More than eight years after agreeing to buy one of the world’s largest messaging apps, the company formerly known as Facebook has decided to start monetizing it.
WhatsApp, the popular messaging service of Meta, Facebook’s parent company, said Thursday it is opening commercial services to those who want to use the messaging app to power their business. It was WhatsApp’s biggest move to monetize the service, which is used by more than a billion people worldwide.
The new initiative gives business owners access to the WhatsApp Cloud Application Programming Interface, a way to build a custom dashboard on top of the WhatsApp software, making it easier for them to chat with customers and provide customer service.
“This is an important step to help more companies connect with people and help more people message the companies they want to support — big and small,” said Mark Zuckerberg, CEO of Meta, at an event that the announced new service.
WhatsApp plans to charge users based on the number of calls they make with customers per day, ranging from a fraction of a cent to over 10 cents per call, depending on the region. It also plans to offer a free tier with limited services for small businesses.
The move is Meta’s strongest signal that it wants to start monetizing meaningfully with WhatsApp, especially as it faces business challenges on several fronts. Facebook acquired WhatsApp in 2014 for $22 billion, the company’s most expensive acquisition. WhatsApp was free to use for years and cost Meta hundreds of millions of dollars to use and support.
Now making more money has become paramount. Meta’s advertising business has been hurt by Apple’s changes to the iPhone operating system, and the company lost tens of millions of users in Russia after it was banned in the country. The war in Ukraine has also disrupted some of Meta’s advertising activities.
In addition, Meta is navigating a difficult transition to become a “metaverse” company that provides people with immersive digital experiences. In February, a quarter of the company’s market value – more than $230 billion – was wiped out after a dismal earnings report.
WhatsApp has historically been hesitant to monetize its service. The company’s founders swore off ads on the app, and after the idea of charging each user $1 per year to use the service, Facebook executives found the idea too anemic and difficult to scale.
In 2018, the founders of WhatsApp left the door. Mr. Zuckerberg announced a plan to merge all messaging services on the apps he owns – WhatsApp, Messenger and Instagram. The company made changes that allowed Facebook to better understand how people use WhatsApp. WhatsApp claims none of these changes were used for ad tracking.
At the same time, WhatsApp’s reach continued to expand globally, embraced by millions of users in Brazil and South America, as well as the Middle East and much of the European Union.
Many of them were small and medium-sized businesses that used WhatsApp for free to talk to customers. But the experience, WhatsApp said, was clunky and sometimes difficult to navigate, and wasn’t designed with business services in mind.
WhatsApp’s new product should provide an answer to such problems and can make it easier for those companies to communicate with their customers through the app. Cloud hosting services are provided free of charge to companies using the Cloud API.
Mr. Zuckerberg said more than a billion users connect with businesses each week through Meta’s messaging services, and the new product would make it easier for businesses and customers.
“Today, most of us use our feeds to discover interesting content and stay informed,” Mr. Zuckerberg said at the event. “But for deeper levels of interaction, messaging has become the center of our digital lives.”