If you couldn’t grasp the significant value of mobile before, you have a pretty good benchmark now: Facebook announced it acquired Instagram today for a billion dollars.
There are a number of implications to this deal – the transference of user information, the future of the interface, the mind blowing amount of funny money passing hands – but the real story, to me, is just how valuable mobile is to the future of social media.
Facebook recognizes the shift towards mobile and wants to ensure their relevance in the space. Instagram doesn’t bring a new audience, it wouldn’t be impossible to replicate internally, and it was reportedly only valued at half of what it was purchased for - but it is worth so much to Facebook because it is a proven tool that would be an asset in house and – perhaps more importantly – a rival out of it.
Yes: Instagram posed a threat to mighty Facebook.
To see how, one just needs to look in the not-so-distant past of fellow online behemoth Google. No, I’m not talking about the Youtube acquisition so many are chirping about today. I’m referencing a move Google did NOT make: their failed attempt to purchase a stake in Facebook in 2007.
At that time, the search giant had the cash to buy into Facebook but decided against it, instead putting the resources against developing their own network from scratch. Since that decision, Facebook has grown into a true rival for Google, while Google+ has, thus far, failed to capture the imagination of its audience. Google did not yet equate social as a threat to search, but in doing so, they underestimated just how much a new platform could shift online behavior.
Facebook does not want to endure the same pitfalls as the online world swings to mobile devices. Which results in this: a billion dollar expense to position themselves in (and remove their competition from) the more agile digital space its audience is evolving towards.