It was only a matter of time…
WhatsApp, WhatsApp, WhatsApp what have you done?
WhatsApp has conquered the global market and has become to the default messaging platform for teens, millennials, ministers and even cougars.
WhatsApp was created in 2009 by two former Yahoo employees, Brian Acton and Jan Koum. The app initially focused on statuses and was developed by Igor Solomennikov, who the team found through RentACoder.com. It leveraged Apple’s new push notification feature to update users’ networks with status updates.
I remember back in the day when we had BBM and SMS and when WhatsApp launched it was iPhone only and cost 99c to use. I was still in varsity and had Nokie and sent free SMS’s online and communicated through please call me’s
WhatsApp was a simple product with the simple business model — offer people a simple, fast messaging platform and charge them 99c. If a billion people download the app then the pair would make a billion dollars (give or take a few cents).
For this model to work commercially, then word of mouth marketing would be the only alternative as it would be very difficult to acquire users at less then 99c per user.
The App went on to release an Android version , By October 2011, one billion messages were being sent per day; by early 2013, WhatsApp boasted 200 million active users. That figure is impressive enough, but by the end of 2017, WhatsApp was up to 1.5 billion active monthly users.
In February 2014, Facebook moved to acquire WhatsApp for $19 billion — which remains its largest acquisition to date…
Time is money and money is time
When Facebook acquired WhatsApp there were concerns over privacy and sharing of data between the two companies, so much so that the two co-founders left the company. Whatsapp did however implement end to end encryption to alleviate some of these concerns.
Facebook is an Advertising driven business and that 2 Billion Whatsapp userbase is a very enticing prospect.
Facebook are like a kid at a candy store who is told they cant have the sweets at the candy store, to make matters worse the kid owns the candy store..
When and not if — It was always a matter of when and not if Facebook would tap into this user base and monetize it
Update terms and conditions — privacy
The instant messaging platform alerted users with a pop-up notice saying they “need to accept these updates to continue using WhatsApp”, or delete their accounts.
Users will not be able to opt-out of the new privacy policy, as its terms and conditions must be accepted to continue using the app. Users must agree to the new terms by 8 February or lose access to their chats and contacts.
WhatsApp then elaborated that this only applies to WhatsApp Business but by then it was too late, as many users had already started jumping ship
The King of Pretoria has spoken.
New entrants/challengers
WhatsApp ran without severe competition since its BBM days but over the years that has changed, some challengers have emerged like Telegram and Signal but how much do we really know about this companies?
Telegram
Telegram is a messaging app emphasizing privacy and encryption, launched in 2013. A year before Facebook acquired WhatsApp.
Telegram doesn’t make money yet, while it raised over $1.7 billion in Initial Coin Offerings throughout 2018, this was halted by the SEC in 2019.
Telegram wants to keep the app 100% free while trying to sustain its growth.
Telegram founding story
Brothers Nikolai and Pavel Durov didn’t have an easy life as entrepreneurs. Indeed, although they had launched a successful startup in Russia (their country of origin), they had to sell it and fly out from the country eventually.
Indeed, back in the early 2000s as Facebook was becoming popular, Pavel Durov heard about this social network idea. He got inspired and together with the brother, they launched in 2006, VK (formerly VKontakte). The social media app became wildly popular in Russia and Europe. Below is an image of the social media app
We must state that VKontakte does look a bit familiar..
In 2015, Pavel Durov sold a 12% stake in the social network for an estimated $300 million.
Durov had to sell his 12 percent stake to Ivan Tavrin, the CEO of major Russian mobile operator Megafon. The telco’s second-largest shareholder is Alisher Usmanov, one of Russia’s most powerful oligarchs, a man who has long been lobbying to take over VK.
In a vk post, Durov explained the circumstances that led to him leaving the company
Telegram then went on to reach a billion messages a day 15 months after launch.
How does Telegram make money?
Telegram doesn’t make money, or at least it doesn’t generate revenues, as of 2019. Durov pointed out on a blog post that he “believes in fast and secure messaging that is also 100% free.”
On the same blog, post, Telegram notes that if it were to run out of money, it might introduce “non-essential paid options” to supplement developers’ salaries.
What makes Telegram different to Whatsapp
Telegram currently has around 500 million active users. The service includes features such as “self-destructing” messages, which on top of end-to-end encryption, make it both a boon for privacy seekers and a problem for law-enforcement agencies wanting to intercept messages.
Crypto
The one thing I love and hate about Telegram are all the cyptofan boys
Telegram raised $1Billion though as ICO and it was the most eagerly anticipated ICO in History, Telegram a global platform providing some level of street-cred to the cryptocurrency space
Telegram will use its expertise in encrypted distributed data storage to create TON, a fast and inherently scalable multi-blockchain architecture. TON can be regarded as a decentralized supercomputer and value transfer system. By combining minimum transaction time with maximum security, TON can become a VISA/Mastercard alternative for the new decentralized economy.
By May 2020, US court, officially stopped the TON Blockchain project, which would have brought to the release of the Telegram-based cryptocurrency: Gram.
As a result Telegram agreed to return more than $1.2 billion to investors and to pay an $18.5 million civil penalty.
Since then Pavel Durov has been running Telegram out of pocket. In an article on Forbes in December 2020, Telegram’s founder warned the company will have to start charging for services to raise money.
Give me a Signal
When it comes to messaging, Signal is one of the best options out there. As an open-source program, Signal has some incredible features that make it ideal for anyone looking to protect their information.
How does Signal make money
Signal, however, is a non-profit organization. This lack of a business model is a significant reason why the app is so focused on privacy. Since the company isn’t trying to make money, it can exist for the sole benefit of the user.
Instead of earning a profit, Signal relies on donations to stay up and running. Also, because the program is open-sourced, developers can go in and offer patches and solutions, all without racking up a substantial bill (similar to Wikipedia or WordPress).
One average, there have only been 2–3 developers on the Signal team, and the entire team has never been bigger than 7 people.
But the $50 Million Signal got from WhatsApp’s co-founder Brian Acton in Feb 2018 is expected to help Signal increase the size of the team and their ambitions.
Signal’s developer, Whisper Systems, doesn’t operate as a business and stays afloat on government grants instead. While this stance is noble and deserves respect — there is no business angle to speak of.
Signal privacy story
- Signal uses what’s called end-to-end encryption. This means that every message is coded through the app.
- Best of all, Signal doesn’t have the key to that encryption, so the company can’t look at your messages if someone requested them.
- Even better, Signal doesn’t store any information about you — like, at all.
- When you start the program, you’re required to open up your contact list to see who else is using Signal.
- The software uses a cryptographic hash function to conceal phone numbers within your contact list, and those numbers are truncated for further protection.
- Signal also doesn’t store metadata or offer cloud storage for its users.
- The best information that it can provide to a third-party is the day that a user logged in. You can’t even see a timestamp.
- For users that value privacy above all else, the lack of a cloud-based backup means that no one can access your messages, not even you (if you lose your phone or get a new one).
Difference between Signal and WhatsApp
Both WhatsApp and signal use end-to-end encryption to encrypt data messages sent between users, both individually and in group chats.
In fact, WhatsApp uses the Signal’s Whisper Protocol, which has been developed by Signal, to provide end-to-end encryption.
Since WhatsApp uses the same open-sourced software as Signal, both messaging apps are quite similar in terms of how they encrypt user messages.
In 2016, WhatsApp started providing full encryption on all messages, including multimedia ones with pictures and video clips, which was enabled by a partnership with Signal.
On the other hand, Signal has always been using end-to-end encryption.
Signal does not store any metadata.
The only thing that Signal server stores are the last time a user connected to the server and even that information is reduced to the day in terms of precision, not the hour, a minute or the second.
One thing to keep in mind with end-to-end encryption is that it only works in the software itself.
Once the messages are outside of WhatsApp (i.e., in the cloud), anyone can hack into your account. And as we know, Apple and Google are also not exactly secretive when it comes to storing and tracking data, so backup your messages at your own risk.
Signal, on the other hand, doesn’t have this problem. You can’t store messages on your phone, although you can download and save pictures and video files.
For someone to read your messages, he or she will have to break into your phone and look at them within the app. However, there’s a way around that too.
The program comes with a feature called “disappearing messages.” This feature will delete your data based on a preset amount of time, such as five seconds or five days.
Utilizing this option can protect your messages on your device, just in case you’re worried about theft. However, you will also need to encourage your contacts to follow suit, as their devices can be potential liabilities if they don’t delete your conversations.
The others
Wire
Wire’s pitch is basically “Slack and Skype but with End-to-end encryption and no fuss.” The application is built around a subscription revenue model with different features.
- There is a streamlined free personal app that offers an excellent showcase of the platform’s possibilities.
- Then there is the Pro version (6€ monthly) with more features for a reasonable price; it can be used for groups to discuss projects and maintain confidential communication all the way through.
Wickr
Wickr is another secure messaging app whose business revenue model rides on Enterprise customers.
It is specifically designed to deal with company-wide confidential communication. The majority of Wickr’s features are tailor-made for handling sensitive information.
For example, in addition to the traditional timer, you get a shredder feature that deletes all traces of the message or file.
Threema
Threema is probably the most interesting of the bunch. It is very similar to WhatsApp in terms of positioning — secure, strictly confidential messenger.
Their main selling point is the so-called “no strings attached” policy, as the application requires no telephone number tie. This feature makes it even more anonymous than the other apps on the list.
Conclusion
There are two markets for instant messaging applications, the personal and business markets. Privacy is a concern for both with many companies and users using WhatsApp for both personal and business communication. This poses a risk with intercepted massages and Monetization of users through ads and user data.
WhatsApp operates as a platform with the users deciding how they want to use it. Those who use it for personal communication and value their privacy are jumping ship and those who use it for business communication are at a crossroads.
Telegram was built for privacy but has become the platform to use if you value secrecy, its Russian ties are concerning and its lack of revenue is even more concerning. Users could find themselves in a situation where the very Zuckerberg’s they are running away from end up buying Telegram
Signal is pound for pound better than Telegram and WhatsApp when it comes to privacy, so much so that a large corporate is using its tech.
Are there still any opportunities out there?
Yes, the enterprise market requires secure platforms like Wickr and add a sprinkle of CRM, business and personal call management and you have a winner
There could also be an opportunity in the personal instant messaging when users could be paid for the use of their data and paid to submit new data.
For me see you on the other side of the Signal
References
[2] — https://fourweekmba.com/telegram-business-model/
[4] — https://theappsolutions.com/blog/development/secure-messenger-like-signal/
