Masterclassing Connect

WhatsApp Eliminates Annual Fee, Begins Testing Business Accounts

Tim Maytom

whatsapp-c.jpgFacebook-owned messaging app WhatsApp has announced it will be dropping it's annual $0.99 (£0.69) subscription fee as it tests additional enterprise-focused services that will facilitate B2C communication with customers.

The announcement came at the DLD conference in Munich, where Jan Koum, CEO of WhatsApp explained how eliminating the subscription fee for users was part of the company's next phase of evolution as it approached 1bn users globally.

"Starting this year, we will test tools that allow you to use WhatsApp to communicate with businesses and organisations that you want to hear from," said Koum. "We want to build things that are utilitarian, that allow a company like American Airlines or Bank of America to communicate efficiently through a messaging app like WhatsApp."

In a separate blog post, WhatsApp suggested that the functionality could enable companies to let customers know about delayed flights, or check if recent transactions were fraudulent.

Facebook acquired WhatsApp for £19bn almost two years ago, and Facebook CEO Mark Zuckerberg has said in the past that once the messaging solution reached 1bn users, additional ways of monetising the platform would be explored.

According the Koum, WhatsApp's B2C business is currently in the testing phase, with a focus on large corporate customers. While the removal of the annual subscription fee (which does not kick in until users have been active for a year) will see a drop in revenues, the company won't be turning to ads to make up for this dip.

WhatsApp's renewed commitment to not serving ads despite its relatively unique access to hundreds of millions of user phone numbers (something many apps lack) suggests it has a clear tactic in mind for gaining revenues from an alternative avenue.

While B2C messaging is a relatively untapped area for WhatsApp to explore, other apps like Slack will provide some competition, as will traditional SMS advertising, which still boasts some of the highest engagement rates in mobile marketing.