$1 billion price tag for rival social network
A couple of weeks back, it was a very popular iOS-only photo sharing app. Then last week, it also became a very popular Android app too, bringing in potentially millions more users in the process. Now, Instagram has become a very expensive purchase for Facebook.
The price of that purchase is $1bn in stocks and cash, which is around £629m. Not a bad day's work for a company with just 13 employees and one product - an app – to its name. If that doesn't inspire you to look into creating your own apps, pretty much nothing will. Actually, it's more than a day's work, but as Instagram only launched in October 2010, we're still talking a very short time period.
Very good news for the people behind Instagram, but what about us users? Time will tell on that one, although Facebook's chief executive Mark Zuckerberg has pledged to continue to develop Instagram as a separate brand rather than making Instagram just another offshoot of the Facebook empire. It should also remain free to use for now.
Writing on his Facebook page, he said: 'We think the fact that Instagram is connected to other services beyond Facebook is an important part of the experience. We plan on keeping features like the ability to post to other social networks, the ability to not share your Instagrams on Facebook if you want, and the ability to have followers and follow people separately from your friends on Facebook.'
He added: 'This is an important milestone for Facebook because it's the first time we've ever acquired a product and company with so many users. We don't plan on doing many more of these, if any at all.'
With the launch of the Android app last week, Instagram suddenly became big business, with one million users each day being added to the service. Facebook might well have moved now before others saw the same potential. It also means a rival social network is no longer a rival.
While Facebook has been quick to reassure users about the service, there are still some unanswered questions. The company has paid out a huge amount of money and as a business, the worry is that Facebook will want to monetise the app at some point. Ads, premium filters or a premium product, all are possible. Although changes look unlikely for the forseeable future.