
Why we don't sell ads (2012) - samx18
http://blog.whatsapp.com/245/Why-we-dont-sell-ads
======
netcan
_when advertising is involved you the user are the product_

How about: If you're work at a startup where the business model is 'get
acquired,' _you_ are the product.

Incidentally, I don't really agree with either of these statements, at least
not in their strong forms. The problem with advertising is usually bad
advertising. Ads (especially online ads) are usually annoying in inverse
proportion to their value. Spam is on the low value & annoying end of the
spectrum. 90% of annoyance probably comes from 10% of the value. Regarding
privacy, advertising is just the most visible part of something wider and the
hidden part of this iceberg is the most worrying.

Anyway, that's besides the point. This "old" blog hints at something sort of
hypocritical or schizophrenic about startup culture. On one hand its hackery
and lone wolfish and disruptively anti establishment. We can beat you from our
basement in our sandals. Hang your cubicles. We don't need bosses or talks
from HR departments. We don't need to communicate in corporate speak. There's
a hard to deny anti corporate drone streak.

On the other hand, the investment and incentive to found startups is based
around the ability to get big fast. Huge. Very fast. Multi billion dollar
acquisitions and IPOs in 5-10 years.

Huge means "corporate." Either the startup becomes a huge corporation or their
product is put in the hand a big corporation. The real people feel o company
where cute memes sound like 'don't be evil' start to sound like _" for your
convenience…"_

I don't have any normative message.

~~~
LaGrange
You're missing one more part of the issue with advertising: brainwashing. In
some ways, I'd rather have a silly, mismatched and ugly ad than an ad that's
actually effective at altering my behavior. Pretty much the only situation
when I want to see an ad is when I'm looking for a specific product, and there
always used to be venues that were very effective at that (specialist press,
classifieds, or popular streets where restaurants have their windows). Pretty
much anywhere else ads are unwelcome, even if they manage to be "nice", and
effectively constitute selling chunks of my brain to get access to Facebook.

And, for the other point, the "tiny, innovative, disruptive startup" is
something I've never bought. At best, it's outsourcing the R&D risk, with very
few exceptions. So much innovation happens either in academia, or in terrible,
huge corporations like Boeing or Stadler.

~~~
gordaco
I'd like to add something to this: we like to believe that we are immune to
advertising, but we aren't. No matter how much self control and self awareness
we may think we have.

The consequences may not be as grave as they look at first sight, but it's
still a very uncomfortable truth. Recognizing my own vulnerability to ads is
one of the many reasons why I block advertising.

------
rayiner
Remember the internet back when ads were just something you ran across on
cheesy low-quality (or porn) sites?

[http://royal.pingdom.com/2008/09/16/the-web-
in-1996-1997/](http://royal.pingdom.com/2008/09/16/the-web-in-1996-1997/)

[http://allthingsd.com/20090720/yahoo-home-pages-over-the-
las...](http://allthingsd.com/20090720/yahoo-home-pages-over-the-
last-15-years-the-good-the-bad-and-the-ugly-really-ugly/)

[http://www.makeuseof.com/tag/time-10-big-websites-
looked-15-...](http://www.makeuseof.com/tag/time-10-big-websites-
looked-15-years/)

~~~
mkr-hn
That's because low quality sites were the only ones that would run the kind of
ads we had back then. Then someone built an ad blocker and forced the industry
to rethink its approach.

~~~
duskwuff
I think you've got your chronology off. Ad blocking was a _response_ to
widespread advertising on web sites, not vice versa!

Ad blocking software has only become common in the last five years or so, as
web browsers with "extension" support have become widespread. It was very rare
before that.

~~~
auxbuss
This really isn't so. Ad blocking goes back much further. Here's Ad Muncher
v4.7 from 2006: [http://ad-muncher.en.softonic.com/](http://ad-
muncher.en.softonic.com/) We were blocking ads back in the 1900s.

~~~
duskwuff
Internet display advertising dates back to the early 1990s (the first
clickable banner ad was in 1993). I can't find any exact information on when
ad blockers became widely available, but I suspect it wasn't until at least
2000 or so. I certainly don't remember them being a thing before then.

Most of the early banner ads that have been documented were run by generally
reputable advertisers (and on reputable sites), not on the "low quality sites"
you're implying. There weren't even very many such sites back in 1993; the Web
was a _very small_ place back then.

------
antisocial
Advertising has us chasing cars and clothes, working jobs we hate so we can
buy shit we don’t need. – Tyler Durden, Fight Club

That's an awesome quote. Personalized ads (retargeting etc are even worse). I
didn't realize this before I worked for an ad network. Once I understood how
retargeting works (and also after implementing a humble feature), I realized
how unethical it is to constantly tempt the user to buy something he or she
can not afford or even if she can afford it, the money she could have put to
better use by saving. I resigned from that company after a short stint even
though it had a great work culture, great team etc. But had they offered me
some crazy stock options, may be I wouldn't have had the moral courage to
quit, with an underwater mortgage and financial insecurity.

------
general_failure
Most people's morals and ethics, however "religious" and staunch they sound,
is up for sale. It's just a matter of finding the right price (as long as what
you want from them is not illegal).

I am yet to meet someone whose morals are not for sale. I only know figures
like Gandhi but I never got a chance to meet them (and some books told me they
were flexible when it came to themselves - re: his wife's medical treatment).

~~~
tbarbugli
I can find lot of names but I am lazy and one is enough to prove you wrong
[http://en.wikipedia.org/wiki/Thomas_More](http://en.wikipedia.org/wiki/Thomas_More)

~~~
matthewmacleod
Your parent literally said "most people," i.e. one example is not enough.

And I have to agree. There's a reason the idiom "every man has his price"
exists. Certainly, if a large company offered me billions of dollars for a
small business of my own, there are relatively few scenarios I can imagine
where I'd turn it down.

------
debt
The more I think about the acquisition the more I wished WhatsApp would've
stayed on their own. $500 million a year is great. I wish they would've pulled
a Craigslist and become more of a cultural institution than another
acquisition; focus more on making chat amazing.

I feel like that would've had a larger, net positive effect on the public
consciousness. People would see WhatsApp doing it for what's right(don't be
evil) then what's profitable and I think that's just a good sentiment to have
out there in the aether.

They could've easily, easily taken on the Google/Facebook conglomerate.

~~~
amirmc
> _" I wish they would've pulled a Craigslist..."_

EBay owns around 25% of Craigslist.

~~~
debt
Then I wish they would've pulled a VSCOcam or something similar. Albeit
they're not a cultural institution yet, they seem to be headed in that
direction.

------
ryguytilidie
Man, I would put whatever the fuck people wanted on my site if it meant my
family and the generations after could live comfortably. That's why I try not
to make statements like that.

~~~
gingerlime
Even if statements like that _help_ getting your family and generations after
to live comfortably?

------
pearjuice
If you are a vegetarian and you are told to go to a butcher to buy meat, you
shouldn't do it out of principle.

When you are WhatsApp and you are against advertising - referencing a quote
with great aversion towards it - you shouldn't accept billions from a company
who is build on the single premise of advertising.

They have lost all my trust.

~~~
pskittle
"you shouldn't accept billions from a company who is build on the single
premise of advertising."

Facebook wasn't built as a way to earn revenue from ads , it was a way for
them to monetize on something they built , albeit -- not appealing to the
endusers , however it keeps you connected to people in your social circle .
Imagine life without the googles and face books of our time

------
malanj
The whole WhatsApp acquisition touches on some of the same personal nerves
that Google's acquisition of EtherPad did. It was a really great product that
I used daily. At the time Google had big plans for their Wave product, and the
entire deal seemed to make sense. Fast forward a few months and Wave is a dud
and EtherPad is no more.

I'm not saying that WhatsApp won't be useful to Facebook, but I do think that
the philosophy and goal of the two companies are very different. Ads is one
potential "technology" that could monetise the product and it's obviously
against the founders' philosophy. There will however probably be many other
(more subtle) influences from Facebook's side that'll slowly shift it away
from the original vision - and promises to users. That's life I guess: take
the cash or keep you vision.

~~~
LukeB_UK
Etherpad is now an open source product. In fact, it is still being developed,
and is currently being rewritten in JavaScript to run on Node.

Wave as a product no longer exists, however a lot of the technology that
Google used has been merged into other products such as Google docs.

~~~
dirkc
The project lost a lot of momentum after Google acquired the developers
working on Etherpad. I think the original codebase got forked as the Etherpad
Lite project that is still being developed.

------
stoev
While I strongly support any business model that tries to escape from the
typical ads monetisation strategy, we can see (two years after this post was
published) that not relying on ads has not been the best long-term strategy
for WhatsApp for two reasons: 1\. They didn't manage to stay independent and
had to sell to Facebook. I always thought that they had a very good chance to
expand their product and built a platform that could truly challenge Facebook,
Twitter, etc. 2\. Now that they have been acquired by Facebook, we know that
it is only a matter of time before an ad product is introduced into the
service.

~~~
subdane
They didn't have to sell to FB they chose to. They had a history of flipping
to paid versions of the app to cover costs and reduce growth. Their actual
competitors were carriers who charge exorbitant SMS fees internationally. At
~500M users their plan to simply charge $1/yr would have covered their costs.

~~~
stoev
I don't see it that way. After selling to FB it became clear that hey intended
to launch VoIP. If they actually wanted to launch a high-quality product,
better voice service than the one offered by carriers (and therefore much
better than what Viber has to offer), they would probably have struggled to do
it without the help of FB. Every carrier on earth would be against them.

~~~
stoev
A carrier would give a lot more thought to disrupting a competitive voice
service provided by FB (who already have many agreements with carriers
worldwide regarding data usage) than an independent and not particularly well
funded (by carrier standards) company like WhatsApp.

------
netrus
Please add a [2012] to the title. Some stuff has happened since then :)

~~~
Jake232
Most significantly: "Your data isn't even in the picture. We are simply not
interested in any of it." \- Pretty sure Facebook are interested in it.

------
_broody
I can't imagine Facebook getting even 10% of their investment on Whatsapp
back. It's crazy that they blew so much money on something which hasn't proven
to be anything more than a flavor-of-the-day platform. Whatsapp suffers from
the same flaw that made Facebook start losing customers to it in the first
place: there was a paradigm shift in what the customers wanted in their social
apps, and FB always was a touch too complicated for mostly-mobile users'
needs. And just like that, the strongest player in the social industry started
to decline.

There is zero guarantee that there won't be another such paradigm shift in the
near (even super-near) future that would displace Whatsapp overnight. And
unlike Facebook, which has tons of features (too many, yes, but that makes it
unlikely that someone can replace Facebook with any single solution, which
drastically slows down people jumping platforms), they're a one-trick pony
banking everything on being SMS, only better. The second something happens and
this stops being such a big deal to their users, Whatsapp loses everything.
They have no means to ensure long-term user loyalty, they have no other value
proposition, they're not ahead of the curve in any other relevant way. If (or
rather, when) the Whatsapp bubble pops, FB is left with nothing.

------
dpierce9
This is simply the cable tv model applied to internet services. Cable went
from pay to avoid ads to pay and still get ads (and of course there is Hulu).
These guys just figured out how to double dip in a really subtle way.

------
amirmc
_" When people ask us why we charge for WhatsApp, we say "Have you considered
the alternative?""_

It must be frustrating for those users who really _did_ consider this and
thought $1 per year was a bargain. Over time those users may have convinced
their friends to sign up and Whatsapp made that choice easy by being available
on a lot of platforms.

Everyone has a price. The only way to really avoid this kind of situation is
to push things to be decentralised/distributed or fully encrypted. That's even
harder to do (but I'm working on it with a bunch of others - see my profile).

------
gesman
"In the land of the evil the saints emerge..." (and take venture capital to
maintain their sainthood along the way).

What works for Whatsapp didn't work for many others and vice versa.

Ads are necessary evil, sort of like taxes. There is a price for Whatsapp's
sainthood their very users are paying for with other currencies. One way or
another it is an exchange.

Saint my ass.

------
robertoparada
My assumption is that FB bought Whatsapp for its attach business AKA for its
data minning opportunity. I bet they won't throw ads in there, but rest assure
that if you're talking vacations with your group "Family", you'll see a
suggestion around that via Facebook site/mobile, and so will the rest of your
family.

------
gabriel34
So, I uninstalled whatsapp a bit before the acquisition and have been
wondering if they sold my past messages along with their company; I really
hope that is not the case. I know draconian EULAs ToCs and "Privacy" Policies
are all legal, but I trusted them and prefer to give Facebook as little info
as possible.

~~~
gabriel34
a reply to myself and to future readers from whatsapp:
[http://blog.whatsapp.com/529/Setting-the-record-
straight](http://blog.whatsapp.com/529/Setting-the-record-straight)

------
tomp
The date at the bottom of the post is: "June 18, 2012".

------
ad80
Sooner or later the ads will come. Even if FB hadn't bought them, that is
usually the painful transition most social sites need to go through.

~~~
karangoeluw
Not if they are paid. app.net is a good example of that.

------
eloisant
"Because our business model is to get bought, not becoming profitable."

~~~
wdewind
Users pay $1/year after the first year. At almost half a billion active users
that's a pretty great business model.

~~~
awda
$500M/yr in raw revenue? How do you grow from there? Lower costs? Grow your
revenue? Half a billion is getting close to max adoption. Do you up your
prices?

~~~
rdtsc
I'll stick with just getting $500M/yr. That is more than most start-ups will
ever make.

Once I get there I can solve other problems as they come up. Would that be a
reasonable approach?

~~~
mcintyre1994
Elsewhere in this thread someone mentioned Whatsapp have $58M of funding, so I
doubt it - that'd probably be seen as a huge failure..somewhat amusingly.
Let's say them investors want their 10X within a few years so you need to pay
them over a year's revenue over a few years with no real growth there - you're
paying a lot and they'd probably not agree.

------
miog
....... Until they got sold to facebook

------
tyang
Selling ads isn't cool.

You know what's cool?

Giving your user info to Facebook to mine and monetize.

~~~
soci
I shiver of fear just thinking that my whatsapp chat data is crossed with the
info facebook has from my profile.

The worst is that I cannot convince all my address book list to not use
whatsapp anymore.

We are all in a trap!

