Mark Zuckerberg announced that Facebook had agreed to buy Instagram for a $1 billion. The small teams, who work on mobile world now also, work on facebook. But Facebook rules photos, and Instagram is the new camera. This deal makes perfect sense.
In last year Facebook failed to make a deal with Instagram and it started working on its own photo filters apps. But Facebook was not succeeding in this as Instagram users had only uploaded a mere 150 million photos. In 2012 Instagram comes with a much more favorable term.
Till now Instagram didn’t have much more business so they wasn’t going for building its own ad network. Instagram develop a perfect mobile social network for the SmartPhone and now Facebook has Instagram for SmartPhone.
It is not a worth to spend billion dollars on app that generate $0 but as Facebook is a social networking and the facto place for people to share photos site, it is a drop of water as compared to its potential valuation. The Instagram integration with Timeline has been beautiful.
As per Sam Odio, Facebook's Photos product manager from April 2010 to June 2011 The product makes sense as part of Facebook's portfolio but it is not a worth to spend that much amount on this. After all it is a Facebook mobile application like Facebook Messages apps for mobile. And also they think that Facebook bought this to keep it out of Google's hands.
Facebook point of view it is worth to spend $1 billion as Instagram has more than 30 million users and a fairly consistent experience across both major smartphone platforms. Now who will be ready to loose tens of millions of people and especially for whom product is perfect fit?
