Facebook appears to be backing off from its monetization strategy for WhatsApp.
The Wall Street Journal has reported that Facebook is reconsidering its plan to use WhatsApp as a revenue-generating tool:
"WhatsApp in recent months disbanded a team that had been established to find the best ways to integrate ads into the service, according to people familiar with the matter. The team’s work was then deleted from WhatsApp’s code, the people said."
This means that although WhatsApp is home to 1.5 billion users, the app won't be contributing to Facebook's total revenue anytime soon.
Facebook bought WhatsApp in 2014, to grow its global influence and given WhatsApp's popularity, Facebook could've used it to increase its overall revenue. Back then, WhatsApp was earning about $20 million p.a through charging $1 yearly subscription fee in some parts of the world, but the fee was soon removed by the company. This appeared to be a move towards Facebook's monetization plans which involved adding ads to WhatsApp.
However, introducing ads to WhatsApp would've been difficult, mainly because WhatsApp's prime focus is to ensure user security with elements like end-to-end encryption.
Debates over ad targeting even led to WhatsApp founder leaving Facebook in 2018. After his departure, it seemed that WhatsApp would introduce ads soon. And in November 2018, WhatsApp announced that it would let companies buy ads within the WhatsApp status space.
Many presentations were made to potential advertisers,
however, now it seems that Status ads are far from being added.
“For now, the focus is on features [which allow] businesses
to communicate with customers and organize those contacts, said one person familiar
with the matter," added WSJ.
This goes against the document outlined in 2016 by Mark
Zuckerberg stated Facebook’s three-step process for monetization.
WhatsApp is currently stuck on step two which is to ‘facilitate
organic business behavior on the app (free of charge)’ and given the current
situation the app won’t be moving to step 3 anytime soon which is to ‘Prove additional
avenues for businesses who are seeking to expand their reach and presence.’
