Instagram and WhatsApp’s large user base and high engagement levels suggest a large revenue potential for Facebook (FB).
Instagram is a mobile online photo sharing, video-sharing social network service that allows users to take photos and videos and share them on its platform. Given growing use of photo sharing, we see Instagram as a well-positioned as a social and mobile platform play, and a nice compliment to the Facebook audience given a younger demographic profile of the site.
Instagram has exceeded with 300mn MAUs expectations. Site activity is impressive with 70mn photos shared per day and 2.5bn daily likes. Globally, users spend over 20 minutes per day on Instagram, which sets the foundation for material advertising dollars. We see a $4bn+ revenue opportunity and potential valuation range for Instagram at $30bn – $37bn based on user and potential revenue comparisons to
