Facebook is buying the Instagram app for a billion dollars.
April 10, 2012– Facebook, on Monday, agreed to purchase Instagram the photo-share company for a reported $1 billion. It is the largest acquisition of any kind for the social network. It looks on the surface as a great deal of money to purchase a start-up company that has very little chance of making money and just a few employees. However, in today’s business world a lack of a good business plan does not always take away from the excitement of new hot upstarts in the tech world.
Instagram allows users to share photos taken on mobile devices. The app contains filters that change photos, making them look similar to ones taken back in the 1970s or via a Polaroid instant camera.
In just a little over a year, the company has attracted a very large loyal user base that exceeds 30 million. In 2011, it was chosen by Apple as the iPhone App of the Year. Facebook can afford the price tag, as it is getting ready for its IPO that quite possibly would value the social network at over $100 billion.
Many analysts have said that once Facebook has their IPO they can make sure no one gets in their way as they can buy anyone that happens to try to get in their way. By Facebook purchasing Instagram, it eliminates a potential rival and gives the company a technology that is becoming more and more popular in the marketplace.