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The acquisition of young businesses by Facebook (FB) has slowed considerably. Facebook has only bought two startups to date in 2019, according to Crunchbase data. In contrast, Facebook acquired four startups in the first half of 2018 and six more in 2018.
Facebook acquires Servicefriend to strengthen its subsidiary Calibra
The latest acquisition of Facebook is Servicefriend, an agreement revealed last Sunday. Servicefriend is an Israeli startup that develops chatbots for customer service. According to a TechCrunch report, the Servicefriend team has joined Facebook's Calibra financial services unit.
Facebook unveiled Calibra in June as a subsidiary in which it plans to provide financial services around Libra cryptocurrency. Facebook hopes that Libra and Calibra will be able to boost its central advertising business. In addition, the company relies on Calibra to help it generate non-advertising revenue.
Facebook is heavily dependent on advertising for the majority of its revenue. However, the company wants to diversify its sources of income outside the advertising market. The Balance project has encountered regulatory resistance worldwide, threatening the company's plans for Calibra.
Facebook acquisitions slow down in the face of increasing regulatory scrutiny
The slowdown in Facebook's acquisitions comes as the company faces increasing regulatory scrutiny. The company is currently the subject of antitrust investigations by several states, as well as by the FTC (Federal Trade Commission) and the Department of Justice.
the the Wall Street newspaper reported on August 1 that the FTC was reviewing Facebook's acquisition practices as part of its antitrust investigation. According to the report, the FTC wants to know if Facebook buys potential rivals to neutralize the competition.
Facebook's hard-hitting boot purchases
Among the Facebook acquisitions that have had a considerable global impact, we can mention Instagram and WhatsApp. Facebook acquired Instagram for $ 1.0 billion in 2012. Instagram then had only 30 million users.
Instagram currently has over 500 million daily users and 1 billion monthly users. This makes Instagram bigger than Snapchat, Twitter and Pinterest. Plus, Instagram has attracted millions of advertisers.
WhatsApp had about 460 million monthly users by the time Facebook acquired it for $ 19 billion in 2014. WhatsApp currently has more than 1.5 billion users.
The slowdown in Facebook's acquisition program is also explained by the fact that the company is investing heavily in expanding its infrastructure. Facebook is currently developing its first Asian data center in Singapore and plans to spend more than $ 1 billion on this project. In addition, Facebook plans to build an underwater cable ring around Africa as part of a project that may cost more than a billion dollars.
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