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How do companies like whatsapp and hike earn money? How actually the Internet we use to to operate them will be actually converted into money??

  • 4
    For free apps, the answer is usually through ads or that they don't & are burning through funding in hopes of being bought out – VBCPP Jul 19 '14 at 19:41
  • Okay ... i never ever saw any ads on whatsapp – user250385 Jul 19 '14 at 19:50
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    @user250385 WhatsApp was bought out by Facebook. – littleadv Jul 19 '14 at 22:08
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    Whatsapp is not free, you have to pay after using it for a year. – Michael Borgwardt Jul 21 '14 at 12:39
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    If you find yourself not paying for a good, you are the good that is being sold. – Matthew Nov 4 '14 at 18:16
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In the case of WhatsApp they probably use revenue from the apple affiliate program, this is how it works:

After you sign up and are accepted you can generate links. When someone clicks on the link a cookie is installed on their iDevice, this cookie attributes all purchaces generated to the owner of the affiliate link for the life of the cookie (24 hours). The owner will then recive a 7% commission on those purchaces.

10

It's all about the data

A lot of modern social apps (and non social apps) do not generate any ad based revenue. They do however collect a lot of data that is valuable to them or other companies. Think about Microsoft buying Skype or Facebook buying Instagram. Having these services allows the purchasing company to have data that they can then use to build other targeted products.

That's not to say that every start up has the same exit strategy (hoping to get bought out). Many startups have one or two founders who tend to get lucrative offers from industry to build similar or more tailored versions of the same product.

Remember that for every startup you see get famous and turn in to a bigger entity, there are several others who had potential but never made it big (and those that invested in them lost out).

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    As far as I know, WhatsApp is using end to end encryption so what useful data they could already 'collect' about a person? Maybe the data could include what groups is a person member in but I doubt that this data worth 19 billion $ – BornToCode Feb 6 at 10:43
  • @BornToCode Chances are it didn't when this question and answer were written (back in 2014) – glglgl Aug 9 at 9:49
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Whatsapp Application is either free or a paid application for iOS users, depending on the region. In India they charge $1 at the time of downloading the application. In the US, it's free for the first year, and then a $1 per year subscription (though the initial app download is free).

This is one of their revenue sources which I know of.

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Hike is currently not earning but actually investing it into the app to achieve goals of their long term strategy. Their motive is to make hike #1 messenging app and until that it "WILL REMAIN FREE" but once they achieve that, then like WhatsApp, developers will make hike paid too or atleast you have to pay a small price to use hike. Imagine if hike would have been a paid app or you would have to pay money immediately after yor download hike. Would you have paid the money when you had better alternatives or had no friends on hike?

Whatsapp earns money by charging people who use WhatsApp services.

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Actually; you may find the answer on WhatsApp blog itself

http://blog.whatsapp.com/245/Why-we-dont-sell-ads

  • I see why they don't want to give ads, but I also don't see how they make money, based on this answer – Canadian Luke REINSTATE MONICA Jan 14 '15 at 22:18
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There must be the companies tieup with the internet provider network like Airtel, docomo,idea etc.for which they charge it from the user of that particular social network and some percentage where distributed among them.

protected by Community Jan 14 '15 at 13:13

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