that would be handled by third-party providers.

I can imagine other services that some people might consider foundational and thus desire to lump in with the above. Some might consider posts, walls, profiles, and groups part of it. Some might even consider chat part of the foundation.

The "online rope-a-dope" you describe is my attempt to avoid telling people that I am reasonably sure they are being silly. It's always possible that there's genuinely something I don't understand about the positions. It's happened before, it's happening now, and it will continue to happen in the future. It generally doesn't, but telling people I think they are being silly is generally not conducive to productive conversation.

Being over-the-top syrupy nice tends to go over better than pointed criticism, which tends to make people defensive. For example...

Under which set of laws would Facebook be nationalized in your proposal? American? French? English? Turkish? Saudi? What effect would this have on effects to combat fake news and hate speech? Whose definitions of "fake news" and "hate speech"? How are you going to make sure that users don't migrate to a new, better, and non-regulated-monopoly social network the way people migrated to Facebook from MySpace? Are you just going to take over that one too? How do you propose to ensure that client app developers with access to the ruling council don't use their position to push away other client app developers?

These aren't pointlessly detailed questions. They're ones that spring to mind almost immediately, and ones that any serious proposal that merited consideration would need to wrestle with. Some of them are major points of public policy which differ very significantly from polity to polity.

I would like to understand that you've gone through these questions and arrived at good answers. I want that to be true.

You're probably feeling defensive right now. A little attacked. Which is why I couched the whole thing in asking you to help me understand, because a person who feels attacked is not a person who is genuinely listening.


I don’t know how old you are, but phone calls were really expensive in the decades before 2000. It’s not something low income people could afford to do very often.


I expect this depends a lot on where you were living in the decades before 2000 and what you mean by "phone calls".

In much of the US, in the 70's, 80's, and 90's a telephone had a fixed monthly fee and 'free' calling to any other phone in the local area. Phone penetration was over 90%[1] in 1970 and rose to over 95% by 1980 suggesting that even those at 50% below the poverty line in 1980 (roughly 6% of the US population) had access to a telephone.

So for many living in the US they have probably experienced being able to talk with all of their friends for "free" as long as they want, and if they were old enough arguing with siblings about who got to use the phone longest.

Further, in the "current" epoch, the article suggested that WhatsApp was profitable at 99 cents per year when it was acquired. I would not be surprised if that it is still the case that such a messaging service does not require advertising revenue to be cash flow positive. It just needs enough subscribers.

[1] https://www.statista.com/statistics/189959/housing-units-wit...


I grew up in LA in the 80s. Yes, "local" calls were free and that probably covered most of the people you went to school with. If you had friends or family members 20+ miles away (commonplace for car-centric LA) it was pretty easy to rack up huge bills.


My first boyfriend was born in the late 70s (UK) and hos family didn’t own a phone — not one landline phone between them — because phones were too expensive.

I was early 80s, and watched landline and mobile costs fall to negligible levels.

My current girlfriend was born in the late 80s (USA, but world traveler with family work), and I think from the start of highschool onward pretty much always assumed there was an internet connection and too-cheap-to-care calls even before everyone made their own VOIP/video chat messengers.


Most of us had family outside of our area code which meant large bills if we wanted to talk to them on a regular basis.


I understand, although we can argue about 'Most of us' versus 'Some of us'. My experience was that my need for out of area calls went up only after I moved from where I went to high school to where I went to college. And many of my friends stayed local. There was a great piece in the NY Times about 3 years ago that talked about how the typical American lives within 18 miles of their family.(found it https://www.nytimes.com/interactive/2015/12/24/upshot/24up-f...)

Something that came with the Internet, and didn't exist for me prior to its existence, was a large body of friends who were not local to me. Today, if I had to go back to metered long distance rather than what we have today it would absolutely be cost prohibitive! And clearly some people move around more than others and for them they might have a lot of friends and family outside of their local calling region back then as well.

The bottom line is that I can see the point you were making but I think we disagree on the magnitude of its impact on the general population that was living with phones at that time.


If it was too expensive to dial out or accept collect, life went on for people rich and poor. I think we’ve entered a world where opting out of constant communication (like not answering your phone) is completely alien and in some cases unacceptable, which in turn makes the prospect of constant communication valuable. But I’m not sure how many use cases are out there for how constant digital connection improves outcomes for acute life events or quality of life in general, but the assumption is that it does (despite growing research to the contrary).


> I think we’ve entered a world where opting out of constant communication (like not answering your phone) is completely alien and in some cases unacceptable

I left my smartphone and my smartwatch in my smart home when I went to work today (guess I'm not that smart).

I hear through the grapevine that my wife is losing her coolant because she can't text me every ten minutes, or locate me with Find My Friends.

I think I'll stop at a tiki bar on the way home.


Your talking about long distance, local calls were inexpensive and available to all for low prices.


Depends on how "local" was defined in your area.

We had multiple independent local phone companies one place I lived. I could call into the next state for free (and by dialing just five numbers), but my friends two miles away in the same state were 35¢ a minute.


Right, being able to talk to anyone in the world for free is a HUGE improvement.


Phone calls were expensive because telcos were (still are) a monopoly. Phone calls got cheaper only because they eventually got competition from VOIP-like solutions.


>In the past the function of the "phone company" was a paid for service which provided for your communication needs. You didn't have to listen to ads before you could talk to your friends

As a point of interest, back when people used dialaround numbers to get lower long distance rates (800-Easy-ITT for ITT, 800-Pin-Drop for SPRINT, 950-4MCI for MCI, or 1010-NJB for New Jersey Bell, etc...) there was at least one service that would make you listen to an ad before connecting the call. In exchange, you got a super-low rate.

I don't know if it failed because of the advertising, or because the line quality was terrible.


WhatsApp had a subscriber model (99 cents per year). It was still very successful in India, a relatively poor country. I remember visiting villages in India, where people who are quite poor by western standards, still preferred using WhatsApp to other services.

I think that reasonably priced subscription model, perhaps taking in account the per capita income of the country, could help preserve privacy while also ensuring mass access to technologies.


The problem is greedy attitude of people. As long as one can earn more by selling user information, there is no incentive for reasonably priced subscription model.


Do you know that those Indian people had actually paid for WhatsApp? I never had to pay, and most people I know (UK) don't seem to have done either. I don't know what the criteria was but it'd be pretty weird if they were charging people more aggressively in India than the UK. Maybe the whole not charging thing was a bug, it's always seemed weird.


I don’t think many if any Indian people actually paid for Whatsapp. Most people overall didn’t pay for it.


> Maybe I'm just not creative enough, but what is a better alternative?

> Let's say you have a subscriber model,

There was a company with a subscriber model. It worked pretty well and we loved it. Facebook bought it and destroyed the very idea behind it.

> but than what kind of world will it be where only the wealthy have access to these communication technologies and access to social information.

The same kind of world were all kinds of tech is expensive at first and then becomes cheaper and cheaper as it approaches and enter mainstream usage?

Nobody would argue today that we should have refused luxury cars to add airbags because "what kind of world would it be where only the rich has access to safer cars".

In the same way we shouldn't argue against people paying for better products.

That said, I think WhatsApp were planning to add other paid options like API access etc before they got eaten by Facebook.


How about crowdsourcing a social network? Look at synology NAS boxes-they have a ton of apps. They have even developed a stupid-proof way of connecting NAS boxes securely over the net without opening router ports. If i choose to install the synology 'chat' app, i could designate a fraction of the NAS space as a se[arate volume to be used soley by the app and sandboxed from my LAN. And just as synology boxen can sync with each other silently, securely and in the background- this 'chat' app can interact with the millions of other synology boxen. Of course to be a member of this ad-free, toll free network - you need a synology box in this model. But after all, it's just a linux box - however the tech for connecting them securely requires a handshake mediated by a server at SYNOLOGY. And they provide all this FREE. It is similar to the iMessage network that apple runs. And again you need an iPhone to be on that network.


A decentralized social network, built on peer-to-peer connections, allowing people to connect with one another without being intermediated and monetized by some central party? Sounds idyllic!

Is it possible that perhaps this has been considered before, and perhaps even implemented?


Isnt this what diaspora and mastodon are doing?


Maybe!

It's also what email is.


not really. email and list serves are somewhat 'dead'. they are distributed in chunky dumps only every so many hours. bbses are closer to what engage people. conversations are updated in a more granular fashion with a greater respect for timeliness. the point i was making is the current existence of a turn-key box that could be the building block of a publicly administered peer to peer network. the power of peer pressure is not to be underestimated. even my son who is a software engineer, knowledgeable about android, hacks his pixel , etc is moving to an iPhone because he has many friends - not software savvy - who are all on iPhones and iMessage each other , FaceTime themselves, etc. The magic can happen with A box that you can turn on and simply click an 'install' button that gets a peer to peer chat app that runs in a sandbox, shares some of your NAS space, is always on - A hooli box to make a new internet


You're right on all your points. In detail, no less! Such a system could indeed be marvelous, a system to make a new internet for a new generation.

Yet, you're describing email still in essence. A system where people interact very rapidly in a distributed, authority-less magic box based network. Email happens to be chunk-y, though in practice it tends to be nearly as fast as chat.

But I'll humor you. Now you're describing XMPP. Magic sandboxed chat applications, peer-to-peer, NAS storage, authority-free, and monitization-free. Wrap it up in Docker or something, and you have your turnkey magic. Right? Right!

You still have all the problems that come with this. For example, stemming abuse is a major problem with decentralized systems. How do you stop spammers? Appeal to the decentralized community and hope? Peer pressure has never been enough to stop this. Authority and trust problems run rife. Most users are too ignorant and unskilled to look after their systems properly, which is a problem you won't be able to magic away.

I'm trying to be nice here. You're re-inventing email, in a way that does nothing to stem the basic problems of email. You have all the idealism that created email to begin with - lovely, beautiful, admirable idealism! - and little of the pragmatism.

Fundamentally, there have been two kinds of decentralized, authority-less, un-monetized networks: those that are unpopular and those that become popular enough to be subject to a ton of abuse. Abuse that leads to professional service offerings that re-centralize, re-intermediate, and re-monetize the services in order to make them usable to ordinary people again. It's absolutely possible that your idea would be neither of those! It's just that so far I've not been shown anything convincing that this could be the case.


There is no shortage of options out there, the issue is onboarding people. Even google couldn't swing it with google plus.


It was called a BBS network. One example was ARBNet.


Let's say you have a subscriber model, but than what kind of world will it be where only the wealthy have access to these communication technologies and access to social information.

This is a strawman. I give you Usenet and IRC as counter examples.


I believe the Facebook business model can be safely stripped down to the humane kind while still keeping viable. The revenue it can generate by displaying organic ads without excessive user surveillance (analyzing a user's likes and the kinds of ads they tend to click is ok, spying on every website they visit is not), without messing with politics and without selling data about the users to 3rd parties can still be enough to cover all the relevant expenses and generate profits (probably a way more humble than now yet positive) for the investors.

Facebook can also employ the experience of it's Russian clone vk.com and let users share music (sharing the music that you like and that expresses the mood you'd like to share is a great way to communicate and many people love it!) while requiring those users who'd like to play long playlists in background pay a subscription fee.

A number of other premium features that can add value to a subscription comes on to my mind as well: invisible mode (I'd pay for it immediately - I really hate when others can see if I'm online or if I've read their message, I have been actively hating this for years, this is infuriating yet I don't mind if solving this problem would cost a dollar or two per month), posts promotion, additional typesetting features, profile promotion (top-suggest everybody to add me as a friend), verified status for whoever wants it (not just celebrities), voluntary additional surveillance/curation (for parents willing to protect their underage kids) etc. Introducing a cryptocurrency dedicated to replace old-fashioned likes (e.g. every time somebody likes your post/comment you get a coin) yet traded at a cryptocurrency exchange and accepted as a way of paying for the premium features can be another opportunity. Organic possibilities are limitless.


phones worked for decades with fees. probably can't bring that model back but just pointing out the world still worked when communicating cost money. we had subsidies for the poor (no idea how effective they were)

note I'm not suggesting we go back to that model. only pointing out we had a non ad based system before


Free version for those with verified low income?

(I've been toying with models like this for awhile, and not to say its an easy or simple solution to implement, especially when considering bad actors, but it seems the best chance at getting something "fair")

Alternatively could steal from games and add "cosmetics". Charge extra for things like themes that personalize but don't necessarily improve the experience. Items with enough value that people will "want" it but not "need" it.


Proof of work from non-paying customers? Something that benefits the company (retweet to pay), or better yet, something that makes the world better? (eg pick up trash, socialize with an invalid, etc.)


Whilst creepy, I love the idea of a proof of work system like this, something that anyone can participate in. I just don't see how it could be achieved in a way that couldn't be gamed.


What's the definition of "low income"? It would vary wildly from country to country.


Not saying I support the original idea, but there's objective, widely agreed-upon definitions for poverty, so it should be possible to transfer these to define low income.


> objective, widely agreed-upon definitions for poverty

No, there aren’t; this is a political line that doesn’t make any sense at all. This is why “livable wage” is a phrase: just getting above the poverty line does not imply you can live on your income. The poverty line is pegged too low to be meaningful, at least here in US.


Like everything that exists in the real world, it doesn't have to be perfect.


...right, but if you don't care about how accurate it is, the value of distinguishing people is questionable.


The widely agreed upon definition of poverty varies hugely from country to country.


> only the wealthy

Roughly $40 billion in revenue, divided by 2 billion users. Only the very poorest wouldn’t be able to afford it.


To be honest all of the Silicon Valley innovators have this cult of personality that once you look behind the curtain they act in their own self interest (which isn't a bad thing).

For example Elon Musk has his "Iron Man" persona that puts himself on a pedestal and projects an ideal that his companies will solve the worlds problems. Once you look behind the curtain you see that he uses this to justify long hours by his workers. The innovation he has is an acceptance of failure for mission critical systems and quality assurance like cars or rockets.

The moral of the story is that while the people at the top might make it seem like they do the right things for the right reasons the reasons that any rational person actually do are the right things for the reasons to expand your new business.


Elon Musk is probably the easiest person to point at because he’s worst at it. He has a novel approach of talking down the odds of success of any newsworthy rocket launch and he clearly doesn’t understand that criticising journalists’ reporting of Tesla autopilot issues isn’t going to encourage good reporting.

He looks and sounds so awkward in interviews that he may have as little charisma as I do… at least, if you can ignore the fact he’s a billionaire, which some people find very charismatic in itself.


> The innovation he has is an acceptance of failure for mission critical systems and quality assurance like cars or rockets.

That's definitely not the case unless you're really just out of touch or purposefully trolling here.


See, I don't want to defend Elon but he seems the most balanced among big tech executives, in that he is invested himself in the outcomes of the companies. He spends the long hours, or at least spent them in the past.

I think he is more self aware in general than other execs. He found away to mix self-interest with solving worlds problems. I mean there is still potential for things to go awry.

But at least he is not Facebook. He is not a casino owner or something similar.

With him I don't think you can separate the right reasons and the business reasons


It pays to signal that you’re mission driven. Employees engage more.


Yes, but it can also be an easy way to justify exploitative work conditions worse than industry standard.


Yes. And underpay. I was arguing why someone would rationally seek to appear mission driven. It holds in many cases.


This is why blocking ads is pretty much a moral imperative. People should block ads until we no longer have to put up with business models such as "let's shove our sponsored content down their throats".


I read the article based on your comment, but I disagree overall.

I do agree that it was---in retrospect---unfortunate and optimistic of MZ to promise too much freedom and independence from FB. But it seems FB _did_ give WhatsApp a long runway, it's been 3-4 years since the acquisition. If their ideas don't work (wrt bringing in revenue in line with the acq. price), at some point you have to go back to square one and do the thing that works (also for IG), and do the FB-style ads/monetization.

I don't have a lot of sympathy for the WhatsApp founders. They took the money (they're worth almost $10B now), they did have 3-4 years to find their (and their team's) way within FB. It's cool that they don't like ads and moral standards or whatever, but come on, you have to be more rational when you're playing in the $10B league.

Disclaimer: I worked at FB previously for a short time.


> but come on, you have to be more rational when you're playing in the $10B league.

Or, being able to choose between $10B and your values shows your character.


I think 99.99% of people would go with the $10B. It's not like you have to kill babies for it... It'd be dumb to hold this against the WhatsApp cofounders. I just think the parent comment saying MZ is somehow evil for this is not right. MZ believes in the ad supported model, and there isn't a whole lot of evidence against it so far. I prefer getting targeted ads over generic weightloss ads. I prefer a professional product over some shitty federated/opensource thing. A lot of people are upset, but then a lot of people don't have a clue how it works (also see the senate hearings, or the device manufacturer thing).


Facebook ads genuinely add value though. 78% of randomly polled US consumers discovered a new product that interested them on Facebook: https://image.slidesharecdn.com/internettrendsreport2018-180... (From Mary Meeker's 2018 report).


Just because someone is convinced to part with their money does not mean they meaningfully added value to their life.

Certainly generates value for Facebook and retail, though.


If they themselves say they discovered a product that they were interested in, how is that not value addition? Value isnt defined in your advertising free ivory tower.


It isn't defined in your ad-filled cesspool, either. I don't see convincing someone to buy something as an absolute positive value. There's nuance. Making someone aware of a product that will genuinely improve their life is great, but most ads in my experience are more like drug pushers.


Ah, yes, because we brilliant hacker news readers know that the average person is too stupid to know what things they should buy or not buy.


That's not my interpretation of that comment. To wit:

There are only a few things you can know about someone clicking 'buy' as the result of an ad:

1. The ad platform booked top-line revenue

2. The seller booked top-line revenue

3. The buyer exchanged money for something they thought was worth it at the time of purchase.

That's it. Even #3 is conjecture, but it's likely enough that I'm willing to run with it for sake of argument.

We do not, and short of asking, can not know if that purchase added value to the buyer's life.


But how much value do they also take away? My bet is that they are a net drain.


They are also phenomenally effective for retailers selling products, if you are slightly out of the mainstream and people aren't Googling you then your only web option is facebook and we have found it gives an excellent ROI.


This would not distinguish whether behavior tracking to algorithmically personalize ads ends up being better than just naive ads based on page-level content or other data unrelated a person or the person's behavior.

What you're describing for non-mainstream sellers is just gains from internet-scale distribution platforms, whether it's Facebook or Reddit or whatever. It lets the little guy reach lots of people on a much smaller ad budget because of the distribution technology and a platform's ability to grow a large network of users.

Whatever benefit there is might have nothing to do with Facebook (or any specific company) and have nothing to do with tracking users to target ads at them.

It might just be "the internet is a big lever" that lets smaller sellers more easily reach people generally.

That might be argument that ads, in general, can be valuable on Facebook. But it might be the case that the extra effort of personalizing them does not add further value, while it does have downsides with data privacy, tracking, unwanted ads, etc.


You can test this yourself easily on facebook. Just target a blank audience of all users vs a lookalike audience FB builds for you algorithmically. The latter works much, much better at generating sales for almost everyone.


> "The latter works much, much better at generating sales for almost everyone."

This seems like an extraordinary claim that would require extraordinary statistical evidence to believe it. Both evidence to ensure the methodology of comparing whatever Facebook does with blank audience ad serving to whatever is done with lookalike audiences, as well as the "much, much better" part and the "almost everyone" part.

For example, with Google and Facebook controlling so much of all advertising traffic, it could easily be the case that 'blank audience' ad purchasing (which is less in Facebook's interest, since it doesn't help highlight their specialized data products) are directed towards users with less likelihood to engage to begin with, regardless of algorithmic profile or interests.

Do we have any knowledge of the precise differences of the two treatments (blank vs. digital lookalike)? If not, how could we even begin to attribute success seen in the 'lookalike' category to any value-add from Facebook? As opposed to possibly gaming the different user groups to make such an A/B test always tilt in their favor.


Alternatively, you could serve ads on Yahoo, or Reddit, or the whole Google Display Network, etc., and see how much vastly worse those clicks convert for you.

This isn't rocket science. I've managed millions of dollars of ad spend across a dozen companies. I know lots of other people who manage ad spend. The only other digital channel that's anywhere near as targeted and scalable as Facebook is Google search, which is why the two combined make up 90% of new online ad spend (according to data).


> “you could serve ads on Yahoo, or Reddit, or the whole Google Display Network, etc., and see how much vastly worse those clicks convert for you.”

But that experiment could only possibly tell you if Facebook ads, in general, are more effective than ads on other platforms. And that might be caused by all sorts of confounders, like the relative demographics or usage patterns being different on those other platforms, which have no connection to whether anything that Facebook does contributes to positive ad effect.

In particular, comparing with other ad platforms could not tell you whether Facebook invisible audience ad algorithms are any better or worse than Facebook algorithmically targeted audience ads (especially since you still wouldn’t know if Facebook privileges algorithmic ads in some way just because it’s good for their business if it appears that their specialized product is better than a non-specialized one).

> “This isn't rocket science.”

It’s funny to me that a lot of marketing, product, and A/B testing people express this attitude about understanding what succeeds in marketing & product problems.

When really, those questions require a great degree of statistical rigor that is like rocket science.

It takes a great deal of advanced econometrics theory or formal statistics theory to answer ad spend attribution questions in a way that’s not completely defeated by methodological flaws, poor experimental design, causal indeterminacy, or various statistical fallacies.

Perhaps it’s one reason why the claim that digital ads work is still so hugely debated, with many claiming that quantitatively, digital ads (including Facebook) utterly don’t work.


The slide says just that people have bought stuff they found on "Social Media". Doesn't mention that these are through ads or any indication of "Facebook ads genuinely add value though".


I doubt that 78% of Facebook subscribers had money just burning a hole in their pocket. Advertising is just borrowing from Peter to pay Paul.


How do you think capitalism works?


The private ownership of the means of production?


Toxic consumerism is not a required (or even desirable) requirement for capitalism.


The net value of Facebook ads would roughly be taking some measure of how much it helps minus some measure of how much it hurts.

You posted some way of roughly approximating how much it helps. But looking at metrics like this in isolation is meaningless and there's no useful interpretation except for people (such as in the ad business) whose utility function for this topic only depends on the upside component.

Society at large also depends on downside components, like how much psychological drag the pervasive ads generate, how many people are deceived or manipulated into mis-wanting something purely because of ad repetition, how many times are ML-based personalized ads miscalculated, leaving a consumer to experience inappropriate or irrelevant ads because of algorithm malfunction. How much extra cognitive effort is required to maintain browsing solutions that mitigate tracking. How much of the ad experience facilitates addiction to mobile phones. And so on.

I am not claiming that I have a great way to roughly quantify these, but you could. For example, you could do eye-tracking and phone usage studies and try to roughly compute the amount of extra app time that is attributable to dealing with unwanted ads or app time attributable to ad-linked addictive behavior, and then estimate up what some average case cost of that time would be at a median salary or something, to roughly value that time. Or you could gather statistics on how accurate data-based ad personalization is and how often someone spends time costs processing misclassified ad categories they self-report as not relevant.

I conjecture that the financial cost of that lost time (which is an under-estimate that doesn't factor in other psychological drag or second order effects) would, when aggregated over hundreds of millions or billions of people, add up to waaay more cost that what the offsetting value from effective ads and product discoveries offered, meaning that from a perspective other than the consumer corporations that profit from the transactions, it would look like a giant net loss for society.


Are those statistics a direct result of promoted content on those platforms or a combination of that with normal word of mouth from peers on those platforms?


I am not a fan of his, but is the situation going change unless people are willing to pay for these services? Most people wouldn't even pay for something as useful/important as email, let alone social networking (I can never understand the need for something like Facebook)


Yes, someone should make a messaging app with end-to-end encryption that costs $1/year. I think it would do well.

edit: this is supposed to be a WhatsApp joke.


Whatsapp never really did this. This is a common misconception especially around here. Whatsapp did $10M in revenue in 2013 and $15M in the first half of 2014. This is with a user base of 400M active users at the beginning of 2014 and 700M active users at the beginning of 2015 (and getting to 950M, 1.2B, and 1.5B over the next three years).

When Whatsapp did charge for iOS users, it was a one time payment as well. So not yearly regardless.

The app wouldn’t have the popularity it does have if it charged everyone $1 a year. That’s significant to some people vs others. Especially when looking at WhatsApp’s global user base.

Whatsapp was operating at a loss during its high growth time period before the Facebook acquisition.


It’s called Threema:

https://threema.ch/en

(Signal is free, though, and Open Source …)


Yes, but, in contrast to Threema, you have to provide your phone number in order to use Signal, which results in an immediate loss of anonymity.


WhatsApp didn’t have end-to-end encryption when they were using the subscription model though.


I’ll pay. So what are my options? What paid, ad-free social network is there that most of my contacts are on?

There isn’t one. LinkedIn is sort of an exception but it’s not for general use. The market isn’t providing s supply of these products so I don’t see how you can say there’s no demand. New social networks have such high barriers to entry that you can’t just point at some random failed paid one as an example. Loads of free ones fail too.

What would be interesting is if Facebook offered a paid, no data-mining option. But they do t seem interested in innovating.


People pay for internet access. They can hang something at the end of their internet access pipe which supplies them with these services at their own cost (electricity and hardware, mostly when using free software). So yes, it is possible to envision a future where this situation has changed for the better.


People pay for internet access

Isn't it like saying "I paid for the car, why do I have to pay for gas"? Somebody has to pay for engineers, infrastructure etc. If not the end users, then the advertisers.

I guess it is the mindset/understanding. The same person who won't pay $1 for email (for example) will pay for Netflix, because somehow in their mind, it takes money to make movies but it doesn't take money to write software or run servers.


No, that equivalent would be 'I paid for the car, for gas, insurance, car maintenance and for maintenance of the roads, why would I need to pay to drive to the city'. Indeed, why would you?

I'm talking about distributed services here, 'run your own' as in run an instance for your family and any friends you care to provide those services for. I've been doing this literally for decades, ever since I got a permanent internet connection in the 90's. Others here are doing the same, this is not some outlandish concept.

By paying for internet access you pay to have the ability to send data all over the world. If you then also pay for a device which can provide services with that data using free software, which interacts with other such devices owned and operated by other people who likewise pay for internet access and for those devices and the power to run them (etc) there is no need to pay yet again to use those services.

There is no need to pay engineers to run the services as they're running on your own hardware using free software. You already pay for infrastructure through your internet access payments. You pay for your own infrastructure at home.


'run your own' as in run an instance for your family... I've been doing this literally for decades

Okay, do you also fix your car, make your clothes, fix your plumbing...?

How can we reasonably expect an average person to install, configure, maintain non trivial systems like emails?

We get paid to do things we want to do and are good at, and we pay others for services/goods that we need but aren't capable (or don't have the time or interest) of doing it ourselves. It is unreasonable and impractical to expect everyone to do everything themselves.


Yes [1].

Nobody expects the average person to install 'non-trivial systems like emails', just like nobody expects them to configure, build and install Android or iOS on their mobile devices yet still they use those devices without undue problems. They even update the things to new releases, mostly without problems. The reason for that is that someone went to the effort of packing up Android and iOS so that it is possible for just about anyone to install them on their devices.

> We get paid to do things we want to do and are good at, and we pay others for services/goods that we need but aren't capable (or don't have the time or interest) of doing it ourselves. It is unreasonable and impractical to expect everyone to do everything themselves.

This is where free software enters the equation, a few people working on a project like this can make a huge difference. Maybe those people get paid to work on free software, maybe not, this is irrelevant in this context. What is relevant is that digital technology does away with scarcity, the work of a few or one can be made accessible to the world without cost other than that of internet access (for which, as stated, the user already pays).

[1] While I do not have a car myself I do fix my wife's as well as my motorbikes and tractors. I generally do not make my clothes but I do fix them. Yes, I fix my own plumbing, not that strange given that I restored and partly built our house which includes installing said plumbing. I'm currently building roof trusses for yet another build-out. Specialisation is for insects.


Realistically, this is impractical for 98% of the population. I say this as somebody who has run his own mail server in the past, and got sick of the endless hassle of maintaining and securing it.


Money is a helluva drug.

I think you're right about Zuckerberg as a young leader. Start making money and you'll start wanting more and more just to see how much you can make.


> Imagine a future where every time you want to electronically communicate with someone you have to spend mental energy filtering out ads.

There should be a law that says that ads should be clearly identifiable as such. Like: they should be placed in a frame with the word "advertisement" on top of them. (Coincidentally, this would also make it easy for ad-blockers to remove them).


I think it's sad, given how smart he is, that he is unaware of this dark side of connection and being connected and of facebook in general. So he's either to wrapped up in himself to realise, or at least acknowledge the dark side of what he's doing. Or even worse, he knows, and is aware but just continues to do so


I’d be really interested to hear about what MZ is like from people who’ve worked closely with him. All of his public pronouncements seem to lack reflection imo (eg that letter to his child), but perhaps he’s limited by what he can say.



Zuckerberg is almost single-handedly responsible for the downward spiral that the internet has been on ever since Facebook. He has never respected anybody's privacy or rights. The internet would have been a better place without him. He's to the internet what Trump is to the White House... Just ignores all norms and unwritten rules for his own profit, and causes permanent damage in the process.


The only solution is to take the unwritten rules and write them down


I am on vacation in India right now and real life here seems to be exactly like the vision you are outlining... just walk around the city and every few meters people are offering you goods that you never knew existed... there is a fine line between useful offerings (e.g., a market) and herassment in every day life.

For me it’s all about keeping the choice with the user and away from the seller. To my mind, there should be strong evidence that you are really looking for something before sellers are able to interrupt/contact you.


Isn't it it equivalent of every road having ads, which is basically the case in the US (billboards)?

A tollbooth is an access fee, which is the opposite model of ad revenue.


Isn't it it equivalent of every road having ads, which is basically the case in the US (billboards)?

Billboards are illegal in some cities and along some roads in the United States.


Bingo.

The only mass market "free, but pay at some point" model is ads. Nothing else. That is the last 10yrs of Silicon Valley and pretty much every startup today. Cause if you have a great idea and decent execution, FANG companies have so much power to enter the market and crush you, 1st mover advantage is the exception nowadays. Or at least buy you out, github is a perfect example.


I don't think the dark patterns are a surprise to anyone who has been paying attention. The machine maximizes input of human attention for the output of money.

The only thing really surprising about Facebook is how consistently well they have executed that function, and for how long they have incrementally optimized it. Zuckerberg deserves some blame/credit for that for sure.


I can't imagine he cares about the money anymore, so it must be another motivator. Maybe he believes in what he's doing, for better or worse.


He probably cares about the well being of facebook employees and his children.


The only "connecting" Mark wants is to his pocketbook.


It's good to separate the fact that he's a good leader from the fact that facebook does harm in some ways.

Hitler was a great leader too.


I don't think anybody who has bothered to read up on Hitler's leadership and management styles would agree that Hitler was actually a great leader.


>Mr. Koum, a San Jose State University dropout, grew up in Soviet-era Ukraine, where the government could track communication, and talked frequently about his commitment to privacy.

Someone said that the people who love America the most are the immigrants who has to endure the crap back in their home country. I can totally relate to this. I have lived in a country where my privacy and personal judgment didn't mean anything. The government could do whatever with your life, and people can ruin your life and kill your whole family by accusing you of a story they hear from the vines [1, 2]. Maybe [3] - not from the same country, but it is the same story.

I make a point to not have Facebook, Messenger, Instagram, Whatsapp (now) - basically anything that Zuckerberg and co. laid their hands on. I fucking hate the whole idea of any entity blatantly time and again disrespecting my privacy and judgments to advance their agenda and make money. The truth is I really have no control over what it collects from me, what it shows me, what it tells me, what it advertises to me, what it hides from me. I know if I go with it, the decision of foregoing my privacy will go back and bite me when I need it the most. It doesn't matter what they say they stand for; it doesn't matter how many of my peers are using; it doesn't matter what I miss out; it doesn't matter how weird people think I am; it doesn't matter what opportunities I will lose. I have made a decision two years ago to never consider using Facebook, and I will do my damnest to stay away from Facebook and their products and I will try my damnest to convince people to do the same.

That's how much distaste I have for Facebook and their platform as a person who had a taste of injustice. Zuck might be on top of the laws and the world and has a lot of allies, but it's not like I have not seen that and I have to fear that. And that's probably the most beautiful thing about America.

1: https://en.wikipedia.org/wiki/Nh%C3%A2n_V%C4%83n%E2%80%93Gia...

2: https://en.wikipedia.org/wiki/Land_reform_in_North_Vietnam

3: https://en.wikipedia.org/wiki/The_Lives_of_Others


Are any of your family or close friends on Facebook? It's highly likely Facebook still has data on you by cross-correlating your data with theirs and along with other data streams they purchase and de-anonymize (purchased credit history) and creating shadow profiles.

I've gotten my wife to quit FB and download her data and request deletion (GDPR), and I've quit a while back and we run facebook blockers. I still don't expect to evade FB's ongoing trawl.


That whole sentence where the WhatsApp guys have bigger desks and toilets than the Facebook guys.

Really feels like it is coming straight from a dystopian future, where the workers are kept happy with little candies, and the promise to work for a better world, while also policing each others to see who got it better next door, while the big bosses are in their towers planning their next move.

If you don't feel like a "sheep" or "token" after realizing that you are fighting over the size of a toilet or a desk, then you are deep deep into it.


That part of the article stood out for me too. These are all status issues and status is very important for human beings whether they like it or not. It seems that (despite being very well-compensated) engineers at facebook are pretty low-status - they are forced to sit all day at shitty desks in giant loud open spaces. So when whatsapp employees who were used to better working conditions arrived, it caused a good amount of culture conflict.


That’s one approach. Another is that, when you’re in an extremely fortunate position these are the sorts of things that start to be the only and biggest issues in your life.


So, I use WhatsApp as my primary source of communication.

Knowing facebook owned it always made me a little nervous, but given that it was end-to-end encrypted, I figured Facebook wasn't getting any more from me then they would from all my facebook-using-friends who would send me SMS's before.

But I'm worried about how long I can continue to use the service moving forward, which is sad as this is my main way to communicate with relatives who live in other countries. And I doubt I can convince an elderly relative to switch to Signal, as we're still working on teaching her how everything in WhatsApp works.

I also recently purchased an Oculus. I like it way more than the current Vive revisions (although I want to have a non-HTC headset and Valve Knuckles as my next VR set), but the fact that it's owned by facebook unsettles me as well.


I totally understand. You are facing the classic dilemma of privacy vs convenience. Personally, I distrusted facebook so much that I have avoided any of their products since 2013. Obviously a major win for my privacy, but it sacrificed some convenience -- then I had no real-time way to communicate with my relative in India.

In the end, you'll have to do some introspection to see if the convenience gained is worth the privacy lost. How essential is it that you communicate in real-time with your relatives? Would your relationship be substantially different if you sent email or wrote letters?


At this point, it isn't about privacy vs. convenience, it's about privacy vs. being able to have a social life. People aren't going to install a more privacy-supportive messenger just for you, they'll gradually let you drop out of their lives just like you would with a friend that you can only reach by driving to their farm 6 hours away.


People had social lives before facebook existed... it largely consisted of going places and seeing people regularly. This still works, believe it or not.


Replace convenience with whatever benefit you see most pertinent. That is your trade-off. For me, convenience is the most frequent benefit.


It's definitely tough, but a big perk of WhatsApp is also the data-calls (instead of paying for long-distance). Maybe next time I visit I can try to help convince them to check out something new, but I also ended up dragging a couple of social groups onto WhatsApp to organize events, chat, etc just by viture of it being what most people use. Especially over in Europe, it's very heavily used and not easy to replace, as it's sometimes the de-facto platform for communication.

But it's definitely a trade-off, so I at least kind of have a choice.


I find it much easier to not communicate with FB properties, period. That way I only worry that my IP tables are up to date.

I also realize other peoples' choice of family/friends make that hard for them. (My FB-addict-mother and I email, and at this point even the passive-aggressive bits about not seeing pictures has stopped.)

But if you can, I can attest that the internet is a much nicer place with a big hole where FB (and similar hostile entities) used to be.


This is why I moved to Signal after the whole brexit/us election saga. open source and not run by an advertising company


I have been hearing a lot of good things about signal... How are their servers paid for though if it's a free service?


"supported by grants and donations" according to their site.


Why is everyone doing business with a black and white strategy? On one extreme, everything is free and funded by selling user information and on the other extreme, everthing is free but funded by donation. What is wrong with 2$/year model? Everyone (I mean truly everyone) is willing to pay that.


Messaging apps, like social media services need your friends to be on the platform for it to be useful. If you start putting friction into that process then the services are instantly not useful. Everyone of your friends that doesn't join makes that thing much less useful for you.

You say "everyone" is willing to pay that. I'll tell people about an amazing app that solves their problems they are complaining about and they go and see it's a couple dollars (one time purchase) and still complain and usually don't buy it.

There will never be a popular messaging service or social network that relies on subscriptions (maybe subscriptions for additional features though)


Would agree with your sentiment, but Whatsapp itself is an example of a messaging service that relied on their 1$/year model and had around 200 million active users before it went free.


I wouldn't say they "relied" on it. It was not enforced at all (lots of people used it without paying $1) and they sold out to Facebook. It would have been interesting to see how things played out if they had stayed independent.


They started charging after they had achieved scale.


No, it cost 1$ from the very beginning on iOS.


I disagree, some very poor people most likely prefer the ads then parting with 2$. One thing people forget about advertising it is a pretty good at price discriminating. Ads to rich people are worth more than ads to poor people so advertisers can make more money from those with more money to spend while still serving everyone.


WhatsApp's $1/year charge only applied in certain (rich) countries.


Threema is doing something like that: https://threema.ch/en


I think the issue is more if you ask for any amount of money it immediately turns people off.

The process of putting in your creditcard number, entering your password for google play/paypal/etc is just enough of a barrier to go 'whatever!'.


It's hard enough to get people to switch from whatsapp when signal is free.


According to this article, somehow prosecutors were able to retrieve deleted WhatsApp messages.

https://www.straitstimes.com/singapore/courts-crime/five-ind...


So I see it mention that they were in trouble for deleting "potentiall incriminating" conversations. Are there any details or other articles that confirm the deleted messages were retrieved?


Ditto, the linked article indicates only that the parties had deleted a conversation between them at a critical moment, but not that the specific content of that conversation could be known.


I installed Signal a while back and tried to convince as many people as possible to switch. But only 7 people in my contact list have Signal installed. Even when communicating with those 7 people i tend to use WhatsApp because i tend to process all my messages at once without switching apps.


My strategy is to use it for planning birthday parties. Gets lots of people in for planning big group "secrets", and then they stick with the app afterwards.


I'm doing the same, and I only have 10 people. They happen to be my favorite 10 people, but still only 10.

I think Signal or something of that nature will be the ultimate endgame for communication systems. They're way too easy to make, they're cheap to maintain, and they're hard to monetize without being scummy. This is the perfect formula for a non-profit to step in. I think the WhatsApp founders alone could maintain a worldwide textual communication network for the rest of their lives using a small fraction of their wealth.


It seems to be inevitable that the "scummy" ones finish first. Deskop Linux could have been more popular than Windows, GIMP more popular than Photoshop and Signal more popular than WhatsApp if only they where first. But the Open Source world always lags behind when it comes to developing new stuff for ordinary consumers.


Telegram is the natural replacement for WhatsApp - very similar, but so much nicer.

I also use Signal ( and about 10 other messaging apps ) and while good, it’s a little rough around the edges and needs improvement.


Facebook having access to your contacts and maybe location too is still scary.


That's true as well. I recently deactivated my (unused for years) facebook account, but this is definitely something else to think about.


Sure it's end-to-end encrypted.. But Facebook doesn't have to get in the middle to look at your messages. Facebook is sitting at both ends, reading the messages after they are decrypted. It is already monetizing these messages and the ads are shown in Facebook instead of Whatsapp. Whether the opt-out functionality for this feature is honored properly by Facebook I'm not sure.


It's not end-to-end if Facebook can read them after they are delivered.

Facebook only have access to the metadata.


> but given that it was end-to-end encrypted, ...

FB, via the WhatsApp app, have access to your unencrypted messages before the app encrypts them and sends them on. So, there's reason to worry now that FB is in full control. I have no doubt they'll extract data from your conversations and inject targeted ads.

Edit: Am I wrong? Do they not have access to the plain text?


With regards to your edit, yes, you are wrong. And I don't mean that in a harsh way, just answering your question.

From WhatsApp themselves [0]: "WhatsApp end-to-end encryption ensures only you and the person you're communicating with can read what's sent, and nobody in between, not even WhatsApp. Your messages are secured with locks, and only the recipient and you have the special keys needed to unlock and read your messages."

[0] https://faq.whatsapp.com/en/general/28030015


That is end to end from your phone to their phone, and they are talking about 3rd parties outside the app. As your physically typing the the information into the chat message box, and before you send it, the app itself should have access to the plain text coming from the keyboard, which it then encrypts before it leaves your phone.

Similarly it needs decrypted on the other side and displayed to the other user, at which time the app again has accesd to clear text versions.

I don't believe there's any way to encrypt the message before the app sends the message / while it is displaying to the recipient


Of course, there must be plaintext at some point... I don't understand this line of reasoning.

WhatsApp tells their users and more importantly the US Gov they do not have any access to the message content itself. For this attack surface to be an issue, that would mean WhatsApp is telling a bold faced lie, secretly exfiltrating the plaintext to a 3rd party, and doing so without getting caught by any black-box auditing.


Hmm once you teach someone to use WhatsApp, another messaging app shouldn't be that hard to learn. I believe FB have been very careful to prevent misusing WhatsApp platform (or have been very good at keeping the misuse secret lol); if word got out that they were it would certainly lead to a huge exodus.


The problem is what they've learned is mostly to do with what icons (which they have no context for, never having used a computer or smartphone prior to this) they press to get certain results. And we teach them this over an audio call, so trying to learn a new one would definitely be a challenge.

But overall I would swap back to different apps were WhatsApp to be 'compromised' or misused. Discord text chat for my gaming group, Signal for some tech chats, etc.

Overall it's a shame, since I was very appreciative of the approach the Whats-App founders took. But if we're lucky, WhatsApp will remain mostly the same for a while.


For many this is probably true.

For my 84 year old neighbour, not so. He regularly pops round for help with sharing a picture on WhatsApp.

It's beyond my neighbour's ability to learn how to use WhatsApp correctly. Learning another messaging app for him is not an option.


Wrt changing to signal, just say 'it got an update' and switch it out to where the icon used to be. Provided the rest of your family switched it shouldn't be too difficult


Surely they’re getting a lot more info. Whatsapp demand complete access to your Contacts to work properly. So they know your full name and address, your bank, the names addresses and perhaps jobs of your friends and colleagues etc.


Only to send messages to your contacts; if you deny whatsapp access you can still respond to anyone that contacts you

You just can't be the first person to start the conversation


As, I say "to work properly".

I can't send a message to anyone, without giving it access to everyone. How daft is that.


How do they get bank?


maybe because they have it as a contact?


For all the rap it gets for its own crypto, I would still recommend Telegram as an alternative because of its superior UX. It shouldn’t be very difficult to move from WhatsApp to Telegram (of course, I do understand that people who are not used to technology much may have difficulties).

I wouldn’t recommend Signal to anyone who’s not paranoid about privacy and security. It still needs to improve a lot on UX, reliability and many other fronts.


signal UX is great!




Thank you for this... how is something with a paywall so upvoted, it kind of goes against the spirit of this website.



I just recently signed up for a paid WSJ account and have not regretted it one bit. Their iPad app is particularly great.


Here we are on HN with many people complaining about free* Facebook, and then also complaining about pay services too. It takes money to run a world class news organization. Either that or they can get paid in non money equivalents like "likes" or page views which make everyone but them money. Where the value is to fool someone to come to your page so you can mine their data for ads, and serve ads. To get people to subscribe to you, you have to provide more value than that.


I'd rather be surprised at how many people comment without reading the article first.


Put the url of the article into https://outline.com/ to get around most paywalls (including wsj)


You can search your way to the dozens of moderator posts about (softly) paywalled posts.


Da real MVP


"WhatsApp also negotiated for nicer bathrooms, with doors that reach the floor."

This is not a norm in silicon valley/states?


The times I have visited the US I have always been disturbed by how little privacy I feel like I have in a stall. I am sure I have made eye contact with dozens of people in US airports at a time that is not appropriate for either of us.


Europeans just need to stop being so terrified of the human body and being such prudes. /s

It's funny how Americans get endlessly bashed for being prudes about the human body, and then somehow on this topic they get bashed for not being big enough prudes about the human body.

Here's why that is: Americans simply get bashed no matter what direction they go on any subject. It's done solely to make the person doing the bashing or mocking feel good.

If the stalls went all the way to the floor, it would be decided by elitist snobs in Europe that that is prudish behavior and ridiculous because there's nothing shameful about going to the bathroom and it's a natural function of the glorious human body. It would go like this: ah those stupid Americans with their fear of the human body, and their overly private bathroom stalls. Dumb Americans are afraid to even know that there's another human in the next stall, even a 12 inch floor gap is too much, because there might be a foot over there somewhere. It's silly how uncomfortable Americans are about normal functions of the human body, they can't even tolerate a small gap in the bottom of the stalls.


What a strange thing to get angry about.


Chill out, I also hate the squat stalls in remote train stations in Italy that are three times the size they need to be leaving you feeling super exposed while trying to balance but that wasn’t the question the original commenter asked.


I have never understood why North American bathroom stalls don’t just go to the floor. Jesus Christ how much would it really cost to enable some damn privacy.


I'm torn on this one. One the one hand I would love that extra privacy.

On the other, I really value knowing if someone is in the stall next to me and how many people are in the bathroom. If the stalls extend to the ground how am I supposed to scan for legs? Someone could be hiding in there waiting to frighten me! I cannot use the bathroom until everyone has left it. Just how am I supposed to verify that some quick-footed coworker hasn't made their way in during someone's loud flush?

I cannot stomach this game of chance.


> how am I supposed to verify that some quick-footed coworker hasn't made their way in during someone's loud flush

Most places with full-coverage stall doors also have occupancy indicators on the outside - if you go in and lock the door, it changes from green to red.


I'm going to need an internal panel indicating the occupation of each stall.


How do you use the bathroom on a plane?


I don't use the bathroom on a plane. I'm at a young enough age that holding it isn't too complicated. Though it has been some time since I did a 6+ hour flight.


use an accessible bathroom that usually exist in the public spaces?


Blame the people who spend all their time worrying about what your doing in private.


I always assumed it was to make it easier to mop/clean.


The rest of the planet mostly does ok.


But maybe it is a ... wait for it... moptimization!


The norm is stalls with walls having ~12-18 inch gaps between the bottom and the floor,and 1/4-1/2 inch gaps between the edges of the door and the posts the door is hinged to. It's trivial to see someone doing their business without even trying or intending it.


I had no idea this was a thing until a french coworker mentioned it as one of the stranger things he noticed when he moved to the US. I've been to France and other countries in Europe/Asia/SAmerica but never noticed that the stall doors reached the floor.


I think it's partly practical and partly cost savings.

Shorter walls are cheaper, but it also makes it easier to clean, easier to help someone in case of an emergency, and easier to tell if the stall is occupied.


They're a $500bn company. I think that can afford an extra foot of door.


Sure, but the default is going to be for shorter doors.

Someone needs to ask for long doors in order to have them built in the US.


For some reason american bathroom stall doors don't reach the floor.

It is very weird the first time you see them coming from Europe but it seems to be the norm here


I think its to prevent people having sex in them.


is that a serious answer ??


Most US bathroom doors do not reach the floor. It is much more common in Europe. As an American, that line did come off as a somewhat exotic request.


It's not a norm in the states, no. Typical restroom stalls in the US have about 10" (25 cm) of clearance between the bottom of the door and the floor.


> "Small cultural disagreements between the two staffs also popped up, involving issues such as noise around the office and the size of WhatsApp’s desks and bathrooms, that took on greater significance as the split between the parent company and its acquisition persisted."

^^ coupled with a photo of outrageously poor open-plan office space.

This is just insane. Like, executives should be ashamed of themselves if they think developing a company culture means micromanagement of desk space and bathroom size.

I have to agree with Joel Spolsky that, when you think of things like this, it makes you start to realize that Facebook has to offer outsized salaries and RSU grants to its employees, because the culture and workspace is so poor and surveillance / micro-management oriented that in order to let yourself be embedded into a hellish workplace like that, you would require greater-than-market salary.

And frankly, the salaries aren't high enough to offset this, compared with other companies that don't turn your work life into a micromanagement panopticon, yet still pay well.


I'm a former fb employee, and to say that they "turn your work life into a micromanagement panopticon" is way off. Overall it's a great place to work as a software engineer, although it depends a lot on your team. Many employees have minor frustrations with various things like open plan offices, oversubscribed bathrooms, lack of parking, etc. I suppose there must be some employees who quit because of these sorts of issues, but I've never met any. For most people who work there it's a fantastic opportunity. From what I saw, people quit for the same reasons people quit any company: Burnout, bad relationship with direct manager, or desire to move on to something new.


This seems at odds with the photo in the OP linked article (referenced by the quote in my comment), as well as any other similar photos of what the physical work spaces are like.

I mean, it seems like indisputable evidence based on the physical structure of the work space. I don't see how there's a way to interpret photographic depictions of the actual Facebook offices in some other way.

It's like saying, "See this picture of a work space that indisputably shows it to be a grotesque panopticon? ... well, trust me, it's not a panopticon."

Is the picture a forgery or something?


I agree, the pictures you've seen on the internet definitely trump my personal experience. Thanks for setting me straight.


This blog post from Whatsapp is almost 6 years old: https://blog.whatsapp.com/245/Why-we-dont-sell-ads (it was linked to from the WSJ article)

Almost prescient is the final line:

When people ask us why we charge for WhatsApp, we say "Have you considered the alternative?"


Also they use a quote from that blog post as the title comment:

> we wanted to make something that wasn't just another ad clearinghouse


from the link

"These days companies know literally everything about you, your friends, your interests, and they use it all to sell ads."

I am not surprised there was a culture clash. I am more surprised that they sold to FB, and that it lasted so long with the difference in vision.


The clash of cultures... I prefer WhatsApp's one though.


Yup, peace and quiet with privacy in mind. Not sure what Facebook employees don't understand.


" Not sure what Facebook employees don't understand"

It's the part where What's App doesn't actually make any money and as a standalone business isn't worth a whole lot.

The issue boils down to business model.

It's really easy for WhatsApp founders to take the moral high road when he doesn't have to bother with trying to make a dime.

The WhatsApp founder is in somewhat of a hypocritical position given that his $17 Billion dollars comes from FB practices that he is ostensibly uncomfortable with.


WhatsApp was very profitable and efficiently run when they were acquired. I mean, they only had 35 employees for the world.


They were far from being profitable. They made close to no money, nobody I know was charged more than the initial fee.


Business model wise think with 1bn users an annual $1 fee would have been fine for WhatsApp. He also turned down hundreds of millions of dollars when he realized how fundamentally he disagreed with how facebook works. Prior to WhatsApp the founders had very little money.


"Business model wise think with 1bn users an annual $1 fee would have been fine for WhatsApp."

If you've worked in the mobile app business you might get that this could mean almost 0 in revenues.

People. Don't. Pay. For. Stuff.

Moreover, WhatsApp is huge in places like S. America where people don't have credit cards, or for whom $1 is even too much.

"He also turned down hundreds of millions of dollars"

He took $17 Billion and is now publicly complaining that what FB is doing is immoral. He doesn't seem to have a problem taking money from that immoral business model.


>If you've worked in the mobile app business you might get that this could mean almost 0 in revenues.

It could, but it didn't. It meant revenues in the tens of millions.


Yes, that's about right. Not much of a company, relative to the $17B he raked in because of their ad-value to FB.


Depends on how you define a company, I suppose. If it is profitable and has hundreds of millions of customers, that's a pretty significant company to me. As an alternative example, broadcast.com was sold for 5.7 billion.

I'd take continued success, hundreds of millions of happy users and a good purpose over broadcast.com.


I'd like to see how your company is doing if tens of millions of dollars of almost entirely clear profit is "not much of a company"...


they're paid to not understand it.


Me too. I hate the culture that tech-companies seem to be gravitating towards in general - gimmicks like open-plan offices, frequent parties and outings, games etc. I didn't get into software development for the perks - I did it do solve problems with software, and these companies seem to be missing the point that software development requires extended periods of focus.

I wish I could find out more about WhatsApp's culture in this respect. Something like Valve's new employee handbook[0] or Netflix's culture deck[1]. I can only really find second-hand articles referring to its culture [2]

[0] https://steamcdn-a.akamaihd.net/apps/valve/Valve_NewEmployee...

[1] https://www.slideshare.net/BarbaraGill3/netflix-culture-deck

[2] https://www.fastcompany.com/40459142/whatsapps-cofounder-on-...


> Some Facebook employees mocked WhatsApp with chants of ‘Welcome to WhatsApp—Shut up!’

Pretty sure I would, too.

Edit: This was ambiguous. I didn't mean I'd mock WhatsApp. I was agreeing with the orginal post that I'd prefer WhatsApp culture.


This is one of the weirdly recurring founder stories of 'after you sold something for good money, you don't get to tell the buyer what to do with it'.


Likewise, this is why acquisitions come with golden handcuffs and lockups.

I think everyone handled it well. They fought for what they believed in, they lost, and they chose to give up money instead of sticking around and being a pain in the ass. Facebook rightly said "we bought this and control it and here's what we want to do."


I don't think the sources for coverage like this come from Facebook.


Depends on the terms of the sale, maybe 'if you want to tell the buyer what to do with it, get that in writing, and expect the sale price to reflect term you've added, and to maybe kill the deal altogether'


There is no serious acquisition that involves you telling the buyer what to do, outside of very rare occurrences and even then under very narrow parameters.


"who pays the piper calls the tune "


Apple should port Messages app to Android and other platforms, this is a great opportunity for them to capitalize on. It is unlikely though, as the strategy is to get people to buy iPhones to get Messages.


There is already so much shame directed to the one family member that forces everyone else to use something other than iMessage. Sometimes they just get left out of conversations. Apple's taking this even further with improved photo sharing in iOS 12 (moving more families off Facebook/Instagram), and group FaceTime.

As a user I wish that these apps were widely available because I prefer them to alternatives, but as a shareholder I'm not at all upset by this. At least Apple is charging for these privacy-protecting apps, which is the most important detail about WhatsApp: it was already profitable charging users $1/year before acquisition. If Apple ever does release FaceTime and iMessage for Android I hope they charge subscription fees for both.


Yeah they’ve done a great job with the different colors. I hate it when I see those green clouds. I made some of my friends on Android message me via Signal (they refused to use WhatsApp) because I hated the green clouds so much.


Blackberry and BBM went this route already, and we know what happened to them. I think it is high time for Apple to jump the ship and get messages into Android. :)


Why? Having messages be iOS only, is working out perfectly for them.

Most iOS users get annoyed at the android users when they get green bubbles, instead of getting annoyed at Apple.

As long as that continues to be true, I don't see iMessage ever coming out for Android.


Apple has a pretty good market share and in their home market (because it's viable there, many other countries have insane prices) iMessage is compatible with Android users by SMS. This may be good enough, plus iMessage is just one of the features they sell with their devices. I doubt these cases are very comparable.


I just don’t see the "why". It would be a purely US feature, and would have limited appeal even there. iMessage on android isn’t going to sell any more iPhones, and I can’t see how it’s going to meaningfully change people’s behaviour. Everywhere else in the world just doesn’t use iMessage.


That would just be a jump from the frying pan into the fire. The real solution to all these problems lies in the use of decentralised services, e.g. XMPP+OMEMO connecting to a private server. This could be the same server as the one hosting any other privacy-sensitive services, e.g. Diaspora or GNU Social or something along those lines. It could also host a private mail server, a private "cloud" server, a private (meta-)search engine and any other services which you'd rather not have data-mined.

...and all that would fit on something like a Raspberry Pi 3B+ nowadays...


"When Facebook bought WhatsApp, it never publicly addressed how the divergent philosophies would coexist.

...

But Mr. Zuckerberg told stock analysts that he and Mr. Koum agreed that advertising wasn't the right way to make money from messaging apps.

...

Some of the employees were turned off by Facebook's campus, a bustling collection of restaurants, ice cream shops and services built to mirror Disneyland.

...

Mr. Zuckerberg wanted WhatsApp executives to add more "special features" to the app, whereas Messrs. Koum and Acton liked its original simplicity.

...

Mr. Zuckerberg and Ms. Sandberg also wanted Messrs. Koum and Acton to loosen their stance on encryption to allow more "business flexibility," according to one person familiar with the matter."

It sounds like Koum and Acton actually had some principles. Among other things, they wanted to keep the software relatively simple, instead of continuously increasing its complexity by adding "features". The article suggests others saw Acton as a "moral compass". It also suggests David Marcus president of messaging products at Facebook Inc. called his #deleteFacebook remark "low class" behaviour. How to resolve this apparent contrast?

The article suggests Sandberg reacted to the Acton tweet by called Koum instead of calling Acton. It sounds like Facebook's legal department had no leverage (e.g. a non-disparagement clause) over Acton to prevent him from sharing his true thoughts regarding Facebook Inc. He chose his principles, including the freedom to express his opinion of Facebook Inc., over the stock options he forfeited.

If these founders really did have principles, and there are ample indications that they did (not limited only to what this article discusses), then is this not admirable? Their stock, compensation and benefits packages were large enough to make most folks abandon any principles in exchange for a much higher standard of living.

It also sounds like the WhatsApp staff actually like to engage in cerebral work, hence their desire for quiet and their dislike for the "Disneyland" environment at Facebook. Is there an alternative explanation?

Perhaps the lesson here is that "culture clash" may not be so important in these types of acquisitions, where the primary asset is users. These users can be transitioned to whatever the acquiring company desires.

For example, there could be a culture clash between a proprietary software company that acquires a company that offers free source code repository services for free/open source code authors. If the founders acquire significant, life-changing wealth from the transaction and the primary asset being acquired is end users, then any clash of principles or work culture is arguably insignificant.

The analyst quoted in the article calls Koum and Acton "naive" for believing Zuckerberg would not renege on his promise not to use advertising to generate revenue. He offers the ever persuasive cliche that Facebook is "not a charity".

Was WhatsApp a "charity"? It was covering its own expenses and turning a profit at the time of acquisition. It was saving millions of people money on SMS and voice calls. When it sold, it generated a lot of wealth for its investors. Was it not a success. By all accounts it never took money from advertisers.

While Facebook, like a few other oversized ad-financed tech companies, has the purchasing power to acquire any emerging competitor for users' attention, one could argue that WhatsApp had something Facebook does not: principles.

From the article it does not sound like acquring WhatsApp's principles was ever part of the deal.


I have a question that the article doesn’t answer. If the original founders left because of disagreements on advertising as the monetization model for WhatsApp, are they still holding on to Facebook stock for their $3 billion and $9 billion net worth (respectively)? Or have they sold those since those shares are valued because of the advertising that Facebook pushes? The answer to this would say a lot about their claimed commitment to privacy and their stance against ads.

My next point is a prediction. WhatsApp will remove end to end encryption as the default very soon. With Facebook wanting to grow its revenues and profits (like most other companies), this is too attractive to let it stay as it has been for the last few years. At least some WhatsApp employees seem to have some kind of a moral compass on this topic, and I’d expect several of them to leave when this change is announced later this year or early next year.


> When Mr. Acton departed Facebook, he forfeited about $900 million in potential stock awards, according to people familiar with the matter. Mr. Koum is expected to officially depart in mid-August, in which case he would leave behind more than two million unvested shares worth about $400 million at Facebook’s current stock price. Both men would have received all their remaining shares had they stayed until this November, when their contracts end.

4 billion dollars of the 22 billion was cash. The remaining 18 billion was in Facebook stock[1]. Most likely, they still have stock in Facebook.

[1] https://www.investopedia.com/articles/investing/032515/whats...


I see why he wouldn't agree even with the least intrusive advertising place. Because it's just a slippery slope from there. That starting point can be used in conversations to leverage the 'advertising model' further, and we can end up with another facebook, easily.


So did he honestly believe FB would just continue to provide WhatsApp to the world for free, even ad-free, after spending $22bn? Doesn’t sound like it:

> Messrs. Koum and Acton also negotiated an unusual clause in their contracts that said if Facebook insisted on making any “additional monetization initiatives” such as advertising in the app, it could give the executives “good reason” to leave and cause an acceleration of stock awards that hadn’t vested…


Whatsapp is kind of a competitive failure.

Successful social media platforms launched after Facebook: -

Successful video platforms after YouTube: -

Successful Mobile chat platforms after Whatsapp: - Viber - Line - Wechat - Telegram - Snapchat


Whatsapp's key to sucess was its most simple, and most multi platform design among all competitors. It worked on all phones ranging from S40 to the most modern OS, and it was the one who invented the concept of no username/account/manually adding contacts/password login..., but just a phone number and you're ready to go. Whatsapp has a very clean interface, ad free, also very efficient messaging delivery. You don't only compete on who's first, but who does it better. Apple hasn't been first in anything since the invention of the iPhone, but they are still successful in this domain.


Facebook should really be split up. WhatsApp would have been such a great alternative to Facebook now - but with that acquisition the consumers are really the ones on the loosing end.


If you're getting a paywall as I am, try accessing via Google—just search for the title. Or if you like it on image format: https://i.imgur.com/BzSEEHkg.jpg (it was originally a higher resolution png).

It seems that the mirror posted here in the comments is somehow incomplete.


I kind of have to wonder what Jan Koum and Brian Acton were thinking (OK, I don't really wonder - they got paid billions of dollars, who wouldn't do it).

But, of course, if you sell a company for billions of dollars, there is the obvious expectation that within some time frame your company will earn revenue and profit to support that valuation. You can't complain "they're adding ads!" unless you have a credible solution for somehow bringing in billions of dollars otherwise, and the WhatsApp founders didn't.


> You can't complain "they're adding ads!" unless you have a credible solution for somehow bringing in billions of dollars otherwise, and the WhatsApp founders didn't

What about business features? Pretty much every business in my country advertises a Whatsapp number, from large companies to mom-and-pops. People contact them over Whatsapp to ask questions, make complaints, order stuff, everything. I can't believe Facebook is unable to monetize that.

It seems to me that Facebook is severely biased towards ads because they already have a platform and it's a market they obviously know well. That doesn't mean ads are the only way to make money.


Every company I've worked for wants an official WhatsApp business API.

And apparently that's what they proposed to Sandberg, according to the article, but the financial projections were nowhere near what ads would bring.


I think they are already working in that direction I last checked. https://www.whatsapp.com/business/

I liked the business app especially for shortcuts, auto-replies and other stuffs. But yes, official APIs is deal-breaker.

NOTE: Many applications and websites somehow are already using custom APIs (or something). Ex. Airlines sending booking details as WhatsApp message, flight/bus status and so on.


Yes, the custom APIs exist but are very hacky.

I work for one of the largest travel groups, I'm actually working on flight notifications, and they don't want to go there - no idea how other airlines or travel groups do it.


Ha think about all of the surface area on Facebook employees faces/arms that you could tattoo advertising on. I wonder if they have considered the financial opportunity cost there?


It’s just a matter of time. ;)


They mention it in the article:

> None of the proposals were as lucrative as Facebook’s ad-based model. “Well, that doesn’t scale,” Ms. Sandberg told the WhatsApp executives of their proposals, according to a person familiar with the matter.

I think it's partly a self-selection problem, where the companies which use the service don't have enough revenue to contact their customers through dedicated channels. If you try to monetize this, then most companies just leave because those who could pay already have such channels to customers.

It's the same problem with offering users to pay for an ad and tracking free facebook. Those users who would pay for facebook are exactly the ones you want to show ads to, whereas the others are uninteresting revenue wise either way.


> the companies which use the service don't have enough revenue to contact their customers through dedicated channels. If you try to monetize this, then most companies just leave because those who could pay already have such channels to customers

I'm not sure that's true about the companies which use Whatsapp. They are not using Whatsapp because they can't afford anything else. They're using it because the clients use it. In a large part of the world, everyone uses Whatsapp for everything. Companies go out of their way to support clients via Whatsapp - they even pay for shady unofficial APIs implemented by third parties.

A company unable to afford "Whatsapp Business" probably doesn't need it anyway. They can just continue using regular Whatsapp. No need to force them to use the paid version.

Some of the use cases for Whatsapp Business:

- Customer service.

- Product listings.

- Orders and delivery.

- Knowledge base.

- Notifications (flight status, tickets, etc).

- Promotions.

A lot of these would be attractive for large companies.


So they would have to set the price as high as the high-value ad-viewers are worth - I don't see why it wouldn't work.


That doesn't scale nearly to the $20 billion they were bought at. Yelp, which has a similar business model to what you quoted, and is more essential to businesses than WhatsApp, only has a market cap of $3.6 billion.


I'm not sure you understand how popular Whatsapp is outside the US. No one in my country has heard of Yelp (201 million population). Everyone uses Whatsapp daily. Whatsapp has 1.5 billion active users.


Part of the problem is that such customers are not as valuable as U.S. customers :(

You see it on the ads side as well, ads to U.S. or European customers can pay 10 times as much as an ad to a Latin American.


Yeah, but if we're going by a business features monetization model, what would matter is the number of businesses that are signed up, not the number of users.


I agree. My point is that a large number of businesses are likely to sign up because the service has a large number of users.


Lotta smart people at Facebook, I imagine they've looked at this and have come to the conclusion that it's not lucrative as you think.


> You can't complain "they're adding ads!"

FTFA Facebook promised not to put ads on WhatsApp.

The terms of the acquisition agreement require accelerated vesting of incentive comp to Koum and Acton if Facebook renege on their promise.


and yet:

>>>Mr. Acton initiated the clause in his contract allowing for early vesting of his shares. But Facebook’s legal team threatened a fight, so Mr. Acton, already worth more than $3 billion, left it alone, according to people familiar with the matter.

Turns out facebook sucks as a company.


hmm, i think no. once you sell th company you only have to fulfill your acquisition agreement. in some cases that may be revenue targets but not always. do we know exactly what they needed to do to keep their jobs post acquire? i don’t think it’s obvious


The ultimate goal of software companies is to control as much "platform space" as possible. This is mainly due to the way we treat virtual properties legally, and it only becomes truer as e.g. APIs are ruled copyrightable.

It's not implausible to believe that a big tech co would be interested in acquiring a platform defensively and/or for control over the platform ecosystem.


When they sold their business it was not their responsibility to make sure the buyer was getting a good deal. It was the responsibility of the buyer to honor the agreements they made as part of the purchase.


I was happy paying a subscription fee to whatsapp when it was still a thing. I dont know if facebook has ever made money off of ads shown to me.

Same goes with google and the subscription I pay for google music.


People think they generate no revenue via ads, but you do, all of you are.

Best ads on Facebook are brand ads and these work on your subconscious. Unlike Google Search that shows immediate intent, you don’t have an immediate need while browsing FB. Sure there’s the occasional impulse buy for some iPhone case or jewelry you don’t need, but the big companies don’t care for your clicks. E.g. what are the default beverages people buy when organizing an event? Beer and Coke and it’s not a coincidence or because there aren’t better choices.

In other words, as long as you look at ads, your buying choices get influenced by them, so you are generating revenue for pay-per-view ads, even if you never clicked on one.

I don’t mind seeing ads though, as long as they are tasteful. What I mind is the tracking and in that regard Facebook is among the worst.


When you go public that’s what happens, fb isn’t amazon where it finds new ways to grow, they saturated their user base due to geo and political factors, so investors need him to justify the stock price multiple.


I want to side with the Whatsapp founders but really what did you expect?


Irrespective of all these, still FB stocks doing well (or surpassing the past performance). Anyone noticed that?!!


The source of Facebook's revenue is its ad network, not the use of its social networking capabilities at facebook.com

If you visit a news site and click on an ad that was shown through Facebook's ad network, then they receive money. Importantly, you don't need to use facebook.com that much, only enough for Facebook to start tracking you.

If a Facebook user logs into their account just once, then the Facebook tracking cookie will log their visits to other sites in the ad network, which is the second largest network next to Google's. If they click on an ad, then Facebook receives revenue -- it isn't necessary for the user to be using Facebook in order for Facebook to receive money.


"The best minds of my generation are thinking about how to make people click ads." --Jeff Hammerbacher


Smoked meat... brought to you by “Sweet Baby Rays”


If you sell your soul to the devil don't be surprised he comes to collect it...



Is this a mirror, or some kind of summary. If this is a mirror, wow the article is very poorly edited. Seems like this isn't something so breaking they couldn't spend an extra couple of hours on it.

It's a bit stilted as well, which doesn't seem like it would be fixed in editing. I didn't realize WSJ articles were of such low quality. I guess because I have never gotten through the paywall. ;)


Those pesky paywalls.


a[href^="https://www.wsj.com"] { text-decoration: line-through; }


> When Mr. Acton departed Facebook, he forfeited about $900 million in potential stock awards, according to people familiar with the matter. Mr. Koum is expected to officially depart in mid-August, in which case he would leave behind more than two million unvested shares worth about $400 million at Facebook’s current stock price. Both men would have received all their remaining shares had they stayed until this November, when their contracts end.

I cannot believe this. Seriously, I think this article is bs.


Giving up $400 mil for 3 months? I mean I know they're loaded either way but come on...


I would guess there was some negotiation we don't know about, and that's why they're giving up some money.


At some point don't you think you just have enough? What's another $400 million in the bank at that point? I mean maybe you could put that towards causes you believe in, but that's kind of the only argument I see for staying.

The definition of being rich in my mind is the very concept of being able to walk away from that kind of money for your own sanity.


$400 million could help a lot of sick and hungry people. I'd dig ditches by hand for 3 months to be able to give that money to Doctors Without Borders.


Dig ditches sure. Do work that you fundamentally disagree with though? I mean where do your principles come in to the work you are doing? You choose not to rob banks to support DWB, so you have a line you yourself aren't willing to cross.

I don't begrudge him one bit for his decision.


Exactly. Even if you don't want it for yourself you could at least milk Facebook for some good purpose. But as I said in an earlier comment, there must have been some negotiation between them and FB


Sure, but I think about it this way: every cent you can take away from Facebook is a cent they can't spend on more spying.

They left and now Facebook is gonna do it anyways and is gonna cost them 400 million less.


$400 million is still a lot when you're just barely a billionaire.


If you're worth $9 billion you might make different decisions.


Right click on link --> open in private mode to avoid paywall


This does not work for the WSJ


Did you try it? Worked for me in Firefox 60


Chrome 67 incognito: https://imgur.com/a/1uVotPo


Google article title.


> Google article title.

Oddly, I've had better results doing that with DuckDuckGo than Google.


does this provide revenue to the journalists that wrote this article?


Given that I was charged for a trial subscription that they wouldn't cancel before the charge, I hope they lose all of their revenue.


The page is still full of ads so I imagine yes it does


From the WSJ subscription FAQ:

When can I cancel?

You may change or cancel your subscription at any time. To change or cancel your subscription, please contact Customer Service at 1-(800)-JOURNAL (568-7625) or 609-514-0870. We do not accept cancellations by mail, email, or by any other means.

With those terms, they can all starve for all I care.


Have you ever called to cancel the WSJ? I have stopped the WSJ three times and the FT twice (same phone service.) It’s easy to do. They will make a retention offer but will not do things like hang up on you, require you to have moved out of your area, make you wait, etc.

Of course I prefer self-service cancellation to be an option, but if the personal service route is handled well, it’s a small negative in my book, not a dealbreaker.


I have tried to cancel the WSJ before and they totally give you the runaround. It's not as bad as other services (e.g. Comcast), but it's 100% of the reason I won't sign up for another subscription.


If you are from outside the USA, those phone numbers are not free. So it actually costs money to cancel, if they even accept payment options outside the USA?


Are you in one f these countries? I would venture most of their subscribers can make a domestic call after reading the list on the support page. https://customercenter.wsj.com/contact


You're nice to them, but I maintain this is lack of respect for the customer. This is 2018 and we have the internet for such processes that can be automated, not 1965. Perhaps they wouldn't need to make retention offers if they didn't have to pay the staff that makes the retention offers? Bonus, I'm not in the US so that number is an international call for me.

Besides, subscriptions are only useful if you actually read WSJ regularly. I only click on some, not all, the articles that are linked here on HN. This bit of drama looked interesting, but most of the time I don't even circumvent the paywall, I close the page immediately.


I didn’t downvote you. You have a point about the international call. Edit: actually, they seem to have a different phone number for many countries. Is the country you live in covered? How is the phone service quality if you make a test call? https://customercenter.wsj.com/contact

I liked my WSJ subscription and it really helped me at my first job out of college. It was the print subscription and I’d supplement by reading their blogs online.


Oh wait.

>They will make a retention offer but will not do things like hang up on you, REQUIRE YOU TO HAVE MOVED OUT OF YOUR AREA

You're stating this like it's a normal requirement for canceling subscriptions. I understand you're praising WSJ for not doing that but...

Do you accept treatment like this in the US? Are press subscriptions a lifetime commitment over there? Do I need to indenture my firstborn to any magazine that I subscribe to as well?


I live in the US and have never had any of the experiences you're mentioning. The conditions the person you replied to mentioned are not typical here.


Give me a break. The WSJ cancellation is absolute crap (I've done it twice before and it's a pain in the ass because I have to call during business hours) but the Guardian is way worse.

This is common practice outside the US too. Which newspapers have you tried to cancel?


It's pretty normal for utility subscriptions, since they can use the fact that you're moving to upsell you on their service elsewhere or a partner's.


No, I don’t accept treatment like that when possible — I listed things that Comcast has done to me on the phone. :)




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