The Reasons for Upcoming Metamorphosis of Facebook
Facebook has shed about $25 billion of market capitalization after Mark Zuckerberg’s decision of adjusting its primary newsfeed to focus more on content from friends instead of publishers. It’s obvious that CEO and the board of directors were guessing such consequences.
At his post Mark Zuckerberg paid attention to the strengthening our relationships. “The research shows that when we use social media to connect with people we care about, it can be good for our well-being.” I’m sure it’s true, but when the changes entail the movement of billions of dollars there are should be other reasons to make that changes, not just altruistic. I see the following reasons:
- For the last five years, according to multiple sources, Facebook has lost “friend and family sharing” to other social platforms including Snapchat, Instagram, iMessage, and others. “Time spent in Facebook has been declining for the past couple years for the first time ever,” the former senior employee said. If the percentage of friend/family content gets too low then people don’t find Facebook valuable anymore.
- According to Pew Research Center, consumption of news steadily grows in online to the detriment of television, and two-thirds of Americans are already getting news from social networks. The essential thing for Facebook is that news instances spurred by emails and texts from friends or family elicited the most activity.
- It’s known that in 2013 more than 200 publishers like The Huffington Post, BuzzFeed, The Onion have reported about the growth of referral traffic from Facebook for 69% during the period from August to October. More important that enormous traffic appeared before Twitter’s IPO. Maybe just it is time to lower once artificially raised bar in a fight for the attention of brands?
- Admission of defeat in war with fake news. Facebook tried for years to make it work for the platform. It hired trending news curators. It worked with publishers, paying them to create live content and it hosted their articles. And now suddenly decided to bury all results? — No! Facebook just can’t bridle its algorithm in own favor. Don’t forget that Facebook plans to spend up to $1B on original content.
Arguing with John Battelle and his “Facebook Can’t Be Fixed” publication it it is worth noticing that Facebook can. More interesting that Mark Zuckerberg actually acts as described in second scenario.
Also you might be interested in opinions of Wolfgang Blau, Jeff Jarvis and Joe Edelman:
