Two top social media marketing platforms are combining, as Facebook is acquiring Instagram for $1 billion.
"I'm excited to share the news that we've agreed to acquire Instagram and their talented team will be joining Facebook," Facebook CEO Mark Zuckerberg said in a Monday-morning statement. Zuckerberg continued:
For years, we've focused on building the best experience for sharing photos with your friends and family. Now, we'll be able to work even more closely with the Instagram team to also offer the best experiences for sharing beautiful mobile photos with people based on your interests.
We believe these are different experiences that complement each other. But in order to do this well, we need to be mindful about keeping and building on Instagram's strengths and features rather than just trying to integrate everything into Facebook.
Facebook is "committed to building and growing Instagram independently," Zuckerberg said. Instagram's connectivity to "other services beyond Facebook" is important, he added. In addition to Instagram providing its own photo-sharing service that shares photos on Facebook, Instagram also shares on Twitter, Tumblr, Flickr, Foursquare, and more. Said Zuckerberg:
This is an important milestone for Facebook because it's the first time we've ever acquired a product and company with so many users. We don't plan on doing many more of these, if any at all. But providing the best photo sharing experience is one reason why so many people love Facebook and we knew it would be worth bringing these two companies together.
Instagram confirmed the acquisition in a post on its own blog.
For users, part of the allure of Instagram is that it's lightweight and fast. If you just want to share a photo, or look at other people's shared photos, Facebook is cluttered with games and apps. But Instagram is basically just a camera app with an array of arty filters and a "Share" button.
That lightweight sharing and big, devoted user base attracts brands, including Southwest Airlines, Bergdorf, Burberry, General Electric, Gucci, Pepsi Max, Redbull, and Starbucks ("23 Brands Using Instagram and What They're Doing Right"). As a marketing tool, Instagram is limited, with no mechanism for conversion, referring fans elsewhere on the Internet to additional content, and only offering basic analytics (you can find out how many people are following your brand, and users can mark photos as favorites, and that's about it). But for branding, it's terrific; brands use it to share photos of their products, from Starbucks coffee drinks to Southwest planes to big, hairy industrial machinery produced by GE.
What do you think is the potential for brands in an Instagram-Facebook marriage? Should Facebook enhance Instagram, or would that drive away users who love it for its simplicity? Let us know.
My first reaction is "ick" because Facebook isn't quite as elegant as Instagram. I'm happy for the folks who created Instagram, this is a big boost for them. I can't help but wonder if the expansion to Android played a part in this deal. They would have been working on the paperwork before the app's release, but I still wonder.
Here's Om Malik's take on the acquisition: Here is why Facebook bought Instagram. Basically, it was scared that Instagram, with its Android launch, would outflank FB in the much-needed mobile photo market, just at a time that FB's IPO filings indicated its vulnerability in that space.
"[Instagram] cracked the code where Facebook itself failed: viral growth on mobile," said Malik.
What Facebook should do next is breathe. They've brought in-house a company that was poised to eat its lunch. They can concentrate on the IPO and continue with their plans for using that influx of money.
First, this is one of those rare instances of an Internet service I've never used.
Second, as other wags in the Twittersphere have pointed out today: Kodak goes out of business but 18-month-old Instagram, with no revenue and 6 employees, gets a billion bucks?
Third, I find the implementation of cell phone cameras just awful, and I hardly ever use my cell's camera. Now when a "record" function is added to my forthcoming Google heads-up-display reading glasses, you'll see me taking lots more pictures and videos.
Update: Okay, they've got more like 12 employees, according to NPR's Market Watch.
Facebook may have made an important move by buying out instagram. A greatly summarized tool in the area of photo-sharing which is an important area for brands. Facebook may have had the technical capability to create its own, but definitely it has bought itself goodwill, and hidden behind a different name in joining the successful android bandwagon. Looks like a win for them. For instagram i wonder if they would have been better going it alone, but now its done.
Oooh! Good point about dear old Kodak. Maybe Facebook can buy Kodak too.
Seriously, it's sad to see Kodak go and fake filter-o-rama phone app get a big payday. I didn't see anything about the Kodak announcement until your comment tonight.
- Facebook is eliminating a major biggest competitive threat. Facebook is still weak in mobile, where Instagram is powerfully strong. There was a danger peoplewould start spending more time on Instagram and less on Faceook. Facebook no longer has to care about that.
What marketers can hope for: Facebook is developing some sophisticated branding tools, such as Pages and Sponsored Stories. Marrying those with the loyal Instagram customer base is a potential win.
Personally, I think a quick lightweight network like Instagram will suffer being incorporated to a big, clunky thing like Facebook. It's yet another random body part being grafted to the Monster by a Dr. Frankenstein with a case of HADD.
@smkinoshita - Yeah, it's hard to imagine a big company buying a little one and then avoiding ruining the little one. Either Facebook will add features that users don't want, or they'll fail to update the service in some necessary fashion.
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