Facebook Buys Instagram for $1 Billion

InstagramOver the past week, Instagram the popular photo sharing application has made a few changes. It is now available to android users as well as iPhone users and has allowed the social network Facebook (FB) to purchase this app for $1 billion in cash and stocks on Monday afternoon.

FB has grown to be the largest social networking site in the world and although the two companies have merged, they insist the two would remain independent. “We’re committed to building and growing Instagram independently,” FB CEO Mark Zuckerberg said on his FB feed Monday.

For example, Instagram users will continue to have the ability to share photos to other social networking sites besides FB (and also abstain from sharing Instagram photos with FB), and will be able to keep their Instagram follower lists separate from their FB friend groups.

On the Instagram Company blog, chief executive Kevin Systrom also stressed that Instagram will keep its independence, saying his team will ?be working with FB to evolve Instagram and build the network.? ?We?ll continue to add new features to the product and find new ways to create a better mobile photos experience.?

Many users have expressed that there might be a negative effect on Instagram. This negativity is based on history. In the past few years, FB has bought several companies, but then raided the firms for their talent, while shutting down their services, such as the location-based check-in service Gowalla, group messaging application Beluga and live-event service Hot Potato.

Zuckerberg believes that this is an important milestone for FB, ?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 FB and we knew it would be worth bringing these two companies together.

Although some of Instagram users aren?t too happy about this merge, it this may be a great business move for FB. The transaction between the two companies is expected to close later this quarter.

Read more at The New York Times.