Article title: Snapchat & Yahoo: A Match made in Tech Heaven?
Username of writer: Writergrl
Article keywords: Snapchat
Article body:
Christmas seems to have come early for Snapchat this year. Yahoo has apparently decided to invest in the popular mobile messaging application, Snapchat, though there are many doubts as to whether yahoo will profit from this venture or not.
After turning down the social media giant Facebook with its $3 Billion dollar acquisition offer, and Google, Snapchat seems to have found a worthy investor in Yahoo which has decided to invest a total of $20 billion into the application, rounding off Snapchat’s total market value to a whopping 10 billion dollars.
Serious money, we say!
For those who don’t know, Snapchat is basically a photo messaging application that apart from photographs, lets you send texts and videos to other users as well. The users can set a particular time as to how long the recipients would be able to view their message and after the time is up, the message is hidden from the recipient and deleted from Snapchat’s servers as well.
And now Yahoo seems interested in this highly popular picture-&-text app.
Yahoo had previously invested in Alibaba and bought a 40% stake in the company for a $1 billion and after selling a part of the stake, ended up earning $9 billion for it. Maybe yahoo is looking to create the same kind of a profit by investing in Snapchat at this time – who knows? Yahoo and Snapchat have apparently refused to comment on this topic.
Having bought the mobile application, MessageMe, only last week, Yahoo’s CEO, Marissa Mayer seems to be on an acquisition spree. It seems a little befuddling to some that Yahoo might want to invest in Snapchat, specially seeing that, though it is very popular among youngsters, it does not bring in any revenue. Also, the app’s technology isn’t really difficult to copy either, and as the messages are temporary, it can’t even provide marketing insights into the user’s interactions.
Snapchat is clearly no Alibaba.
Ms Mayer, though is determined to prove that the turnaround will be profitable, and wants to start shifting her focus more on mobile, social and video. She was also successful in acquiring the hugely popular blogging platform – Tumblr last year for about $1 billion. Rumor has it that Yahoo might even end up investing in their online rival – AOL – making at least one of their prominent investors happy.
Though Snapchat has caught the fancy of a whole number of people, we have yet to see how the CEO, Evan Spiegel, monetizes all the user-generated content that flows back and forth through the app.
The fact that, in the beginning Snapchat was used for sexting and providing peepshows doesn’t really help generate much faith in the investors of yahoo. Though no wonder Snapchat has come a long way from those days, we have to wait and watch if this move on behalf of the CEO of yahoo, Marisa Mayer, will prove profitable for the company or not.
And lend it some company credibility that Yahoo seems to be bent on acquiring through its myriad acquisitions and its social media buying frenzy.