Facebook Buys Instagram for $1 Billion

This morning, many of us woke to the disappointing announcement that social networking giant Facebook had purchased photo sharing app Instagram for a huge pile of cash.

Just how much cash? A whopping $1 billion dollars, plus Facebook stock. Is this the end of Instagram as we know it?

Both Facebook CEO Mark Zuckerberg and Instagram CEO Kevin Systrom made statements to reassure Instagram users that Instagram will remain an independent entity.

Here’s what Systrom had to say:

“It’s important to be clear that Instagram is not going away. We’ll be working with Facebook 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.”

And Zuckerberg:

“We believe these are different experiences that complement each other. But in order to do this well, we need to be mindful about keeping and building on Instagram’s strengths and features rather than just trying to integrate everything into Facebook.That’s why we’re committed to building and growing Instagram independently. Millions of people around the world love the Instagram app and the brand associated with it, and our goal is to help spread this app and brand to even more people.”

Of course, similar statements were made by Facebook when it acquired location-sharing app Gowalla in December of 2011, and then shut it down just months later in March of 2012. Gowalla, which was always overshadowed by Foursquare, was a much smaller company, so there is hope that Instagram will remain untouched.

Instagram, as a major player in the social networking arena, should be a huge boost to Facebook’s upcoming IPO, where the company is expected to be valued at more than $100 billion. Currently, Instagram has more than 27 million iPhone users, a number that’s only going to climb now that an Android version is available as well.

What does this mean for us Instagram users? I’m hoping it won’t change much at all, and that Instagram will remain largely the same, but there’s no way to tell if Facebook will keep its word and leave the photo sharing site intact. Worst case scenario? Facebook shuts down the service and incorporates its features into the Facebook mobile app. It would also be a tragedy if Facebook’s mobile developers get their grubby hands on Instagram, because we all know how terrible Facebook mobile is compared to Instagram’s well-designed interface.

This acquisition also means that Facebook is inescapable. Facebook is going to have access to all of Instagram’s data, so if you’re an Instagram user and a staunch Facebook avoider, this is the time to stop using the photo sharing app. The deal is set to close later this quarter, so if you don’t want Facebook to have your information, you may want to look into deleting it.

Will Facebook leave Instagram untouched, or is this just a way for the company to eliminate its competition? Let us know what you think about the takeover in the comments.

About Juli: Contact me via Twitter: @julipuli