Facebook is smart to separate itself from WhatsApp, Instagram

Despite scrutiny over Facebook’s practices on how it addresses misinformation or protects user information, its stock has provided great returns for investors in the past five years.

Ramona Pringle, a tech expert and associate professor at Ryerson University, says any time the company did see a dip in its stock, it’s always because of a scandal affecting the company publicly. She also says that when we’re looking at Facebook’s stock, we’re not looking at it as Facebook proper, but Facebook as an entire company and “oligarch.”

“They’ve been really clever in knowing which platforms to acquire. WhatsApp certainly internationally is very actively used probably more internationally than it is here in Canada. They don’t have all their eggs in one basket, let’s put it that way and I think it has benefited them,” she said.

In December, the Federal Trade Commission in the U.S. and 46 states sued Facebook, accusing the company of buying out smaller payers in order to squash competition in the social media industry. Pringle adds that it’s been good business for Facebook to keep WhatsApp and Instagram as separate entities and not marketing them as Facebook products. She said Facebook will do what it needs to do to protect its business.

“When it comes to things like anti-trust and competitiveness… the fact that they own so many of the most popular, most powerful social media platforms, they know what they’re doing and in that sense when you step back and look at it objectively, just in terms of a business that they’re running, and that growth that we see in charts, they’re doing a good job of it,” she said.