Kara Swisher

Recent Posts by Kara Swisher

FaceTagram? InstaBook? Whatever You Call It, All Your Mobile Photo Are Belong to Facebook (for $1 Billion)!

If you want a quick analysis of why Facebook would pay $1 billion for popular photo-sharing service Instagram, please ignore the obvious financials that just don’t add up at all and have most of the typically unshockable digerati shocked by the sheer amount of the price.

Actually, it’s pretty simple: Photos. Photos. And, oh yes, mobile photos — lots and lots and lots of them.

Astonishingly, Facebook users already upload an average of more than 250 million images daily, making it the most popular photo-sharing service on the Web.

But it’s not the best by far and not the most mobile, which is Facebook’s biggest weakness — that has been accomplished many others, especially Instagram, the favorite of power users who scoffed at Facebook’s weak tools. (The horror of no filters!)

Now — instead of all those billions of juicy digital photos snapped by an ever-growing legion of smartphone users loading up to the beautifully designed Instagram mobile app and living on the servers of the small San Francisco-based start-up — Facebook has now captured all these memories for its massive social networking site.

And while $1 billion seems an awful lot to pay for that privilege — Twitter is quaking with “OMG!” and “Wow!” and “WTF!” tweets about the acquisition — this is apparently priceless for Facebook in a deal that went down quickly and quietly in recent weeks.

That and the fact that the huge sum prevented Instagram from being scooped up by Google.

It’s a clear signal from CEO and co-founder Mark Zuckerberg — who rules all product efforts at the company — of his intent to dominate all innovations that have to do with owning the social experience.

Because while many Instagram photos quickly made their way onto Facebook — sharing on the service, as well as on Twitter, was a big part of the app’s offering — the future of the Menlo Park, Calif.-based company is tied to having control over key elements of the user experience.

Of all of those — communications, status updates, content linking — it has been photos that have become perhaps the most important part of Facebook, almost since its beginnings.

Photos are what allowed Facebook to grow so quickly and what made it more than just a blue sea of text and links to consumers. Its new Timeline depends on big, pretty photos, and Facebook even recently announced that it would allow full-screen viewing of high-resolution photos on its Web site, a pricey endeavor.

So, perhaps it was inevitable that Zuckerberg would pay up for Instagram, too — he knows a good entrepreneurial success when he sees one and apparently has the power to convince start-ups that he can make their bigger dreams come true.

Whether or not Instagram ever makes money is perhaps beside the point at this moment in time, as Facebook is poised to go public at 100 times the amount it forked over for Instagram.

But that it considers such a purchase worth as much as one percent of its expected valuation says a thousands words. And most of those words are “mobile” and “photo.”

As Ben Jacobs noted on Twitter: “Kodak goes bankrupt and Instagram is worth a billion dollars. 2012, y’all.”

Indeed. And, I have no doubt if Zuckerberg could figure out a way to shove all those Kodak moments from analog snapshots onto Facebook easily, he’d have paid up for that, too.


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I’m a giant vat of creative juices.

— David Pogue on why he’s joining Yahoo