Monday, April 16, 2012

Why Instagram Is So Valuable


It was a few months ago when I started to see my friends post pictures that have been edited with these filters that made their photos seem warm and nostalgic.  I ignored the name Instagram the first time. But as I saw more and more Instagram pics pop up on my Facebook feed I knew I was doomed to follow along. I wanted those cute filters too. 
To my delight, I was on it and snapping away pics of my kids via Instagram on my old IPhone 3GS in no time. With a tap of a button I could post a pic that made it seem as though I fiddled away on Photoshop for a good while. Who wouldn’t find value in an app that would enable such an awesome document of life with such ease.
With it’s recent Android platform addition the expected Instagram patronage is expected to surpass the 50 million user mark.  Its patronage alone is the key value to this 2 year old company that easily poses a threat to all other social networking sites.  “"Anytime you see a social platform that's growing that quickly, that's got to be cause to be nervous," said Paul Buchheit, a partner at the start-up incubator program Y Combinator and a co-founder of FriendFeed, which Facebook acquired in 2009.” (Facebook to buy Instagram for $1 billion by Alexei Oreskovic and Gary Shih: Reuters)
"Facebook is acquiring a similar company in that it's fast growing, doesn't have revenue or a business model, but has become part of the online culture," said Gartner analyst Ray Valdes. (Facebook to buy Instagram for $1 billion by Alexei Oreskovic and Gary Shih: Reuters)

"I would wager that almost everyone is also a Facebook user, so it's not like they're expanding their market," Valdes said of Facebook. "What they're buying is traction, they're buying engagement, they're buying brand value." (Facebook to buy Instagram for $1 billion by Alexei Oreskovic and Gary Shih: Reuters)

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