Facebook announces $1 billion acquisition of Instagram
The hot photo-sharing app Instagram has been purchased by Facebook, the largest social network on the Internet, for $1 billion in cash and stock, the two companies announced on Monday.
Less than a week after rolling out its Android app, formally iPhone app-only Instagram announced it's being bought — for $1 billion, by Facebook.
Instagram, a popular photo-sharing service that debuted at the SXSW interactive conference in 2010, had been available exclusively to iPhone users until its Android app rolled out last week. So far, though, the service hadn't developed any concrete plans for making money. The sale to Facebook makes that less important — or perhaps not important at all.
According to announcements by both companies, Facebook intends to offer Instagram as a separate, complementary service.
"We believe these are different experiences that complement each other. But in order to do this well, we need to be mindful about keeping and building on Instagram's strengths and features rather than just trying to integrate everything into Facebook," Mark Zuckerberg, Facebook's founder, wrote in a note posted to his Facebook wall.
Zuckerberg noted that this purchase is an important milestone for Facebook — the largest in its history, both in terms of the size of the community and in how much it spent, and perhaps the largest it will ever make.
"We don't plan on doing many more of these, if any at all. But providing the best photo sharing experience is one reason why so many people love Facebook and we knew it would be worth bringing these two companies together," he wrote.
Kevin Systrom, an Instagram founder and the company's CEO, said the team is "psyched to be joining Facebook." The idea, at least right now, is that the team will move together to Facebook ownership and keep working to make Instagram bigger and better, while integrating in some ways with Facebook but maintaining its own identity.
"It’s important to be clear that Instagram is not going away. We’ll be working with Facebook to evolve Instagram and build the network. We’ll continue to add new features to the product and find new ways to create a better mobile photos experience," he wrote in a blog post for the company.
He credited the app's dedicated users and talented employees for putting it in a position to be sold for so much money.