Is Facebook’s Acquisition of WhatsApp a Threat to Telcos

A cousin of mine, aged 22, can always be seen tapping fervently on his mobile. For someone sporadically glancing at this exercise, it might seem as a new generation rhythm. For others who are forcefully but passively involved in this so called music, it is a mobile-centric social paranoia that is seizing especially the young ones. The culprit is the ever increasing mobile messaging apps.

The recent announcement by social media firm Facebook about the acquisition of WhatsApp will only trigger the obsession towards real-time content sharing. It is soon turning into an emotional activity. And, such emotional activities are what marketers are increasingly trying to tap. It is also a great handle for customer engagement. Consider this; the 22-year old spends more time on his mobile than chatting with his family members staying with him. He is just one among the 70% of WhatsApp users that use its services every day. Facebook comparatively has only 61% hooked onto it every day. 

      

It is clear that social media gorillas are transitioning to the traditional mainstream industries ousting well entrenched and seemingly unshakable giants. Consider the case of telcos. The goings on hitherto indicates that they completely missed the social media phenomenon. Grappling with continued operating challenges, telcos’ rhetoric of continued innovation to create new revenue streams from analyzing user behavior is increasingly seen as yielding no outcomes. Communication tools like WhatsApp, WeChat, Viber to name a few are in fact overtaking telcos initiatives towards meaningful customer engagement.

The recent announcement by WhatsApp CEO is further damaging to telcos already waning significance in the communication ecosystem. Beginning Q2 2014, WhatsApp will enable voice within its app. And, like how the communication tools previously chipped away the once prominent SMS from telcos, there is likelihood of a threat on telcos’ voice revenues.