In celebration of its 8 year anniversary, WhatsApp (acquired by Facebook in February 2014) announced a ‘reinvented status feature’. And it looks surprisingly familiar: to Snapchat Stories. The new feature allows users to share photos and videos with their contacts on WhatsApp and, just as all other Whatsapp messages, status updates are end-to-end encrypted.
In a blog post announcing the update, WhatsApp’s CEO and Co-Founder Jan Koum described the new feature as an evolution of its text-only status update. “The original idea behind the project was to build an application that lets your friends and other contacts know what you’re up to. This was months before we added messaging.” The new status update that copies Snapchat stories is designed to ‘share photos and videos with your friends and contacts on WhatsApp in an easy and secure way’.
Here’s how Jan commented on the new feature when asked about it at Startup Grind conference in Redwood City on February 22:
While it’s unlikely that WhatsApp timed the feature development and launch with the only objective to undermine Snapchat’s IPO roadshow, it definitely throws a shade on Snapchat that, reportedly, had cold reception in London the other day. The redesigned status update feature targets users in the markets where Snapchat’s presence is not as strong as that of WhatsApp. Snapchat therefore has to have a very strong product and growth strategy in place, that would offset Facebook’s effort to undermine the company’s performance by copying its most popular features.
User growth has been one of the biggest concerns for potential investors during Snapchat’s IPO roadshow investors. Snapchat explained a slowdown in DAU (daily active user) growth (it fell below 50% in Q4 2016, according to the company’s deal prospectus) by issues with development on Android however the the user growth issue makes investors cautious when planning their Snapchat investment strategy. Facebook cloning Snapchat’s most popular features and launching them to its established and engaged audiences doesn’t make life easier for Snapchat.
Snap Inc. IPO is scheduled for March 2.
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