Signaling the importance of mobile smart phone applications among key players in the Internet world, online social networking giant Facebook agreed on Monday to purchase Instagram, a popular mobile photo sharing service, for $1 billion in cash and stock. Since its debut in October 2010, Instagram has surged in popularity among iPhone users, who use the Instagram application to customize and share photos taken with their smart phones. Instagram currently boasts more than 30 million registered users and last week released an application for Android smart phones that has already brought in millions more users. Although Instagram has only a dozen employees and has yet to record any revenues, the company has exploded in value over the past year from approximately $30 million in February 2011 to more than $500 million as of last week. Recalling Google’s 2006 acquisition of YouTube in a $1.6 billion deal that placed the online search giant at the forefront of the online video industry, observers anticipate that the Facebook Instagram deal will provide Facebook and its 845 million worldwide users with a key platform for expanding photo sharing and other popular Facebook functions into the wireless realm. The deal is also expected to lend even greater significance to the Facebook name as the company prepares for its initial public offering. Describing the deal as a “milestone,” Facebook CEO Mark Zukerberg told reporters: “providing the best photo sharing experience is one reason why so many people love Facebook, and we knew it would be worth bringing these two companies together.”