Facebook Inc (NASDAQ:FB) is trying to avoid problems with antitrust laws. This is why the social media giant recently asked Europe-based watchdogs to look closer into the WhatsApp deal.
Why the search giant doesn’t want to take risks
Facebook Inc (NASDAQ:FB) spent a total of $19 billion to acquire the popular messaging app, and it doesn’t want to take any risks. The company already volunteered to go to the European Commission. There have been numerous concerns regarding laws that prevent companies from taking over the market. It is true that Europe’s telecom companies are very aware of Facebook’s deal, as it could affect them directly. WhatsApp provides provides free and cheap messaging services, whereas cell phone carriers charge for SMS messaging.
The decline of SMS texting
Just last year, the overall number of text messages dropped in the United Kingdom. Many experts placed blame on WhatsApp. Deloitte analysts predict that the number will continue to decline. uSwitch telecom expert Ernest Doku added, “The explosion in popularity of smartphones has changed the way we communicate, connect and gather information, exposing the limitations of the humble text message. “It’s no coincidence that 95 percent of mobile phone contracts are now offering unlimited texts, while data often comes at a premium — you can’t even give text messages away. We’re already witnessing the slow death of the landline, and Deloitte’s research shows the text message isn’t far behind.”
Other privacy groups have expressed their concern over the deal. Two groups even filed official complaints with the Federal Trade Commission. An official complaint claims the merger goes against the constant decree initially issued three years ago.
WhatsApp is the most popular messaging application with half a billion users and 64 billion messages sent every day. There are alternatives out there that are just as good but not quite as popular as WhatsApp.