According to technology blog VentureBeat the popular iPhone app photo offering cool retro filters for photos which quickly gained popularity in 2011 inspired a bidding war between the social media giants – causing Facebook to panic and swoop in with the enormous bid to ensure closure on the deal.
According to reports, CEO and co-founder of Instagram Kevin Systrom got a bid from Twitter first of all, then smelling a serious payoff he approached Facebook with the price doubled.
Twitter were pressurised into making the first offer by Systrom, Instagram’s parent company. Some commentators have suggested that the huge buyout came as a result of paranoia from Facebook’s Mark Zuckerberg.
It’s been suggested that the golden boy of silicon valley is concerned that Facebook’s dominating hold on the internet could be torn away at any time unless the company remains vigilant to constantly shifting online trends.
Twitter’s founder Jack Dorsey was an early investor in Instagram’s success – Dorsey probably benefited richly from the businesses sale to Facebook.
Instagram’s popularity spread even further last month when the Android version of the app arrived on the market, opening it up to a massive worldwide audience of smartphone users.