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WhatsApp Introduces Ads in Its App

They will appear in only one part of the Meta-owned messaging service, it said. The move is potentially lucrative, while raising questions about user privacy. updates.”

 

On Monday, WhatsApp said it would start to show advertising inside its app for the first time. CreditCredit...Video by Meta
On Monday, WhatsApp said it would start to show advertising inside its app for the first time. CreditCredit...Video by Meta

When Facebook bought WhatsApp for $19 billion in 2014, the messaging app had a clear focus. No ads, no games and no gimmicks.

For years, that is what WhatsApp’s two billion users — many of them in Brazil, India and other countries around the world — got. They chatted with friends and family unencumbered by advertising and other features found on social media.

Now that is set to change.

On Monday, WhatsApp said it would start showing ads inside its app for the first time. The promotions will appear only in an area of the app called Updates, which is used by around 1.5 billion people a day. WhatsApp will collect some data on users to target the ads, such as location and the device’s default language, but it will not touch the contents of messages or whom users speak with. The company added that it had no plans to place ads in chats and personal messages.

 

Nikila Srinivasan, wearing a bright red and purple outfit, looks at the camera while sitting on a chartreuse block in an outdoor plaza.
“Your personal messages, calls and statuses, they will remain end-to-end encrypted,” said Nikila Srinivasan, vice president of product management at WhatsApp.Credit...Clara Mokri for The New York Times

 

“Thinking through the lens of privacy was incredibly important for how we thought about bringing these features to market,” said Nikila Srinivasan, a vice president of product management at WhatsApp. “Your personal messages, calls and statuses, they will remain end-to-end encrypted.”

In-app ads are a significant change from WhatsApp’s original philosophy. Jan Koum and Brian Acton, who founded WhatsApp in 2009, were committed to building a simple and quick way for friends and family to communicate with end-to-end encryption, a method of keeping texts, photos, videos and phone calls inaccessible by third parties. Both left the company seven years ago.

Since then, Mark Zuckerberg, the chief executive of Facebook, now Meta, has focused on WhatsApp’s growth and user privacy while also melding the app into the company’s other products, including Instagram and Messenger. Putting ads into WhatsApp opens a lucrative opportunity for Meta, which has been spending billions on artificial intelligence and other pursuits, while potentially raising questions about privacy.

In a statement, Will Cathcart, the head of WhatsApp, assured users that the app would remain secure and guard their privacy.

“We work hard to protect the privacy of people’s communications,” he said. “Some people only use WhatsApp for private chats and calls, and nothing is changing about that.”

WhatsApp, which unveiled the changes at the Cannes Lions advertising industry conference, also said it was introducing paid monthly subscriptions for content creators, similar to offerings from competitors like X, YouTube and Twitch. The app will also let users and businesses advertise their “channels,” which are one-way broadcasts that can be sent to large groups of people.

 

A presentation image shows three phone screens side by side. They are labeled “Promoted Channels,” “Channel Subscriptions” and “Ads in Status.”
WhatsApp said it was debuting paid monthly subscriptions for content creators, among other product changes.Credit...Meta

 

In recent years, Meta has leaned into sources of untapped revenue. It introduced paid subscription services for creators on Instagram and Facebook, and is starting to show ads on Threads, its text-based social media app.

Meta also makes money from WhatsApp through its other products. On Facebook and Instagram, businesses can buy “click to message” advertising, which redirects users to WhatsApp or Messenger to chat directly with a business. It is a multibillion-dollar revenue stream.

Meta’s ad business is “in as strong a position now as it’s ever been,” said Brian Wieser, an analyst and founder of the consulting firm Madison and Wall. The company’s share of the global digital ad business is around 15 percent, he said. Last year, almost all of Meta’s $164 billion in revenue came from advertising.

Mr. Wieser said there was no precedent for directly commercializing a messaging app the size of WhatsApp, but added that it could be a large business opportunity. “It’s a market that doesn’t really exist right now,” he said.

WhatsApp, however, may not be able to charge as much for ads as Facebook and Instagram, which targets them by collecting vast amounts of user data, said Minda Smiley, a senior social media analyst at eMarketer, a market research firm.

“Since privacy has been such a tent pole of WhatsApp’s business model, I think there’s definitely some challenges” with pursuing an advertising model, she said.

WhatsApp has long promoted itself as a safe alternative to apps like Telegram and Google’s Android messaging. Users flocked to the app globally, finding it a cheap and secure alternative to texting, particularly people in unstable political climates and authoritarian countries, since its messages cannot be easily intercepted without access to personal devices.

The introduction of ads may call attention to WhatsApp’s previous stumbles with privacy. In 2021, the company proposed changes to its terms of service that some users interpreted as more data sharing. The revisions incited a global backlash.

This time, WhatsApp braced for pushback, saying any data sharing with other Meta-owned apps for ad targeting was optional. Users can choose to link their WhatsApp, Instagram and Facebook accounts, so ads on WhatsApp can be based on data collected from those platforms, Ms. Srinivasan said.

Last week, WhatsApp joined Apple in a legal fight against regulators in Britain who have been trying to break encryption across messaging apps. British lawmakers have said the move is a way to protect citizens against illegal activity on the apps.

In a 2023 interview with The New York Times, Mr. Cathcart said he would fight “tooth and nail” against any country that wanted to weaken WhatsApp’s encryption.

“This is a bedrock of what we are,” he said. “It will never change, even as we add updates.”

Author: Eli Tan and Mike Isaac Reporting from San Francisco

Source: N.Y Times

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