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Why is it so hard for someone to make a simple WhatsApp competitor with the same business model as the pre-facebook WhatsApp? It was build by just a few people

Why is it so hard for someone to make a simple WhatsApp competitor with the same business model as the pre-facebook WhatsApp? It was build by just a few people 10 freakin years ago. I wish people valued their privacy higher than $1 a year but I guess many don't.

goldcd 6y ago
That was Signal - he took the Facebook money and made Signal with it.
- mmmmmbop 6y ago
  And now he's selling his reputation using an ICO scam.
paxys 6y ago
WhatsApp never had a real business model. Its peak revenue, disclosed by Facebook at the time of acquisition, was ~$1.5 million/year, and this was when they had 500 million active users. It was always running on VC cash.
- mwambua 6y ago
  > Its peak revenue, disclosed by Facebook at the time of acquisition, was ~$1.5 million/year Not sure where you got that number, but in 2013 (before aquisition) they reported ~$10 million in revenue. (https://www.sec.gov/Archives/edgar/data/1326801/000132680114000047/exhibit991auditedwhatsappi.htm https://www.sec.gov/Archives/edgar/data/1326801/000132680114...) They brought in $15 million in the first half of 2014. (https://www.sec.gov/Archives/edgar/data/1326801/000132680114000047/exhibit992unauditedwhatsap.htm https://www.sec.gov/Archives/edgar/data/1326801/000132680114...) They only had 55 employees at acquisition. They might not have become a unicorn... but there most definitely was a path to profitability.
  - paxys 6y ago
    This was my source - https://www.investopedia.com/articles/personal-finance/040915/how-whatsapp-makes-money.asp https://www.investopedia.com/articles/personal-finance/04091... (which points to that same document but somehow draws a different conclusion). Also that document shows a net loss of $230 million in that same period, so not exactly on a strong path to profitability.
    - jonplackett 6y ago
      does show though that if they could get all 500 million to pay just that $1 a year, they've got $270 million profit.
      - paxys 6y ago
        - 30% goes straight to Apple/Google. - A large chunk of the world (especially people in developing countries) will be unwilling to pay anything more than $0. - Even if they want to pay, most of those users won't have a payment method set up. How many of their 2 billion+ users have a credit card or even a bank account?
    - mwambua 6y ago
      Thanks! Looks like they link Facebook's 10Q filing. Can't tell how they arrived at the number though. I agree that their losses were surprisingly high at the time... especially given how lean their engineering team and operations were supposed to be. (https://blog.whatsapp.com/1-million-is-so-2011/?lang=en https://blog.whatsapp.com/1-million-is-so-2011/?lang=en)
- frombody 6y ago
  They attempted to force people to pay $1/yr. but that backfired hard because they couldn't figure out how to do the rollout, offered nothing in return, and suffered the backlash of their mismanagement. Even just giving paid users some small extra features or a little icon by their name or something small would have been enough to get people willingly give a dollar rather than their approach of trying to charge people.
  - Aeolun 6y ago
    You think whatsapp service isn’t worth $1 per year? I was perfectly happy to pay that.
    - pentae 6y ago
      Just because you're happy to pay it doesn't mean 500 million people are all happy to pay it
    - frombody 6y ago
      Of course it was worth a dollar before it went to facebook, the problem was they didn't plan how they were going to charge people. They only charged some users, not everyone, because they couldn't figure out how to do it.. and who got charged was relatively random. Those that did get charged could just complain and the subscription fee would just go away. Value is one thing, but only charging a fraction of your customer base at what seemingly felt like random was never going to gain public acceptance. I don't even think they even had a plan for how to deal with poorer nations in Africa where the app is exremely popular.
lixtra 6y ago
There is also threema. https://threema.ch/en/ https://threema.ch/en/
- Pamar 6y ago
  Yes, a niche of a niche, but it exists. What about Keybase, though? This thread reminded me of its existence and I just renewed it on my iPhone...
dalbasal 6y ago
>> a simple WhatsApp competitor with the same business model as the pre-facebook WhatsApp. Because the business was "sell to fb," effectively. Whoever succeeds in putting together a wide network of people will face similar incentives. I suppose someone could do it Craig Newmark style, but for that a Craig Newmark needs to be CEO of a major app company. Long odds.
- paxys 6y ago
  Not a great example even otherwise considering what a cesspool Craigslist eventually became.
- busymom0 6y ago
  Was that the business model before FB offered them the deal though? If I remember right, before then, they has a $1 per year subscription?
betwixthewires 6y ago
All centralized communications and social networking platforms will fall to pressure to sell at this point, if that wasn't their intention (this seems to be the exit strategy of most startups these days). The alternatives exist, but they don't have marketing budgets. They're things like jabber, matrix, Jami, and the many ActivityPub implementations out there. We have the alternatives already. We can use them now. To me this defeatism is like jumping out of a plane with a parachute and saying "I guess there's nothing to be done now." It starts with you making the decision to use something else. It is harder because of the lock in. But there's only one way to do it.
- jonplackett 6y ago
  It's not me using it, it's all my friends and family that's the challenge. Whatsapp isn't just marketing, it was better than everything else by being super easy to use, required no sign up, looked just like text messaging so my parents liked it too. They did everything right (up until they sold it!).
  - f1refly 6y ago
    Well, what makes you think that some new company would get any users then? Whatsapp requires sign in by the way. They take your phone number for that reason.
soziawa 6y ago
Because pre-facebook WhatsApp wasn't that great. It was frequently down and didn't even use TLS. However Threema exists. It is paid up front and otherwise fairly boring: https://threema.ch/en https://threema.ch/en
Xplune13 6y ago
> It was build by just a few people 10 freakin years ago. I think this here is the key point, that it was built 10 years ago when smartphones were just catching up and general public needed one working and stable chatting app. Replicating that is not the issue here but making people switch from their "used-to" app is. Not saying that is right or wrong but I get where most of the people are coming from. These apps are now intertwined with normal lives who are either unaware or don't care about their privacy. Also making that switching harder by incorporating more popular apps together like facebook-instagram, facebook-whatsapp doesn't help either.
joking 6y ago
I actually paid for using whatsapp, but too many people prefer something free even if you are paying with your privacy. The thing is that a communication app has to be used by both parties on the conversation, and that's a huge entry barrier.
matkoniecz 6y ago
WhatsApp had far smaller competition that nowadays. Bar of what is acceptable was raised. Windows 3.1 was extremely impressive when released and got popular. Releasing equivalent of Windows 3.1 in 2021 will not be impressive or popular.

goldcd 6y ago

That was Signal - he took the Facebook money and made Signal with it.

mmmmmbop 6y ago
And now he's selling his reputation using an ICO scam.

paxys 6y ago

WhatsApp never had a real business model. Its peak revenue, disclosed by Facebook at the time of acquisition, was ~$1.5 million/year, and this was when they had 500 million active users. It was always running on VC cash.

mwambua 6y ago
> Its peak revenue, disclosed by Facebook at the time of acquisition, was ~$1.5 million/year Not sure where you got that number, but in 2013 (before aquisition) they reported ~$10 million in revenue. (https://www.sec.gov/Archives/edgar/data/1326801/000132680114000047/exhibit991auditedwhatsappi.htm https://www.sec.gov/Archives/edgar/data/1326801/000132680114...) They brought in $15 million in the first half of 2014. (https://www.sec.gov/Archives/edgar/data/1326801/000132680114000047/exhibit992unauditedwhatsap.htm https://www.sec.gov/Archives/edgar/data/1326801/000132680114...) They only had 55 employees at acquisition. They might not have become a unicorn... but there most definitely was a path to profitability.
- paxys 6y ago
  This was my source - https://www.investopedia.com/articles/personal-finance/040915/how-whatsapp-makes-money.asp https://www.investopedia.com/articles/personal-finance/04091... (which points to that same document but somehow draws a different conclusion). Also that document shows a net loss of $230 million in that same period, so not exactly on a strong path to profitability.
  - jonplackett 6y ago
    does show though that if they could get all 500 million to pay just that $1 a year, they've got $270 million profit.
    - paxys 6y ago
      - 30% goes straight to Apple/Google. - A large chunk of the world (especially people in developing countries) will be unwilling to pay anything more than $0. - Even if they want to pay, most of those users won't have a payment method set up. How many of their 2 billion+ users have a credit card or even a bank account?
  - mwambua 6y ago
    Thanks! Looks like they link Facebook's 10Q filing. Can't tell how they arrived at the number though. I agree that their losses were surprisingly high at the time... especially given how lean their engineering team and operations were supposed to be. (https://blog.whatsapp.com/1-million-is-so-2011/?lang=en https://blog.whatsapp.com/1-million-is-so-2011/?lang=en)
frombody 6y ago
They attempted to force people to pay $1/yr. but that backfired hard because they couldn't figure out how to do the rollout, offered nothing in return, and suffered the backlash of their mismanagement. Even just giving paid users some small extra features or a little icon by their name or something small would have been enough to get people willingly give a dollar rather than their approach of trying to charge people.
- Aeolun 6y ago
  You think whatsapp service isn’t worth $1 per year? I was perfectly happy to pay that.
  - pentae 6y ago
    Just because you're happy to pay it doesn't mean 500 million people are all happy to pay it
  - frombody 6y ago
    Of course it was worth a dollar before it went to facebook, the problem was they didn't plan how they were going to charge people. They only charged some users, not everyone, because they couldn't figure out how to do it.. and who got charged was relatively random. Those that did get charged could just complain and the subscription fee would just go away. Value is one thing, but only charging a fraction of your customer base at what seemingly felt like random was never going to gain public acceptance. I don't even think they even had a plan for how to deal with poorer nations in Africa where the app is exremely popular.

lixtra 6y ago

There is also threema. https://threema.ch/en/ https://threema.ch/en/

Pamar 6y ago
Yes, a niche of a niche, but it exists. What about Keybase, though? This thread reminded me of its existence and I just renewed it on my iPhone...

dalbasal 6y ago

>> a simple WhatsApp competitor with the same business model as the pre-facebook WhatsApp. Because the business was "sell to fb," effectively. Whoever succeeds in putting together a wide network of people will face similar incentives. I suppose someone could do it Craig Newmark style, but for that a Craig Newmark needs to be CEO of a major app company. Long odds.

paxys 6y ago
Not a great example even otherwise considering what a cesspool Craigslist eventually became.
busymom0 6y ago
Was that the business model before FB offered them the deal though? If I remember right, before then, they has a $1 per year subscription?

betwixthewires 6y ago

All centralized communications and social networking platforms will fall to pressure to sell at this point, if that wasn't their intention (this seems to be the exit strategy of most startups these days). The alternatives exist, but they don't have marketing budgets. They're things like jabber, matrix, Jami, and the many ActivityPub implementations out there. We have the alternatives already. We can use them now. To me this defeatism is like jumping out of a plane with a parachute and saying "I guess there's nothing to be done now." It starts with you making the decision to use something else. It is harder because of the lock in. But there's only one way to do it.

jonplackett 6y ago
It's not me using it, it's all my friends and family that's the challenge. Whatsapp isn't just marketing, it was better than everything else by being super easy to use, required no sign up, looked just like text messaging so my parents liked it too. They did everything right (up until they sold it!).
- f1refly 6y ago
  Well, what makes you think that some new company would get any users then? Whatsapp requires sign in by the way. They take your phone number for that reason.

soziawa 6y ago

Because pre-facebook WhatsApp wasn't that great. It was frequently down and didn't even use TLS. However Threema exists. It is paid up front and otherwise fairly boring: https://threema.ch/en https://threema.ch/en

Xplune13 6y ago

> It was build by just a few people 10 freakin years ago. I think this here is the key point, that it was built 10 years ago when smartphones were just catching up and general public needed one working and stable chatting app. Replicating that is not the issue here but making people switch from their "used-to" app is. Not saying that is right or wrong but I get where most of the people are coming from. These apps are now intertwined with normal lives who are either unaware or don't care about their privacy. Also making that switching harder by incorporating more popular apps together like facebook-instagram, facebook-whatsapp doesn't help either.

joking 6y ago

I actually paid for using whatsapp, but too many people prefer something free even if you are paying with your privacy. The thing is that a communication app has to be used by both parties on the conversation, and that's a huge entry barrier.

matkoniecz 6y ago

WhatsApp had far smaller competition that nowadays. Bar of what is acceptable was raised. Windows 3.1 was extremely impressive when released and got popular. Releasing equivalent of Windows 3.1 in 2021 will not be impressive or popular.