Could Facebook get revenge on Snapchat by bringing it down with a competing picture app of its own?
Snapchat, a photo messaging application for mobile devices, was developed by Evan Spiegel and Robert Murphy as a class project when the two were students at Stanford University. The app allows users to take photos and record videos and add text and drawings to them. These pictures, known as snaps, can then be sent to a controlled list of recipients.
Users of Snapchat can set a time limit on how long people can view their pictures and videos, anywhere from 1 to ten seconds. After the time limit has expired the pictures are deleted from Snapchat’s servers. As of this month Snapchat’s users are sending 700 million photos and videos each day.
But Snapchat has had its share of controversy. Recently it was revealed that a security flaw could allow hackers to identify the personal details of millions of its users. Also, while the company claims that the pictures are always deleted, some, it turns out, could be copied and saved.
This month the company reached a deal with the Federal Trade Commission in which it promised to better inform its users in its disclaimers.
These problems have opened the door to possible competitors and now Facebook wants to get a piece of this action. The company is developing its own video chat app which it is calling slingshot. This according to a report in the Financial Times on Sunday. The move comes after Snapchat’s owners rebuffed offers from Facebook to buy out the company for a reported $3 billion. Facebook has already acquired several successful app makers like Instagram.
But after the rebuffing of Facebook, Snapchat raised an additional $50 million in a Series C funding last December from a single investor.
According to the Financial Times, Facebook has been working on slingshot for several months and the new app could even be launched this month. But Mark Zuckerberg, Facebook’s CEO, is not sure that he wants to go forward with it.
Snapchat may hold the copyright on the computer code which it uses, but it does not have a patent on the idea. Facebook and any other company is free to try and compete with Snapchat by copying the idea, but Snapchat already has a huge head start on any possible competitor: its millions of current loyal users. In this respect, getting there first is important.
The question that people have been asking this past year is, “did Snapchat make a terrible mistake in declining Facebook’s offer.” After all, when Facebook comes knocking at your door with a check ready to buy your company most people in the high tech industry view it as an “offer you can’t refuse.”
Mark Zuckerberg has proven over the years that he knows how to play tough.
If Facebook decides not to pursue slingshot, or if it does and the app fails, then Snapchat will clearly have made the right move. But if Facebook, with its current user base of hundreds of millions of people world wide, succeeds then Snapchat may disappear. Just remember the examples of companies like My Space and Netscape.
In spite of not yet having a revenue stream, Snapchat has been valued at as much as $3 billion.
Having left Stanford University only three courses shy of graduating to pursue his new business, Evan Spiegel is the CEO of Snapchat. The 23 year old is a California native and a graduate of the Crossroads School for Arts and Sciences in Santa Monica.