Tech

Snap shares plunge after Facebook's latest clone attempt

Key Points
  • Snap shares fell as much as 7% on Thursday after Facebook announced the launch of Threads, a new messaging app for Instagram users. 
  • The Threads app borrows several elements from Snap, whose Snapchat app focuses usage on sending photos and videos through private messages.
  • The launch of Threads could pose a problem for Snap due to the sheer size of Instagram, which claims more than 500 million daily active users. By comparison, Snap has 203 million daily users. 
Co-Founder and CEO of Snap Inc. Evan Spiegel.
Matt Winkelmeyer | Getty Images

Snap shares fell as much as 7% on Thursday after Facebook announced the launch of Threads, a new messaging app for Instagram users.

The camera-focused Threads allows Instagram users to share their status or quickly send photos and videos to people they've added to their list of close friends. The app borrows several elements from Snap, whose Snapchat app focuses usage on sending photos and videos through private messages.

The launch of Threads could pose a problem for Snap due to the sheer size of Instagram, which claims more than 500 million daily active users. By comparison, Snap has 203 million daily users.

CNBC

This isn't the first time Facebook has launched a Snapchat clone or a spin-off Instagram messaging app.

In 2012, Facebook launched an app called Poke that mimicked Snapchat, and it did it again in 2014 with an app called Slingshot. Neither app took off. Facebook tried once again in 2017 with Direct, a spinoff Instagram app focused on messaging that the company announced plans in May to shut it down.

Facebook's most successful clone of Snapchat was not an app but a feature that it built into the main Instagram app.

In 2016, Instagram announced Stories, a clone of a Snapchat feature with the same name that shows full-screen user photos and videos that disappear after one day. Facebook has since also added Stories features to the main Facebook app, Messenger and WhatsApp, with each of them now accounting for more than 500 million daily users, according to the company.

After a rough two years following its initial public offering, Snap has bounced back in 2019. The company has matured its advertising business, continued to build out its augmented-reality technology and renewed its focus on Gen Z users. As a result, the company's stock price is up more than 155% year-to-date.

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