WhatsApp is now Free as it drops $1 annual subscription fee
WhatsApp, the popular instant messaging application of Facebook, has decided to do away with its annual subscription fee of $0.99, the company’s chief executive Jan Koum said Monday.
“It really doesn’t work that well in a lot of countries and we just don’t want people to think that their communications with the world will be cut off,” Mr. Koum said at the Digital Life Design (DLD) conference in Munich, Germany.
Previously, WhatsApp had been free for the first year, with the fee charged for every subsequent year. Long-term users of the iOS version were given free use for life, as thanks for paying a fee to download the app when it had a one-off charge.
The messaging service that was bought by Facebook for $19bn in 2014 has also explained the move in a blog post.
“For many years, we’ve asked some people to pay a fee for using WhatsApp after their first year,” says the WhatsApp blog post.
“As we’ve grown, we’ve found that this approach hasn’t worked well. Many WhatsApp users don’t have a debit or credit card number and they worried they’d lose access to their friends and family after their first year.
“So over the next several weeks, we’ll remove fees from the different versions of our app and WhatsApp will no longer charge you for our service,” the blog post added.
To recover the lost revenue, WhatsApp said that this year it would use the app as a way of letting people talk to businesses or organisations, who will presumably pay for the privilege.
“It’s still very early stages,” Mr. Koum said. He said the company is looking into which features would allow companies, such as American Airlines and Bank of America, to communicate efficiently with their customers through the app.
Since its launch in 2009, WhatsApp has been free of advertisements and its move to drop its subscription fee will prompt questions about its business model. But WhatsApp plans to keep its messaging service ad-free and explore other services.
In a blogpost, WhatsApp said: “People might wonder how we plan to keep WhatsApp running without subscription fees and if today’s announcement means we’re introducing third-party ads. The answer is no.
“Starting this year, we will test tools that allow you to use WhatsApp to communicate with businesses and organisations that you want to hear from.
“That could mean communicating with your bank about whether a recent transaction was fraudulent, or with an airline about a delayed flight. We all get these messages elsewhere today – through text messages and phone calls – so we want to test new tools to make this easier to do on WhatsApp, while still giving you an experience without third-party ads and spam.”
This approach is already being used by Facebook Messenger, which gives businesses the opportunity to connect with customers and even sell services, such as Uber rides, through the Facebook platform.
WhatsApp has increased in usage to over 900 million worldwide users amid the service offering cheaper messaging and voice offerings over data networks.