How Signal Protects Privacy & Makes Money Staying Free


Before the age of technology, it was relatively easier to lead a life private.

But as our lives become increasingly digital, maintaining personal privacy has become difficult and deserving of more time and thought than earlier.

These days, technology giants like Google and Facebook track and store data about us to enable advertisers to target us with ads efficiently. And it’s not just that.

Data breaches and inappropriate data sharing has become more and more common.

According to Wikipedia, a collection of 2.7 billion identity records were posted on the web for sale in 2019 alone, of which 774 million were unique email addresses and 21 million were unique passwords.

Even worse, it sometimes feels that you’re stuck in a perpetual catch-22 – either you like the convenience offered by these sites, or you value your privacy.

In many cases, you can’t have it both ways.

Fortunately, consumer demand for private interactions online has only increased, which means that there is a growing market for apps and websites that offer additional protections.

When it comes to messaging, Signal is one of the best options out there. As an open-source program, Signal has some incredible features that make it ideal for anyone looking to protect their information.

If you want to talk about private messaging apps, though, the conversation cannot avoid the elephant in the room – WhatsApp.

Today, we’re going to compare these two programs to see how they differ, as well as discuss the business model of Signal.

How Signal Works

Signal uses what’s called end-to-end encryption. This means that every message is coded through the app.

Best of all, Signal doesn’t have the key to that encryption, so the company can’t look at your messages if someone requested them.

Even better, Signal doesn’t store any information about you – like, at all.

When you start the program, you’re required to open up your contact list to see who else is using Signal.

The software uses a cryptographic hash function to conceal phone numbers within your contact list, and those numbers are truncated for further protection.

Signal also doesn’t store metadata or offer cloud storage for its users.

The best information that it can provide to a third-party is the day that a user logged in. You can’t even see a timestamp.

For users that value privacy above all else, the lack of a cloud-based backup means that no one can access your messages, not even you (if you lose your phone or get a new one).

That being said, Signal does allow you to import and export data locally if you have an Android, but iPhones don’t come with this feature.

Considering that WhatsApp is one of the most widely used messaging systems in the world, and Signal is still relatively new, there are some substantial differences between them.

Let’s break down the differences: 

User Base ( WhatsApp Vs Signal )

In July 2019, Techcrunch reported that WhatsApp had over has about 1.5 billion monthly active users worldwide, which also means finding people to communicate with on the program is easy. 

For those in the US, WhatsApp is not as popular as it is overseas, but you still have a high chance of finding some of your contacts that use it.

Not only that, but its ubiquity means that WhatsApp has strong network effects and convincing friends and family to download & use WhatsApp is not a challenge. 

Comparatively speaking, Signal’s user base is tiny.

According to Google Play, the app has been downloaded over 10 million times. However, Signal doesn’t publish usage data, so it’s difficult to know the exact number of active users.

No matter what, though, it pales in comparison to WhatsApp, so chances are that you’ll have to tell your friends about it and get them to download the app before you can get value from using Signal

Messaging Encryption ( WhatsApp Vs Signal )

Both WhatsApp and signal use end-to-end encryption to encrypt data messages sent between users, both individually and in group chats. 

In fact, WhatsApp uses the Signal Protocol, which has been developed by Signal, to provide end-to-end encryption.

Since WhatsApp uses the same open-sourced software as Signal, both messaging apps are quite similar in terms of how they encrypt user messages.

In 2016, WhatsApp started providing full encryption on all messages, including multimedia ones with pictures and video clips, which was enabled by a partnership with Signal.

On the other hand, Signal has always been using end-to-end encryption.  

What’s interesting about Signal, though, is that you have to change the settings for the program to save any images or videos to your phone.

As an added method of protecting your information, Signal won’t do this automatically, both with messages you send or receive. 

Metadata ( WhatsApp Vs Signal )

According to the WhatsApp’s privacy policy, “WhatsApp may retain date and time stamp information associated with successfully delivered messages and the mobile phone numbers involved in the messages, as well as any other information which WhatsApp is legally compelled to collect.”

This means that your contact list can be stored and accessed later on.

While the company cannot read your messages, this may be enough to cause some concern among the privacy-minded out there. 

On the other hand, Signal does not store any metadata.

The only thing that Signal server stores are the last time a user connected to the server and even that information is reduced to the day in terms of precision, not the hour, a minute or the second.

Cloud Storage ( WhatsApp Vs Signal )

As with other messaging apps, WhatsApp can connect to your Google Drive or iCloud account.

If you have set up automatic backups, messages stored on your phone (including images or video clips) will likely be uploaded.

You can change your phone’s settings to prevent this from happening though if you’re concerned about third-party access. 

One thing to keep in mind with end-to-end encryption is that it only works in the software itself.

Once the messages are outside of WhatsApp (i.e., in the cloud), anyone can hack into your account. And as we know, Apple and Google are also not exactly secretive when it comes to storing and tracking data, so backup your messages at your own risk. 

Signal, on the other hand, doesn’t have this problem. You can’t store messages on your phone, although you can download and save pictures and video files.

Overall, this means that there is no potential security breach within Signal itself. \For someone to read your messages, he or she will have to break into your phone and look at them within the app. However, there’s a way around that too. 

The program comes with a feature called “disappearing messages.” This feature will delete your data based on a preset amount of time, such as five seconds or five days.

Utilizing this option can protect your messages on your device, just in case you’re worried about theft. However, you will also need to encourage your contacts to follow suit, as their devices can be potential liabilities if they don’t delete your conversations. 

How Signal Makes Money

Here is where Signal and WhatsApp differ the most.

Facebook owns WhatsApp, and even though the app is ad-free as of now, Facebook has announced that ads will be coming to WhatsApp in 2020, as a part of app’s statuses.

Due to disagreements over monetizing WhatsApp through ads and protecting user privacy, both the founders of WhatsApp resigned from Facebook.

Brian Acton, one of the co-founders of WhatsApp, even went on to invest $50 Million Into Signal.

As far as WhatsApp’s revenue is concerned, accurate earning statements are hard to come by, but WhatsApp’s revenue currently comes from businesses utilizing the service to communicate with customers directly, and the company also plans to integrate payments into the app.

Regardless of its money-making power, WhatsApp is still a for-profit business. Facebook bought the app for a whopping $19 billion, and as the user base continues to grow, it will only become more of a potential cash cow. Remember, Facebook is still free to use, but it makes boatloads of cash. 

Signal, however, is a non-profit organization. This lack of a business model is a significant reason why the app is so focused on privacy. Since the company isn’t trying to make money, it can exist for the sole benefit of the user. 

Instead of earning a profit, Signal relies on donations to stay up and running. Also, because the program is open-sourced, developers can go in and offer patches and solutions, all without racking up a substantial bill (similar to Wikipedia or WordPress). 

One average, there have only been 2-3 developers on the Signal team, and the entire team has never been bigger than 7 people.

But the $50 Million Signal got from WhatsApp’s co-founder Brian Acton in Feb 2018 is expected to help Signal increase the size of the team and their ambitions.

Thank you for taking the time to read the entire article.

If you liked it, you might also like our article on WhatsApp’s Business Model.

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How Signal Protects Privacy & Makes Money Staying Free
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How Signal Protects Privacy & Makes Money Staying Free
Signal, however, is a non-profit organization. This lack of a business model is a significant reason why the app is so focused on privacy. Since the company isn’t trying to make money, it can exist for the sole benefit of the user.
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