Facebook has acquired the popular photo-sharing application Instagram for approximately $1 billion, the company announced on Monday.
The deal arrives on the eve of Facebook's initial public offering, and Instagram will get shares in the social networking giant as part of the deal.
Facebook CEO Mark Zuckerberg said Instagram would be operated as an independent company. "We're committed to building and growing Instagram independently," he said in a post on Facebook. "Millions of people around the world love the Instagram app and the brand associated with it, and our goal is to help spread this app and brand to even more people."
The acquisition is a remarkable price for a mobile application, and underscores how quickly mobile has come to dominate the focus of tech companies.
Instagram is an application that allows users to upload photos and enhance them with different filters, and share them with friends across most major social media platforms.
Launched in October of 2010, Instagram has already accrued more than 30 million users, even though it had only been available on the iPhone and iPad until last week. Following the path of many apps, it established a foothold with the Apple products and then launched an Android version.
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After the launch of the Android app, Instagram reportedly secured an additional $50 million investment round, which valued the company at $500 million. All that despite a lack of revenue. Instagram is a free app and does not yet have ads.
Twitter is another social networking phenom that began to monetize itself after luring a large user base, but it has a website. Instagram is only available on mobile phones and tablets.
Though Zuckerberg pledged that Instagram will retain its independence, Facebook does appear to be a logical parent company. It too serves as a platform for sharing photos, as users upload photos of everything from family trips to college parties.
Here is the note from Facebook CEO Mark Zuckerberg:
I'm excited to share the news that we've agreed to acquire Instagram and that their talented team will be joining Facebook.
For years, we've focused on building the best experience for sharing photos with your friends and family. Now, we'll be able to work even more closely with the Instagram team to also offer the best experiences for sharing beautiful mobile photos with people based on your interests.
We believe these are different experiences that complement each other. But in order to do this well, we need to be mindful about keeping and building on Instagram's strengths and features rather than just trying to integrate everything into Facebook.
That's why we're committed to building and growing Instagram independently. Millions of people around the world love the Instagram app and the brand associated with it, and our goal is to help spread this app and brand to even more people.
We think the fact that Instagram is connected to other services beyond Facebook is an important part of the experience. We plan on keeping features like the ability to post to other social networks, the ability to not share your Instagrams on Facebook if you want, and the ability to have followers and follow people separately from your friends on Facebook.
These and many other features are important parts of the Instagram experience and we understand that. We will try to learn from Instagram's experience to build similar features into our other products. At the same time, we will try to help Instagram continue to grow by using Facebook's strong engineering team and infrastructure.
This is an important milestone for Facebook because it's the first time we've ever acquired a product and company with so many users. We don't plan on doing many more of these, if any at all. But providing the best photo sharing experience is one reason why so many people love Facebook and we knew it would be worth bringing these two companies together.
We're looking forward to working with the Instagram team and to all of the great new experiences we're going to be able to build together.