Facebook buys Instagram for $US1 billion
Social Networking site Facebook has announced it will pay $US1 billion to buy Instagram, a popular smartphone photo-sharing application.
The price is regarded as stunning for an app-maker without any significant revenue.
Facebook co-founder Mark Zuckerberg says the purchase is "an important milestone for Facebook" but promised it was a rare acquisition.
The purchase is the biggest Facebook has made and comes just months before it is expected to go public.
An Instagram application tuned to Apple's iPhones, iPads, and iPod touch devices has been downloaded more than 27 million times since the first version was released in late 2010.
Instagram co-founder Kevin Systrom released the figure last month while showing off a version of the application for Android phones.
The free mini-program lets people give classic looks to square photos using "filters" and then share them on Twitter, Facebook or other social networks.
Apple crowned Instagram its app-of-the-year for 2011.
"We're psyched to be joining Facebook," Mr Systrom said in a blog post Monday on the Instagram website.
"It's important to be clear that Instagram is not going away," he continued.
"We'll be working with Facebook to evolve Instagram and build the network."