Get ready for ads, Instagram users
The photo-sharing app hasn't earned a cent, and that's something corporate parent Facebook is determined to change.
As The Wall Street Journal noted, the wildly popular app has never made a cent. But Instagram's director of business operations, Emily White, told the paper the site will be ready to begin selling ads within the next year.
That's a stark change for Instagram, which "didn't even have the outlines of a business" when Facebook acquired it, The Journal reported. The enterprise employed 32, none of whom were involved with customer service, and only one person was working with the thousands of brands that were starting to use Instagram to promote themselves.
After the acquisition, White's team cataloged the major bands on the site and then met with the companies, according to the paper.
Figuring out how to balance the needs of advertisers with user expectations will be the key. Another challenge will be getting companies to pay for a service they get free today.
"After years without ads, Instagram's big risk is alienating its members -- especially its large base of teen and young adults, who are coveted by marketers," according to The Journal. "Too much overt marketing could clutter the service, undermining one of its strongest selling points."
Users are already starting to grumble. Last year, they denounced the site for changing its terms of service in a way that suggested user content could be turned into ads. Instagram later backtracked on its efforts.
Luckily for White, Facebook has a market capitalization topping $107 billion, so it doesn't immediately need Instagram to get into the black. But Wall Street, which has pushed up Facebook's shares 135% over the past year, will demand progress to justify the social network's lofty valuation.
Jonathan Berr does not own shares of the listed stocks. Follow him on Twitter @jdberr.
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
[BRIEFING.COM] The stock market capped the trading week with losses across the major averages. The S&P 500 fell 0.5% to surrender its weekly gain, while the Dow Jones Industrial Average (-0.7%) and Russell 2000 (-0.9%) underperformed. The two indices posted respective losses of 0.8% and 0.6% for the week.
Equity indices were pressured from the get-go after several heavyweights disappointed the market with their earnings and/or guidance, which led to some broader profit-taking. After ... More
More Market News
The idea of US crude being a shelter from turmoil abroad may not be as far fetched as it seems.
MUST-SEE ON MSN
- Video: Easy DIY smoked meats at home
A charcuterie master shares his process for cold-smoking meat at home.
- Jetpacks about to go mainstream
- Weird things covered by home insurance
- Bing: 70 percent of adults report 'digital eye strain'