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Is Snapchat worth a third of Motorola!?

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snapchat-androidGoogle made news when reports surfaced that it tried to buy Snapchat for $4 Billion . This was the final bid after Facebook tried it’s luck at $3 Billion and was turned down by Snapchat.

Wall Street Journal reported earlier this week that Facebook trying to buy a company with $0 revenue would be a massive mistake for Facebook. The question is why would Google or Facebook shell out so much money for a service that doesn’t have any revenue, never mind profits?

Facebook’s biggest problems are decreasing interest among young users,  massive transition to mobile slowing growth. Acquiring Snapchat, which is growing exponentially would only mean getting back the last bits and hitting new milestones in terms of mobile users.

Any which ways we see these Giants competing each other to bring the youth to use their services to increase revenue. In this rat race do you think investing dollars like those make sense?

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Written by Chintan Vithlani

November 16th, 2013 at 7:41 pm