
Jan Koum to leave after broad clashes with Facebook - coloneltcb
https://www.washingtonpost.com/business/economy/whatsapp-founder-plans-to-leave-after-broad-clashes-with-parent-facebook/2018/04/30/49448dd2-4ca9-11e8-84a0-458a1aa9ac0a_story.html
======
amasad
He's actually already left as per his Facebook post:
[https://www.facebook.com/jan.koum/posts/10156227307390011](https://www.facebook.com/jan.koum/posts/10156227307390011)

~~~
Flenser
The first comment I see is:

> _Mark Zuckerberg_

> _Jan: I will miss working so closely with you. I 'm grateful for everything
> you've done to help connect the world, and for everything you've taught me,
> including about encryption and its ability to take power from centralized
> systems and put it back in people's hands. Those values will always be at
> the heart of WhatsApp._

Given what's discussed below about the business wanting to introduce features
for Enterprise that would weaken encryption it's interesting to see this.
Although Zuck only talks about encryption, not e2e encryption. It also strikes
me as if he's talking as much to people viewing it as to Jan, and Jan didn't
reply, whereas he has with other comments.

~~~
some_account
It's because it's corporate billshit coming from master sociopath Mark
Zuckerberg.

------
submeta
> Koum and Acton were openly disparaging of the targeted advertising model. In
> a WhatsApp blog post in 2012, they wrote that “no one wakes up excited to
> see more advertising; no one goes to sleep thinking about the ads they’ll
> see tomorrow.” They described online advertising as “a disruption to
> aesthetics, an insult to your intelligence, and the interruption of your
> train of thought.”

So very true.

~~~
submeta
I know many who would have paid 10 dollars a month. Some more, some less.

~~~
EastSmith
The network effects would have not worked, because there are many people that
can not afford $10 a year. These people would have used an alternative and at
the end everyone would have used that alternative (because network effects).

~~~
pietroglyph
Why not just make it $10/mo or ads?

~~~
nsp
Because the people who are most valuable to show ads to are also the most
likely to be be willing to pay $10/mo to not see ads.

~~~
lucb1e
But it doesn't matter if you lose money on those people. The $10/month
_easily_ carries all costs even if 0.1% of users pay and the rest gains them
zero. (At least, back when I did the math in ~2015, when they were probably a
bit smaller than they are now.)

~~~
badestrand
Facebook alone makes $23 per user (from US/Canada) per month so it probably
should rather be $50 than $10 per month.

~~~
ucha
It's per quarter I think.

------
saagarjha
It might be pertinent to see Koum leaving as a sort of canary. Koum promised
to keep WhatsApp secure, and it's clear that with his departure he feels that
he can no longer do this anymore.

~~~
patrickaljord
Mark Zuckerberg answers to Koum leaving:

"Jan: I will miss working so closely with you. I'm grateful for everything
you've done to help connect the world, and for everything you've taught me,
including about encryption and its ability to take power from centralized
systems and put it back in people's hands. Those values will always be at the
heart of WhatsApp."

[https://www.facebook.com/jan.koum/posts/10156227307390011?co...](https://www.facebook.com/jan.koum/posts/10156227307390011?comment_id=10156227327385011&comment_tracking=%7B%22tn%22%3A%22R1%22%7D)

~~~
gingernaut
A PR crafted response that doesn't indicate anything. Facebook is one of the
largest centralized services on the internet, and has no desire to lessen
that.

------
a_d
If true, and still a big if, since the journalist seems to be conjecturing --
this might have implications for Facebook's future acquisitions.

Acquiring social networks that get to scale is an integral part of Zuck's
strategy. It is a fairly smart strategy since one company cannot successfully
lead or copy all the innovation - and social networks are very "taste-
dependent" products. Zuck understands that Facebook is a big incumbent, and as
with any incumbent there would be 'anti-incumbent' products. He was just
willing to buy these products without too much fuss.

His willingness to overpay for these companies has been a part of a long-term
dominance strategy. Maybe he has one or two misses like Snap; but by and
large, his sense for "pricing" these companies and a no-nonsense "Corp Dev"
approach could be thought of as a competitive advantage (plus he has proven
that he can do it repeatably). The lawyers don't get involved until much later
- he "leads" from the front when doing these deals. It is not very common in
large-company-land.

If Jan Koum, who is very highly respected (he is truly a no-bullshit
product/management person) leaves for the "wrong" reasons, it might have long-
term implications for other companies that Zuck wants to buy in the future.
Thus leaving an opening in the market for an 'anti-incumbent' offering to
thrive.

~~~
RestlessMind
I don't think a normal founder would refuse $19B acquisition offer - it is a
very big number. I don't know anything about Jan Koum, but he has already
pocketed his billions. So whatever signal he gives by leaving is pretty
clouded.

~~~
joering2
The old saying goes: "if you can put a price on your morals, then most likely
you didn't have any morals in the first place"

~~~
randomsearch
I understand your sentiment, but it isn’t just him he’s making the decision
for - he would have turned down the money for his employees too. IMO that’s
much harder to do than turning down more riches for yourself.

------
andr
This is huge. While WhatsApp is not as big in the US, it is the de facto
messaging platform in most of Europe and even Latin America. It uses the
Signal encryption protocol. If this fact changes, people deserve to know.

It feels like there have been surprisingly few internal leaks from Facebook
employees, compared to the rest of FAANG. Now would be a good time for someone
to blow the whistle.

~~~
saagarjha
Not to mention much of Southeast Asia as well.

~~~
dominotw
And in south america. Basically in all 'emerging markets'.

~~~
tim333
Whatsapp made a smart decision to make a java app that worked on non
smartphones. Hence it being app of choice in places where many people didn't
have smartphones.

------
paxy
Worth noting that the other founder, Brian Acton, already left Facebook last
September (and in fact tweeted #DeleteFacebook recently), so it is pretty
obvious that the relationship between the two groups has been less than
perfect.

I'm pretty certain that they didn't want to sell WhatsApp in the first place,
and knew the privacy risks that having Facebook as an owner would bring...but
of course $19 billion is enough to settle a lot of issues.

I personally consider WhatsApp to have the same level of security/privacy as
Messenger. If you need E2E encrypted messaging use Signal instead.

~~~
walterbell
With that money, a new messenger can be created, preferably one that uses an
open E2E-encrypted protocol that supports decentralization.

~~~
mywacaday
How does Signal plan to be long term financially viable? If they can't find a
model that works why won't they go the way of whatsapp or the dodo?

~~~
azernik
It's a non-profit, running off of donations.
[https://freedom.press/crowdfunding/signal/](https://freedom.press/crowdfunding/signal/)

~~~
confounded
Yep.

It’s already a model, and it already works. There are no VCs, there is no
exit.

------
esbafb8
This is no joke. It reminds me of when Skype used to be secure then somehow a
backdoor was introduced following (or before?) the acquisition by Microsoft.
History repeats itself, and humans have yet to learn from the past.

~~~
tptacek
In this case, strong E2E encryption was introduced _after_ the acquisition
(though presumably it had been in the works previously).

~~~
zero_intp
Pardon my skepticism, but Microsoft has most definitely advertised to the TLAs
that Skype communications are available for review.

------
muglug
> Eighteen months later, the promise not to share data evaporated. Facebook
> pushed WhatsApp to change its terms of service to give the social network
> access to the phone numbers of WhatsApp users, along with analytics such as
> what devices and operating systems people were using.

Hmm... doesn't sound like the Facebook we all know and love.

------
Steeeve
It's been what? 3 1/2 years? He was probably under contract to stay for 3
years and he now has a big pile of money and the power to do what he wants.

So he gloriously exits on principal and plays hero for a day while thumbing
his nose at the company that made him rich for the decisions that made him
rich.

~~~
confounded
Well... that’s what I’d do. What would you?

~~~
Steeeve
I'd take a long hard look at myself, my current opportunity, and what I want
to do. It would be hard to walk away from the opportunity to occasionally
influence someone like Zuck, or the opportunity to occasionally influence the
global end user base of Facebook.

I'm not saying what he did is a bad thing. It's th human thing. More saying
that his position isn't all that newsworthy. It's pretty easy to take a pot
shot on your way out the door. If changing minds was his real goal, staying
and making change happen from the inside is much more realistic.

~~~
tgragnato
I get what you think. Although it’s near impossible to change things when you
meet the combination of people who do not listen and money.

------
adventured
Koum has also liquidated the bulk of his Facebook position at this point. He's
sitting on $8.4 billion in cash and $2 billion in remaining Facebook stock (he
previously gave 12.6 million shares of Facebook to the Silicon Valley
Community Foundation; worth $2.1 billion at today's price).

Looking forward to what he does next. He certainly has the resources to do
almost anything that catches his attention.

------
neerkumar
Sad news. WhatApp really feels to me as the future of social networks and its
massive numbers tend to prove it.

1:1 chat and phone calls to communicate to your friends, groups to keep in
touch with people you are less close to, and status in the extremely rare case
that you want to briefly show something to all of your contacts (but without
all the problems of FB: your contacts are all people you actually know fairly
well, no like and similar bullshits that create so many problems, no pictures
stored forever, etc.).

At the same time, I already saw many people switching to telegram. It seems
impossible for whatsapp to decline given its current numbers, but who knows
really.

~~~
s73v3r_
Isn't that AOL Instant Messenger, then, just on phones?

------
crunchlibrarian
These sorts of disagreements and exits happen all the time, but they are
usually kept quiet and excuses are made. It's unusual to see this done quite
publicly, apparently hand in hand with a journalist. I'm guessing he wanted to
spark some debate.

~~~
saagarjha
Of course, that's why the article was written. Here's the first line in it:

> The billionaire chief executive of WhatsApp, Jan Koum, is planning to leave
> the company after clashing with its parent, Facebook, over the popular
> messaging service’s strategy and Facebook’s attempts to use its personal
> data and weaken its encryption, according to people familiar with internal
> discussions.

So obviously it's meant to spark some sort of discussion on Facebook's
attempts to remove security features so that it can monetize the app better.

------
rajacombinator
Taking a huge buyout then trashing your acquirer for PR points a few years
later seems in poor taste. They knew exactly what they were getting into when
they accepted the FB megabucks.

~~~
soziawa
Zuck fucked them and the regulators over when he promised to keep WhatsApp
independent. The sale would have never gone through if he hadn't promised
that.

~~~
zero_intp
This is the truth, FB is being fined by EU regulators for dissembling.

------
igravious
In the interests of competition and data protection Facebook should never have
been allowed to swallow Instagram and WhatsApp and Microsoft should have been
prevented from acquiring Skype and LinkedIn.

Network effects are too strong online to allow mergers of this sort and the
potential for abuse too great from both state and non-state actors, not to
mention invasion of privacy issues.

The bar for mergers and acquisitions ought to be way higher in this domain. If
regulation does not fix this I believe these tech companies ought to be
divested of these products.

Ultimately paid federated services and free & open source software are the
only true countermeasures to these very real threats. I would nearly go so far
as to say that we should all chip in to make this become reality.

------
ggg9990
Actually, I’m surprised a guy with $8 billion in his pocket worked a day job
at Facebook this long.

~~~
stevenwoo
Others have speculated he was waiting to be fully vested in stock options. The
other possibility that I don't know if true or not was perhaps he had a
contract that he did not want to break - I have worked at a startup that got
bought and they fired the founders as soon as their contracts were up.

------
banachtarski
I understand this goes against the current ethos but honestly, you can't
provide an essentially free service and expect things to just keep running
sustainably. Nobody has proven that a social network can be run successfully
without advertising and analyzing user data. I wonder what Mr. Koum offered as
a counter-proposal for keeping the lights on at what should be an exorbitant
cost with their userbase. My guess is, not enough, if anything.

Note: I do not work for facebook, nor am I huge on any social media, although
I am a "light" user of both facebook and twitter.

~~~
icebraining
Whatsapp is not really a social network, it's a (not very complex) IM. The
costs are probably quite different (number of features, long-term storage of
media, concurrent access to the same messages, etc). Supposedly they were
running with only 50 engineers supporting 900M users when they were acquired.
I don't know their hardware costs, but overall it doesn't seem like an
expensive operation.

~~~
banachtarski
It still needs to have a business purpose. 50 engineers + salaries/insurance +
server costs for billions of users. Yea, not cheap.

~~~
icebraining
They only raised $60M total until getting acquired, so it can't be _that_
expensive.

~~~
banachtarski
I'm not sure how you explain to future investors that you want to raise 60 M
with no plan on returning that investment. Companies != charities.

------
JumpCrisscross
> _Facebook’s attempts to use its personal data and weaken its encryption_

What’s this about weakening WhatsApp’s encryption?

~~~
mundo
Yeah, the article is super-vague about that:

> In 2016, WhatsApp added end-to-end encryption, a security feature that
> scrambles people’s messages so that outsiders, including WhatsApp’s owners,
> can’t read them. Facebook executives wanted to make it easier for businesses
> to use its tools, and WhatsApp executives believed that doing so would
> require some weakening of its encryption.

Not sure what this means. "Weaken" is kind of a confusing term, FB either has
access to the message content to feed in to adsense's gaping maw or they
don't.

~~~
Pyxl101
I don't understand why allowing businesses to use WhatsApp would require
weakening its encryption. Can anyone parse the meaning of this, or speculate
about why that would be necessary? It makes no sense to me.

Are they perhaps implying some kind of central analysis of sent messages for
targeting purposes?

~~~
zaphar
If I were to speculate, and it would definitely be speculation, I would say it
was adding some sort of key escrow for encrypted chats in the Enterprise. It's
not uncommon for escrow to be a requirement in Enterprise encryption products.

~~~
zero_intp
This is my experience as well.

------
kentosi
I'm saddened by this new, but more so for Android.

WhatsApp was my main counterpoint for anyone using iMessage as a trump card
for getting an iPhone with its end-to-end encryption and the status indicator
that the other user is typing something.

~~~
cft
Use Telegram. Russia blocked it since they refused to hand over private keys
to the government. Interestingly they never blocked WhatsApp.

~~~
habitue
The way Whatsapp encryption works, they don't have the keys to hand over.
Telegram is unique in its state-vulnerable encryption implementation

~~~
sfifs
This is incorrect. WhatsApp encryption keys are managed on server and hence
can be MITMed on state warrants quite easily by WhatsApp unless you are very
careful to follow key changes and verify keys physically - and even then how
would you know since it's WhatsApp app that is showing the key, and not
something you generated independently out of band with a different program.

What the encryption does is prevent non state level actors from breaking into
your conversations.

------
shamino
Do I think it's noble that Koum is leaving because of his convictions? Yes. Do
I think this is a good sign for Facebook's stock? Yes.

~~~
saagarjha
> Do I think this is a good sign for Facebook's stock? Yes.

Why? Is having a person on the board that provides a moral check on the others
a hazard to Facebook's stock price?

~~~
shamino
It can be. Now they can start advertising on WhatsApp and begin to release
that revenue giant.

~~~
saagarjha
With recent regulation, it might be better in some scenarios to _not_ push
advertising on some platforms, or at least have some sort of pushback before
it's implemented so that it's done in a way that doesn't open them up to
fines.

------
arikrak
Facebook spent close to $22B on WhatsApp in total so they can't just keep it
forever as a zero-revenue messaging service. Either they'll put ads in it or
they'll try to tack on other services, like WeChat does.

~~~
GFischer
There are millions of companies waiting for WhatsApp to have a B2C API to spam
users.

Every company I've worked for wanted this.

------
talltimtom
Lots of people have bee saying that WhatsApp was a better alternative to
messenger because of better privacy. Looks like Facebook is listening and want
to “solve” that issue.

------
pritambarhate
It's strange that WhatsApp hasn't launched micropayments, e-commerce and
wallets yet. In India PayTM ([https://paytm.com/](https://paytm.com/)) has
kind of won this space. Google has launched Tez
([https://tez.google.com/](https://tez.google.com/)). PayTM and Tez have given
lots of cashback deals to people to install and keep the apps on their phones.
WhatsApp is already there on everybody's phone.

I have heard WeChat is doing something similar in China for a number of years
already. I think WhatsApp is loosing a very good revenue opportunity by not
moving quickly in this space. It gives them alternative business model too.
Two main properties (FB and Instagram) depend on ads, WhatsApp can bring the
revenue from wallets and e-commerce. I think it's better to have a diversified
revenue model.

~~~
sah2ed
I remember reading somewhere that they were trialing payments in a bid to
monetize small businesses that have come to depend on their platform to reach
customers. I believe this was in India or so.

Anyway, they clearly are taking payments and India seriously as they still
have some open positions:

[0] Product Manager, Monetization
[https://www.whatsapp.com/join/?dept=product-
management&id=a0...](https://www.whatsapp.com/join/?dept=product-
management&id=a0I1H00000LC0BxUAL)

[1] Head of India, WhatsApp
[https://www.whatsapp.com/join/?dept=whatsapp&id=a0I1H00000LJ...](https://www.whatsapp.com/join/?dept=whatsapp&id=a0I1H00000LJmwzUAD)

------
vthallam
I mean what did they expect when they were selling it to Facebook? It's far
too compelling for facebook to not to milk Whatsapp users/data in some way.

There could have been some balance of power if the 2-3 most used forms of
communication across the world are not under a single company which loves advt
revenues.

------
timvisee
The article mentions that privacy has always been a big priority as Koum says.
I can't take that seriously though, as things like encryption were horribly
bad in the beginning. In fact, there was no encryption at all. I can't call
that "privacy focused".

~~~
reitanqild
Well. As much as I don't like what WhatsApp has become under Facebook I think
you are unfair to them in the same way that I think people are unfair to
Telegram today.

Early Whatsapp still respected privacy. They didn't datamine us or spam us.
And they where working long term to make it better. I've no doubt encryption
has been worked on well before they were bought.

Same with Telegram now: they seem to be working hard to provide a good
messenger.

Their crypto is not as good as Signals (AFAIK) but unlike new WhatsApp they
don't plan to datamine me for profit. And I think they are working hard behind
the scenes to make encryption even better and possibly decentralize the serber
infrastructure.

------
stjohnswarts
I predict they want to ad advertising but won't break the encryption for
snooping purposes. If they hook it to the FB account they can just use the ad
preferences that their AI picks out from FB interactions. Even if not everyone
has FB account, a majority probably do.

------
cft
4 year vesting anniversary seems to have been in Feb 2018

------
unlimit
I find it very naive that Mr Koum had hoped it would be otherwise. I was just
a matter of time.

------
cft
4 year FB stock vesting anniversary was in Feb 2018

~~~
Moodles
Aren't vesting schedules typically quarterly incremental rather than
everything after four years though? If that's the only evidence of him
delaying his morality for financial reasons, I think that's pretty harsh.

~~~
simonebrunozzi
He probably got a very custom deal.

------
onetimemanytime
_> >“no one wakes up excited to see more advertising; no one goes to sleep
thinking about the ads they’ll see tomorrow.”_

Fair, but where did that $19 BILLION came from? $19B for a company making $20m
a year

~~~
beagle3
The company making $20m/year was seen as a threat by a bigger company making,
at the time, $2000m/year. So the bigger company, worth something like $100B at
the time, decided it was worth forking $19B to eliminate that threat.

It's that simple.

~~~
onetimemanytime
_> >So the bigger company, worth something like $100B at the time, decided it
was worth forking $19B to eliminate that threat._

Missed the point. They hated ads but they got the money ads made possible. FB
with no ads can't even pay for hosting

------
yazaddaruvala
FWIW, as a protest, I always report Facebook ads in Messenger.

You should do it too :)

~~~
perl4ever
The only Facebook ads that really upset me is when it says my FB friend
"liked" something. Facebook should not use a "like" as an endorsement like
that. Apart from the fact that it could be an accidental click, liking a
particular post or event or thing is completely different from endorsing the
company in general for all time.

------
dep_b
> Facebook’s attempts to use its personal data and weaken its encryption

Finally they found a way to start me looking into alternatives. Spoken
messages was already a regression for me, then they added a terrible VoIP
service people accidentally kept using but those were just minor niggles. This
is the point where I might start thinking into bailing out.

------
anuraj
WhatsApp is much more monetizable than Facebook. It is a giant transaction
switch that can become the biggest payment and commerce network on the planet.
Zuckerberg would do well to unwind and eventually shutdown Facebook which will
anyway die a natural death and concentrate on WhatsApp.

------
itslennysfault
Is there any valid reason to use WhatsApp over Signal?

I've been gradually trying to move my WhatsApp friends over to Signal so I can
stop using a Facebook owned product. This news just reinforces my belief that
I shouldn't trust any product owned by Facebook.

~~~
confounded
Only the user-base, and slicker UA/UX.

If the people you want to chat to are happy moving, you’re all good. I’m in
this position and haven’t had any problems.

~~~
randomsearch
I’d say Signal has almost caught up with WhatsApp UX and is developing much
faster, so it will overtake at some point (I’d say within a year).

~~~
GFischer
To make switching more enticing, it should have a killer feature that users
care about.

Feature parity isn't enough.

~~~
confounded
Enough for what?

------
mankash666
We ought to be practical here - Facebook is a for profit enterprise and
WhatsApp was their most expensive purchased. They're obviously under investor
pressure to make that a good buy.

------
tonylemesmer
Presumably he's entered some kind of non-compete clause in his contract with
FB.

Great opportunity for someone to start a competitor no?

------
shubidubi
Facebook is in a really low point. All the recent privacy events and the fact
that a 19B accusation fonder does not want to stay with them are red flags. My
feed has become empty at the past months, fewer people are liking/commenting
on my posts and I check my account much less than I used to be.

I wonder how they gonna get out of this downward spiral before they become
another Google+.

~~~
batiudrami
Is the bad press actually costing them revenue though? News feed impressions
are down sure, but revenue is up, and so are monthly active users.

Google+ was never anything like Facebook. We don't have a fallen social
network to compare Facebook to, because we have never had a social network as
big or as intertwined in our lives as Facebook.

~~~
isostatic
MySpace would be a closer analogy but still a couple of orders of magnitude
off

Geocities arguably suffered the same fate

------
btbuildem
Ugh. Another one bites the dust, I guess.

------
dapreja
I really hope signal vets a UI redesign (at least for android)

~~~
cryodesign
What wrong with the UI in your view?

------
justonepost
News at a 11, Startup founder leaves a year or two after being acquired by
much larger company. Say it ain't so.

