Instagram CEO Kevin Systrom, CTO Mike Krieger quit

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Instagram's growth over the past few years had a lot to do with its strategic positioning to Facebook; leveraging the latter's engineering resources whilst maintaining a sense of independence from Zuckerberg's social network.

That doesn't have to be a bad thing, even for users who prefer Instagram to Facebook.

Just before going public Facebook bought Instagram in 2012 for $1bn - considered an eye-watering sum that year - for a less than two-year old startup with no revenue but 31 million mobile users. Facebook is walking a tightrope in trying to monetize the usage of both WhatsApp and Instagram without altering their core strengths.


Zuckerberg said in his own statement: "Kevin and Mike are extraordinary product leaders and Instagram reflects their combined creative talents". Instagram largely operated as a standalone company within Facebook, and now some of that autonomy could disappear.

Yet Zuckerberg's Facebook has to make sure it doesn't become akin to a swarm of locusts, moving from platform to platform and turning each one to a husk. But because of Facebook's dependence on automation, the more ads you get, the spottier quality becomes - and the greater the likelihood of repulsing users.

What has the social media chatter been?


Mr Koum's departure sparked an executive reshuffle that saw the tightening of Mr Zuckerberg's control over operations. Concerns over Facebook's business sparked the biggest one-day wipeout in US stock market history in July. It's fair to say that Instagram could have died as a little start-up in Facebook's long shadow, and it definitely benefited from the discipline, infrastructure and advertising sales machine that it accessed as a semi-autonomous region inside of mother Facebook.

The Instagram news feed, once a selective platform for glossy magazine-like ads for marquee brands, expanded its offering over the years to more advertisers, adding video and "shoppable" formats, where users can immediately click to buy items. Facebook's main app has been marred by scandals around privacy, the Cambridge Analytica issue, and the spread of fake news. "We look for additional color in coming days and weeks, but in the near-term, we expect FB shares to come under meaningful pressure from the departures". While not particularly revealing, the measurement underscores the growing importance Facebook places on those secondary apps.

"We believe their departure comes as a surprise given Instagram's success and its growing importance within Facebook", said Doug Anmuth in a JP Morgan note to clients on Tuesday.


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