INSUBCONTINENT EXCLUSIVE:
San Francisco:
The billionaire chief executive of WhatsApp, Jan Koum, is planning to leave the company
after clashing with its parent, Facebook, over the popular messaging service's strategy and Facebook's attempts to use its personal data and
weaken its encryption, according to people familiar with internal discussions.Koum, who sold WhatsApp to Facebook for more than $19 billion
in 2014, also plans to step down from Facebook's board of directors, according to these people
The date of his departure isn't known
He has been informing senior executives at Facebook and WhatsApp of his decision, and in recent months has been showing up less frequently
to WhatsApp's offices on Facebook's campus in Silicon Valley, according to the people.The independence and protection of its users' data is
a core tenet of WhatsApp that Koum and his co-founder, Brian Acton, promised to preserve when they sold their tiny startup to Facebook
It doubled down on its pledge by adding encryption in 2016
The data clash took on additional significance in the wake of revelations in March that Facebook had allowed third parties to mishandle its
users' personal information.Facebook, though, needs to prove that its investment in WhatsApp - its largest acquisition ever - was worth
it.Facebook declined immediate requests for comment.Koum's exit would be highly unusual at Facebook
The inner circle of management - and the Board of Directors - have been fiercely loyal during the scandals that have rocked the social media
In addition, Koum is the sole founder of a company acquired by Facebook to serve on its board
Only two other Facebook executives - CEO Mark Zuckerberg and Chief Operating Officer Sheryl Sandberg - are members of the board.Acton left
He has joined a chorus of former executives critical of Facebook
Acton recently endorsed a #DeleteFacebook social media campaign that has gained force in the wake of the data privacy controversy sparked by
Cambridge Analytica, the political marketing firm tied to the Trump campaign, had inappropriately obtained the private information of 87
million Facebook users.Though the Cambridge Analytica revelations contributed to a climate of broader frustration with Facebook among
WhatsApp employees, Koum made his decision to leave prior to the scandal, the people said.WhatsApp, with 1.5 billion monthly users, is the
largest messaging service in the world
It is most popular in countries such as India, Egypt, and Brazil, and in Europe, where it is used for phone calls and text messaging with
friends and businesses, as well as news distribution and group chats.Koum and Acton, former coworkers at Yahoo, founded WhatsApp in 2009
It promised private communications for 99 cents a year
By 2014, the tiny company had almost 500 million users
It caught the attention of Zuckerberg, who was looking to expand the social network overseas
After a dinner at Zuckerberg's house, Zuckerberg made an offer for WhatsApp that turned Acton and Koum into instant billionaires.But even in
the early days, there were signs of a mismatch
WhatsApp had less than $20 million in revenues at the time of the acquisition
Facebook was making billions of dollars by selling advertisers access to its users, on whom it had collected large amounts of
information.Koum and Acton were openly disparaging of the targeted advertising model
In a WhatsApp blog post in 2012, they wrote that "no one wakes up excited to see more advertising; no one goes to sleep thinking about the
ads they'll see tomorrow." They described online advertising as "a disruption to aesthetics, an insult to your intelligence, and the
interruption of your train of thought."The WhatsApp co-founders were also big believers in privacy
They took pains to collect as little data as possible from their users, requiring only phone numbers and putting them at odds with
At the time of the acquisition, Koum and Acton said Facebook had assured them that WhatsApp could remain an independent service and would
not share its data with Facebook.How and if WhatsApp would make money was left an open question
"WhatsApp will remain autonomous and operate independently," the founders in wrote in a blog post announcing the acquisition
"And you can still count on absolutely no ads interrupting your communication."Eighteen months later, the promise not to share data
Facebook pushed WhatsApp to change its terms of service to give the social network access to the phone numbers of WhatsApp users, along with
analytics such as what devices and operating systems people were using.WhatsApp executives were comfortable sharing some data with Facebook
in order to measure who was using the service, according to the people
But they opposed using WhatsApp's data to create a user profile that was unified across Facebook's multiple platforms, which also include
Instagram and Facebook Messenger, and that could be used for ad-targeting or for Facebook's data-mining.Acton and Koum acquiesced enabling
Facebook to recommend that users' WhatsApp contacts become their Facebook friends, allowing Facebook to collect more data about those
The changes also allowed advertisers to feed lists of phone numbers into Facebook's advertising system, known as custom audiences, and find
new people to target with ads.Last year, the European Commission, the European Union's regulatory authority, fined Facebook $122 million for
making "misleading" statements when the EU approved the WhatsApp takeover.Conflicts soon arose over how WhatsApp would make money
Facebook scrapped the 99 cent annual charge, and Koum and Acton continued to oppose the advertising model
The service still has no ads, but WhatsApp has embarked on experiments to make money: In January, Facebook rolled out a tool, called
WhatsApp Business, to allow businesses to create a profile and send messages to their customers on WhatsApp
The founders also clashed with Facebook over building a mobile payments system on WhatsApp in India.Another point of disagreement was over
In 2016, WhatsApp added end-to-end encryption, a security feature that scrambles people's messages so that outsiders, including WhatsApp's
Facebook executives wanted to make it easier for businesses to use its tools, and WhatsApp executives believed that doing so would require
some weakening of its encryption.Ultimately, Koum was worn down by the differences in approach, the people said
Other WhatsApp employees are demoralized and plan to to leave in November, four years and a month after the Facebook acquisition, when they
are allowed to exercise all their stock options under the terms of the acquisition of Facebook, according to the people.Acton donated $50
million of his money to Signal, a rival messaging app that is geared toward security and privacy
In a recent blog post announcing his donation and role as the executive chairman of the non-profit Signal Foundation, Acton said his goal
was to build "the most trusted communications experience on the planet.(This story has not been edited by staff and is auto-generated from
