WhatsApp was Launched in 2009 by Brian Acton and Jan Koum as an alternative to expensive SMS services. The application allows users to upload their phone book contacts and send message to anyone who has the app installed for free. It is available for iPhones, Androids, Blackberries, Windows Phones, Nokia ( NOK) phones and, most recently, desktops computers

THE BEGINNING
WhatsApp had dabbled with the subscription revenue model in 2014, which amounted to charging an annual $0.99 membership fee, and the company earned above $1 billion in the first nine months of instating this fee. But following their $19-billion acquisition by Facebook, they came to revoke these charges, and WhatsApp was a free ride for its one-billion-strong and counting user base again.

According to reports, the revenue generation for Whatsapp is solely through database management . All the conversations on Whatsapp between users are backed up on Whatsapp servers constantly. Our conversations reflect our interests, likes, dislikes and majorly depicts our preferences. This information is invaluable to big firms where relevant tailor made products can be offered after data sorting. With such extensive information available on Whatsapp backups, the big companies are willing to pay handsome amounts for information extraction.

This data management scheme is merely a speculation. As evident, Whatsapp is not involved in ad marketing. Any user can vouch for the fact that it does not support advertisements. Whatsapp’s CEO Jan Koum clearly states that Whatsapp is meant for instant messaging and forcing advertisements would disrupt the sole meaning of that. There is no way to justify the data management ideology, but then there is no other justified revenue model as well in the store.

WhatsApp at this moment CANNOT directly sell our data for advertisement because WhatsApp does not have our data . Why? WhatsApp messages are end-to-end encrypted
Although most of us are baffled by the $19 billion dollar acquisition of WhatsApp by Facebook, it is no surprise that Mark Zuckerberg agrees with Jan Koum’s business strategy. Here is a quote from Zuckerberg back in 2014:

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