Facebook to Acquire Instagram for $1 Billion


Less than a week ago, Instagram was in the news for making its way to Android, pissing iPhone users off, and procuring at least one million downloads in the Google Play Store. Its had quite the busy week, but it’s not over. Facebook today announced they will soon close a deal to acquire the company and app for $1 billion in cash and stocks.

Before you guys all let out a collective sigh, Facebook claims that Instagram will continue to exist and operate separately. Of course, the last time a major social network company bought a major client and promised it would continue to operate normally is when Twitter bought TweetDeck and pretty much killed it through the lack of support.

That’s a bit of a different situation, however, as Instagram isn’t a Facebook client and does not exist as an alternative. It’s more of an “enhancement,” if you will. A “companion,” rather. For now, Facebook leaves us no reason to believe they’ll eventually force the developers behind Instagram to abandon it and work on the social network.

So there you have it. With backing from a huge company like Facebook, the small company – 13 employee are the extent of its staff – gets some security for the future, Facebook gets a new cash cow, and users get the same old Instagram. If you want the formal version of  all this let your eyes wander to the press release below.

Facebook to Acquire Instagram

MENLO PARK, CALIF. — April 9, 2012 — Facebook announced today that it has reached an agreement to acquire Instagram, a fun, popular photo-sharing app for mobile devices.

The total consideration for San Francisco-based Instagram is approximately $1 billion in a combination of cash and shares of Facebook. The transaction, which is subject to customary closing conditions, is expected to close later this quarter.

Mark Zuckerberg, founder and CEO of Facebook, posted about the transaction on his Timeline:

I’m excited to share the news that we’ve agreed to acquire Instagram and that their talented team will be joining Facebook.

For years, we’ve focused on building the best experience for sharing photos with your friends and family. Now, we’ll be able to work even more closely with the Instagram team to also offer the best experiences for sharing beautiful mobile photos with people based on your interests.

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.

That’s why we’re committed to building and growing Instagram independently. Millions of people around the world love the Instagram app and the brand associated with it, and our goal is to help spread this app and brand to even more people.

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.

These and many other features are important parts of the Instagram experience and we understand that. We will try to learn from Instagram’s experience to build similar features into our other products. At the same time, we will try to help Instagram continue to grow by using Facebook’s strong engineering team and infrastructure.

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. 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.

We’re looking forward to working with the Instagram team and to all of the great new experiences we’re going to be able to build together.

Quentyn Kennemer
The "Google Phone" sounded too awesome to pass up, so I bought a G1. The rest is history. And yes, I know my name isn't Wilson.

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  1. that’s F awesome!!!! 

    i hope it wont effect the android app.

    1. ‘affect’ the Android app. I wonder about this world sometimes…

      1. i just want the tile shift and the circle blur, just like the iphone version. 

        1. It’s funny how people sometimes respond to comments without actually replying to what the comment said.

          1. But if you don’t buy a car, how will you ever get to the beach?!?!?!

          2. get the bitch to drive you to the beach. TROLOLOLOLOLOLOLO

          3. It’s okay, I called him yesterday.

          4. let’s just hope they release it too. i am dying to try it out after i tested on my friend’s 4s. camera 360 can do it too, but it seem kind of not blur enough even tho i set it high. 

      2. tomato,tamato. It’s just a comment, not an exam.

        1. Lol. ‘Tomato, Tomato’ – you can say it differently, but it’s spelled the same. Idiot.

          1. So you just have to be THAT guy huh?

      3. to be fair, english might not be his first language.

    2. Effect is a noun. Affect is a verb. For example, you can affect moviegoers with awesome visual effects.  If you can remember this sentence and remember that A comes before E in the English alphabet just like affect is used before effect in this sentence, you should hopefully make this mistake less times in the future.

      PS I make mistakes all the time too. It’s possible you already know this. I am just trying to help.

      1. Android users are beginning to be worst d*cks than iSheep.

        1. I agree. You are a d*ck. Seriously? What problem do you have with me trying to help someone? Would it have been better I called him stupid and insulted him?

      2. While you are likely correct that he meant to use “affect” here, both effect and affect are used as both nouns and verbs.  Also, it’s not as though effect wouldn’t make sense.  They’re are two much real confusing grammatical mistakes out their.  I could care less about affect and effect :)

        1. “They’re are two much real confusing grammatical mistakes out their.” – Beautiful sentence.

          How does effect make sense in this case? In general effect is a noun and affect is a verb. Odds are that if you screw up the on rare case nobody is going to catch it.

          1. Thanks :)  “Could care less” is probably my biggest pet peeve, so I couldn’t leave it out either.  Agreed, noun vs verb IS a good rule of thumb.
            1. To cause to come into being.
            As it already exists, this wouldn’t technically be true, but “won’t effect change in the android app” would be fine, and the latter could be inferred given the informal nature of comments.
            Again, I’m not saying it was chosen OR the best word; I’m simply saying it’s not worth chastising someone over.  In my mind the battle of affect vs effect has already been lost.  Find a battle that can still be won; we may still win the war.

          2. In my defense I would not call what I did chastising. I thought rather than taking the path of ” ‘affect’ the Android app. I wonder about this world sometimes…” and make fun of them, it might be better to help them know the difference. I was trying to make the message board a more positive place. Even the end of my post was friendly. My intentions were good and a reaction to the negativity so often found on tech message boards. We tend to be a ruthless bunch with very strong and (mostly) well thought out opinions but extremely unlikely to accept views which differ in conclusions. Sorry if I appeared to be chastising the original poster. I’ll keep that in mind for future posts.

          3. In my defense I would not call what I did chastising. I thought rather than taking the path of ” ‘affect’ the Android app. I wonder about this world sometimes…” and make fun of them, it might be better to help them know the difference. I was trying to make the message board a more positive place. Even the end of my post was friendly. My intentions were good and a reaction to the negativity so often found on tech message boards. We tend to be a ruthless bunch with very strong and (mostly) well thought out opinions but extremely unlikely to accept views which differ in conclusions. Sorry if I appeared to be chastising the original poster. I’ll keep that in mind for future posts.

        2. There*

  2. 1 bil is real money

  3. I don’t believe Facebook

  4. hahaha isheep have less and less to call their own.  First Android and now Facebook.    InstaBookGram will be a joke.   I’m sure they’ll riddle it with Zynga games and other junk.  Enjoy a mediocre app.

  5. Facebook claims that Instagram will continue to exist and operate separately” – yes all companies say that during the first 6 months of integration.

    it’s corporate speak until you hear “we’re streamlining operations and realizing synergies” – english translation – “redundant employees GTFO so us investors can make more money”

    1.  Seriously. Quentyn is a fool if he really thinks that. Let’s be real people.

      1. Why does he have to be a fool? Because he is delivering the “facts” and not his opinion on the matter?

      2. I never said I believed they’d stay true to their word. I even provided an example of a good situation gone wrong. But, for now, I can’t assume either way. You can do nothing but just take their word for it now and hope they keep their word.

  6. This sucks.  Lord knows how bad Facebook will fudge this up.  Give it 6 months until it’s embedded into facebook itself.

  7. And not a single F*** was given :)

  8. Can’t say I understand all the hate associated with Instagram. Is it because iPhone users had it first and loved it so much? Or does it come from people who simply hate social sites altogether?

    I think Instagram is a cool way to host pics and share them with friends. The filters are onlya seconday feature to what the service offers. If you don’t like Instagram – don’t use it. Just like Twitter or Facebook. Again, I dont understand the hate.

    And with Facebook buying them.. It would be cool to see an option to autoupload to your Facebook albums. I’m sure this is something we’ll see in the coming months now..

    1. i just don’t understand the point of it. why not just upload the pics directly to facebook/twitter?

      1. The point is that Instagram is a social network in it self. Not just an app to apply filters. People just love social networks.

    2. there are too many social networks, what kills me is all the fuss about high quality pictures from mobile devices only to run them through some shitty filters

      1. high quality pictures from mobile devices…… haha, i bet my D90 is useless now. 

    3. From what I have been seeing all over the web (Engadget, Phandroid, TheVerge, Etc.) it seems that tech geeks in general are angry at every aspect of this story. First they hate Facebook, then they hate Instagram, then they hate Instagram making a ton of money overnight and being purchased a ridiculously successful company. It’s nucking futs.

      I personally see no issues with this deal. Facebook gets access to a very successful team of developers, Instagram does not change its main viewpoints (they will still link up with other social sites), and the 10 people that work at Instagram become incredibly wealthy in a 24 hour time span. I don’t see how anyone could possibly hate on “progression and improvement”. 

    4. Because Iphone is the only platform that needs an app to allow them to easily send pics to “somewhere”. Iphone users thisnk its amazing cause it allows them to do something the OS doesnt. This is built into android; we simply dont need it.  

      As for the photo sharing network;  Who needs another social network to store photos?Good for the Instagram team for exploiting iphone weakness to make some money.  Lets see how long there little photo sharing network lasts once facebook integrates them.

      1. For someone that doesn’t care you seem so pissed off… I don’t understand some users, hey if you don’t like it don’t use it and go on with your life, anyway that’s why you have an Android phone don’t you think. Diversity is good, I think that Android users are more jealous than iphone users, I wonder why…. it doesn’t make sense.

        1. What makes you think I am pissed off?  I was simply explaining why this app is such a hit on iphone and why android users (in general) couldnt care less.  It fills a void in IOS’s capability which makes it valuable for iphone users.  The same gap doesnt exist for android OS, ergo android users (in general) dont see what the big deal is..  

    5. Don’t worry Chris.
      Fanboys are all idiots no matter which side you are on, android or apple.
      Ignorant to everything else out there. It might also be because these people don’t actually have friends to share stuff with…all this hate seriously its just embarrassing as an Android user…

    6. a lot of people are cry babies. I am agreeing with you if you do not like it do not use it period. Keep up the good work !

    7. Chris.. Do you mean no one can share pictures unless you have Instagram camera?

    8.  It’s funny. iphone fans say ew because instagram is on android and android fans say ew because instagram is on android.

  9. instagram is fucking retarded. i don’t get why everyone wants to have an app that can apply mediocre, shitty effects and filters to low res pics

    1. That’s why I never downloaded it

    2. Instagram is retarded but who is getting the $1billion dollar check? you ?

      1.  i never said they weren’t getting a nice check. it’s still a stupid app.

    3.  Because it was only for iphone and made them feel special and wanted.

  10. Tried instagram and it was not something I found useful uninstalled the app. But considering the amount of people using it, Facebook made a smart move eliminating a competitor.
    We had the network consolidation in the 20th century. Now we have the social network consolidation in the 21st century. How long until all media is provided by one huge conglomerate?

  11. who cares, facebook and instagram both suck

    1. Not if you have friends. Its changed the world.

      1. you are right, half of all new marriages that end in divorce are facebook related

        1. are you generation X? 

          1. yes i am

          2. Now it’s all made sense now. Generation before Y are not in to social network sites. According to a research.

      2.  I have friends and none of them are on facebook. Basically it’s for bored people who are addicted to farmville.

    2. well, i got friends. 

  12. Glad I didn’t bother installing it. Not that I have any interest in using it. I’m Facebook free and proud.

  13. Cool. Now if only all the companies whose products I don’t give a $#!+ about could all merge into one, that would make my life easier.

    Next step: Apple: Buy Facebook.

  14. I am not trolling here, just asking an honest question, what is about Facebook that makes everyone so incredibly homicidal. Is it all about the privacy issues? I use it to maintain contact with a small group of friends, and it works just fine for that. It’s easier than setting up a listserv. If you’re concerned about privacy, why are any of you even using the Internet?

  15. Deleted from my phone.

    Facebook is creepy.  I don’t trust them with my information.

  16. i want to use instagram, but if they are bought by facebook, i would need a facebook account to do so. :(  there are a few services i cant use because i dont want a facebook account.

  17. I used to hate two things, now it’s just one.

  18. i installed instagram on both my phone and tablet but didn’t sign up.. LOL
    i already have facebook , i think this is nice, instagram and facebook in one..

    oops just read the article LOL, it will operate separately? it has to be at least integradted or connected with facebook? if not, then i still wont sign up to instagram..

  19. Facebook still doesn’t make much money.  All valuation of it to this point has been speculative.  

  20. I highly doubt any instagram user does not have a Facebook Page. So it doesn’t really matter does it

    1. Hi, you’re wrong.

  21. maybe the instagram team can design a decent fb app. that would be worth a $Billion.

  22. wow really? that’s awesome, where can i meet her? 

    1. deleted

  23. its a shame google+ isn’t picking up more…at least in my area…its fb+instagram and much more

  24. I don’t think you understand the meaning of “cash cow.” Instagram doesn’t appear to have any business model, that is, apart from “get big, then get acquired.” Looks like that worked, but it still leaves facebook holding the bag, which they afford with advertising revenue.

  25. my best friend’s mother brought in $19791 a month ago. she has been making cash on the internet and got a $349700 home. All she did was get blessed and set to work the clues explained on this web page… 

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