How does Whatsapp make money when its services are free?
WhatsApp currently makes money through WhatsApp for Business and WhatsApp Pay.
WhatsApp makes money through WhatsApp for Business API by charging registered businesses for slow replies. It charges companies anywhere between $0.05 to $0.90 for every message that is answered.
Businesses are allowed to respond to messages from users for free for up to 24 hours but are charged a fee per message for delayed responses, which varies by country.
WhatsApp also makes money through WhatsApp Pay by charging businesses a flat 3.99% fee per transaction.
WhatsApp Pay is a Peer-to-Peer (P2P) payments solution that is a free service for the ends users, only the businesses are charged a flat 3.99% fee per transaction.
Currently, WhatsApp Pay is available in Brazil and Indian markets.
Before Facebook acquired WhatsApp in 2014 for $19B, WhatsApp made money by charging a $1 per year subscription fee (sometimes offering the first year for free).
However, since 2016, WhatsApp has been completely free for everyone.
As of 2018, WhatsApp made very little money compared to its user base, as the service remained free and free of ads.
In 2014, Facebook reported that WhatsApp made approximately $1.2M on subscriptions
How WhatsApp Plans to Make Money in the future
Going ahead, WhatsApp plans to further monetize the app by introducing ads in the status section and rolling out WhatsApp Payments in other countries.
How much money does WhatsApp make?
Nobody knows how much revenue exactly WhatsApp generates except Facebook because the parent company does not share the revenue breakdown of the different products it operates.
WhatsApp doesn’t yet monetize heavily but will do so in the near future with the Business products they are building.