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WhatsApp Messenger is a proprietary, cross-platform instant messaging subscription service for smartphones. In addition to text messaging, users can send each other images, video, and audio media messages as well as their location using integrated mapping features. The client software is available for Google Android, BlackBerry OS, Apple iOS, selected Nokia Series 40, Symbian, selected Nokia Asha platform, Microsoft Windows Phone and BlackBerry 10. WhatsApp Inc. was founded in 2009 by Americans Brian Acton and Jan Koum (also the CEO), both former employees ofYahoo!, and is based in Mountain View, California. The company employs 55 people.
Competing with a number of Asian-based messaging services (like LINE, KakaoTalk, WeChat), WhatsApp handled ten billion messages per day in August 2012, growing from two billion in April 2012, and one billion the previous October. On June 13, 2013, WhatsApp announced that they had reached their new daily record by processing 27 billion messages. According to the Financial Times, WhatsApp "has done to SMS on mobile phones what Skype did to international calling on landlines."
As of November 10, 2013, WhatsApp had over 190 million monthly active users, 400 million photos are shared each day, and the messaging system handles more than 10 billion messages each day. In a December 2013 blog post, WhatsApp claimed that 400 million active users use the service each month.
On February 19, 2014, Facebook Inc. announced it is acquiring WhatsApp Inc. for US$19 billion. Facebook will pay $4 billion in cash, $12 billion in Facebook shares and $3 billion in restricted stock units to be granted to WhatsApp founders and employees that will vest over four years.
History
In January 2009, Jan Koum bought an iPhone and realized that the then seven-month old App Store was about to spawn a whole new industry of apps. He visited his friend Alex Fishman to discuss creating a new app. Koum almost immediately chose the name WhatsApp because it sounded like “what’s up,” and a week later on his birthday, Feb. 24, 2009, he incorporated WhatsApp Inc. in California. Early WhatsApp, installed only by a handful of Koum's friends, kept crashing or getting stuck. The following month Koum admitted to Acton that he should start looking for a job. Acton persuaded him to continue with WhatsApp.
In June 2009, Apple launched push notifications, letting developers ping users when they were not using an app. Koum updated WhatsApp so that each time you changed your status it would ping everyone in the user's network. The app evolved into what we now think of as instant messaging. WhatsApp 2.0 was released with a messaging component and the active users suddenly swelled to 250,000. Koum visited Acton, who was still unemployed while managing the unsuccessful start up, and decided to join the company. In October Acton persuaded five ex-Yahoo friends to invest $250,000 in seed funding, and as a result was granted co-founder status and a stake. He officially joined on November 1.
Koum then hired an old friend who lived in Los Angeles, Chris Peiffer, to make the BlackBerry version of WhatsApp.
Whatsapp was switched from a free to paid service to avoid growing too fast, mainly because the primary cost was sending verification texts to users. In December 2009 WhatsApp for the iPhone was updated to send photos. By early 2011, WhatsApp was in the top 20 of all apps in the U.S. App Store.
The founders agreed to take $8 million from Sequoia Capital on top of their $250,000 seed funding, after months of negotiation with Sequoia partner Jim Goetz.
By Feb. 2013, WhatsApp's user base had swelled to about 200 million active users and its staff to 50. Sequoia invested another $50 million, valuing WhatsApp at $1.5 billion.
On Feb. 19, 2014, Facebook purchased WhatsApp for $19 billion (see Acquisition below).
Technical
WhatsApp uses a customized version of the open standard Extensible Messaging and Presence Protocol (XMPP). Upon installation, it creates a user account using one's phone number as the username (Jabber ID: [phone number]@s.whatsapp.net). WhatsApp software automatically compares all the phone numbers from the device's address book with its central database of WhatsApp users to automatically add contacts to the user's WhatsApp contact list. Previously the Android and S40 versions used an MD5-hashed, reversed-version of the phone's IMEI as password, while the iOS version used the phone's Wi-Fi MAC address instead of IMEI. A 2012 update now generates a random password on the server side.
WhatsApp is supported on most Android, BlackBerry, iPhone, Nokia, and Windows smartphones. All Android phones running the Android 2.1 and above, all BlackBerry devices running OS 4.7 and later, including BlackBerry 10, and all iPhones running iOS 4.3 and later. However, some Dual SIM devices may not be compatible with WhatsApp, though there are some workarounds for this.
Multimedia messages are sent by uploading the image, audio or video to be sent to an HTTP server and then sending a link to the content along with its Base64 encoded thumbnail (if applicable).
Security
In May 2011, a security hole was reported which left WhatsApp user accounts open for session hijacking and packet analysis. WhatsApp communications were not encrypted, and data was sent and received in plaintext, meaning messages could easily be read if packet traces were available. In September 2011, WhatsApp released a new version of the Messenger application for iPhones, closing critical security holes that allowed forged messages to be sent and messages from any WhatsApp user to be read.
On January 6, 2012, an unknown hacker published a website (WhatsAppStatus.net) that made it possible to change the status of an arbitrary WhatsApp user, as long as the phone number was known. To make it work, it only required a restart of the app. According to the hacker, it is only one of the many security problems in WhatsApp. On January 9, WhatsApp reported that it had resolved the problem, although the only measure actually taken was to block the website's IP address. As a reaction, a Windows tool was made available for download providing the same functionality. This problem has since been resolved in the form of an IP address check on currently logged-in sessions.
On January 13, 2012, WhatsApp was removed from the iOS App Store, and the reason was not disclosed. The app was added back to the App Store four days later.
In May 2012, security researchers noticed that new updates of WhatsApp no longer sent messages as plaintext, but the cryptographic method implemented was subsequently described as "broken". As of August 15, 2012, the WhatsApp support staff claim messages are encrypted in the "latest version" of the WhatsApp software for iOS and Android (but not BlackBerry, Windows Phone, and Symbian), without specifying the implemented cryptographic method.
German Tech site The H demonstrated how to use WhatsAPI to hijack any WhatsApp account on September 14, 2012. Shortly after, a legal threat to WhatsAPI's developers was alleged, characterized by The H as "an apparent reaction" to security reports, and WhatsAPI's source code was taken down for some days. The WhatsAPI team has since returned to active development.
Privacy
A major privacy and security problem has been the subject of a joint Canadian-Dutch government investigation. The primary concern was that WhatsApp required users to upload their mobile phone's entire address book to WhatsApp servers so that WhatsApp could discover who, among the users' contacts, is available via WhatsApp. While this is a fast and convenient way to quickly find and connect the user with contacts who are also using WhatsApp, it means that their address book was then mirrored on the WhatsApp servers, including contact information for contacts who are not using WhatsApp. This information was stored in hashed, though not salted form and without "additional" identifying information such as a name, although the stored identifying information is sufficient to identify every contact.
On March 31, 2013, the telecommunications authority in Saudi Arabia, the Communications and Information Technology Commission (CITC), issued a statement regarding possible measures against WhatsApp, among other applications, unless the service providers took serious steps to comply with monitoring and privacy regulations.
One of the drawback of WhatsApp is that the user does not need to send a friend request to send messages to another user. However, users can block numbers on WhatsApp.
Criticism of business model
In response to the Facebook acquisition, Slate columnist Matthew Yglesias questioned whether the company's business model was viable in the long term. It had prospered by exploiting a "loophole" in mobile phone carriers' pricing. "Mobile phone operators aren't really selling consumers some voice service, some data service, and some SMS service," he explained. "They are selling access to the network. The different pricing schemes they come up with are just different ways of trying to maximize the value they extract from consumers."
As part of that, they sold SMS separately. That made it easy for WhatsApp to find a way to replicate SMS using data, and then sell that to mobile customers for $1 a year. "But if WhatsApp gets big enough, then carrier strategy is going to change," he predicted. "You stop selling separate SMS plans and just have a take-it-or-leave-it overall package. And then suddenly WhatsApp isn't doing anything.""
Open WhatsApp Project
The Open WhatsApp Project is an open-source re-implementation of the WhatsApp client software for mobile phones done by an independent group. Initially targeted at the Nokia N9 (which was officially not supported by WhatsApp), it was later ported to other platforms, including BlackBerry 10. It uses the WhatsApp service behind-the-scenes, and is thus not a competitor to WhatsApp, being just a different front-end, and is also subject to the same privacy and security concerns as WhatsApp.
On February 12, 2014 all WhatsApp related repositories hosted on github were removed due to a DMCA notice received from WhatsApp Inc.
Acquisition
On February 19, 2014, Facebook announced it would be acquiring WhatsApp for US$19 billion. It will pay $4 billion in cash, $12 billion in Facebook shares and an additional $3 billion in restricted stock units to be granted to WhatsApp’s founders, Jan Koum, Brian Acton, and employees that will vest over four years subsequent to closing. The transaction is the largest purchase of a company backed by venture capitalists ever.
This work is licensed under a Creative Commons Attribution-ShareAlike 3.0 Unported License.
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