Instagram has become the talk of the tech town, these days. Last week, we saw the app lose its iPhone exclusivity with launch on the Android platform, along with an update and now the social networking giant Facebook bought it for a colossal $1 billion. Now, that’s a huge sum for a roughly 13-employee start-up that hasn’t generated revenue. Moreover, the Instagram app won’t turn into a Facebook exclusive app and will be available to users who don’t use or want to connect their accounts to the social site. However, we‘ve been thinking hard on why Facebook would shell out so much money over a start-up, and we came up with more than a reason why it would do so.

That's a hefty sum (Image Credit: Getty Images)

That's a hefty sum (Image Credit: Getty Images)

Photo sharing
Facebook, true to its name has become the face of people and their whereabouts. There are no goodies for guessing that the social network has become a major photo sharing site. We often click pictures thinking of making it our profile picture or for a flashy cover image, courtesy the new Timeline. Users can't wait to share pictures online through Facebook with their friends, family and acquaintances. It recently upgraded its picture viewer and the acquisition of Instagram is just another step at improving the photo sharing experience, or if we may say bringing the best photo sharing experience. 

Popularity
There are some nifty photo apps in the market, but Facebook just could not ignore the popularity that Instagram enjoyed. It was just last week that the app was launched for Android and had been a major player for only iPhone, until then. Despite its availability being limited to the iPhone exclusively until recently, the app had millions of users and was quite popular. Android users had been yearning for the app and developers tried crafting Instagram-killers. There were apps termed as Instagram for Android or Instagram-killer like the Lightbox, but seemingly, nothing could fade its popularity. Facebook knows the app has immense potential.

Facebook buys Instagram

Facebook buys Instagram

Trending mobile age
This is one of the essential reasons why Facebook emptied its pocket of that hefty sum of crisp greens over Instagram. Firstly, mobile social networking is at its peak and Instagram has been crafted for mobile users. The photo-sharing service is insanely popular among millions of iOS users, and within 24 hours 1 million Android users had downloaded the app and the number has been increasing rapidly. The app could further reach other platforms, like Windows Phone and others, sooner or later. We don't think that would take any longer. Moreover, there are roughly 100 million Facebook users and the number, here again, has been growing. This is the mobile age, and there are no second thoughts about it. People prefer using social networks on the go on their tablets and smartphones, even feature phones come loaded with social networking support these days. In a few ways, Instagram was a threat to Facebook, and the only to ward off potential future competition to its photo feature, was for Facebook to shell out that sum. 

We think eventually, if not Facebook, Instagram would have been sold out anyway. The acquisition seems a good move for the no-revenue start-up and the photosharing app developed by Kevin Systrom and Mike Krieger from Stanford University. Facebook itself started as a no-revenue service, and in the course of time has learnt to make revenue, acting as a driving force for social advertising, which has been gaining popularity slowly, yet steadily.

Publish date: April 12, 2012 9:24 am| Modified date: December 18, 2013 10:01 pm

Tags: , , , , , , , , , , , , , , ,