Mergers and acquisitions aren’t a new term in the business world. Nowadays, new M&As (mergers and acquisitions) could happen to any company in the world, from a small scale startup business emerged from Kickstarter until a huge multinational company like Intel. M&As, or sometimes addressed as integration, is often addressed as a voluntary consolidation of two or more firms upon agreed requirements to create one new legal entity (businessdictionary.com). If the merged firms were competitors or, this is called horizontal integration or merger, if they were unequal in size and capabilities, it is called vertical integration. On 19th February 2014, just days after the world’s Valentine’s day, Facebook, a social media giant, has wrapped up the …show more content…
WhatsApp, even though its popularity surpassed Facebook’s Messenger, is just an instant messaging platform. By comparing these two companies side by side, it can be said that Facebook is trying to integrate WhatsApp into one of Facebook’s services. Therefore, this merger belongs to vertical integration. However, as a result of this merger, Facebook has given the authority for WhatsApp for running independently instead of being integrated into Facebook’s messaging system. This leads to consumers not aware of this merger and did not affect negatively to both …show more content…
On the other hand, acquiring WhatsApp could also mean that Facebook is trying to eliminate one of its potential future rival, as WhatsApp and Facebook Messenger is competing on the same league, with a little difference in their audiences. If Facebook had not acquired WhatsApp, WhatsApp may now be a bigger competitor than before, and could endanger Facebook’s position in the social networking industry. And by combining the user bases of both Facebook and WhatsApp, they are now dominating the market share (Brugger, 2015). What if Facebook had chosen not to buy