Facebook Is Becoming The Old Man In The Room
This week, audio from private Facebook meetings with CEO Mark Zuckerberg was leaked, and it could show a company lagging behind.
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“It’s almost like the Explore Tab that we have on Instagram” is how Zuckerberg described social entertainment app ‘Tik Tok’, in one of the company’s leaked all-hands meetings.
The signs are worrying here for Facebook, as this description could not be more wrong. ‘TikTok’ offers a completely new form of social engagement unlike anything Facebook has produced before, and Facebook is failing to replicate it. Its copycat, ‘Lasso’ is completely underperforming, with just 425,000 downloads since November. TikTok has had 640 million downloads in the same time-period outside of China alone.
These stats and Zuckerberg’s comments make for worrying reading among Facebook’s investors, who have seen the company undergo its fair share of troubles and controversies over the past 5 years, such as the Cambridge Analytica scandal.
‘The Social Network’ has got another big problem, and it is the loss of its younger audience, as close to 25 million people under the age of 25 stopped using Facebook in 2018, with more following suit. TikTok meanwhile, along with other competitors such as Snap Inc. are seeing their younger audience multiply each quarter.
Can’t Facebook Just Buy TikTok?
Facebook’s stock price dropped almost 2% following the leak of the company’s meetings, which displayed a clear lack of understanding on Zuckerberg’s behalf. How can Facebook combat a rival that it doesn’t understand? In the past, Facebook would simply buy its rivals, Instagram and Whatsapp, to name a few. Nowadays however, this may not be so simple considering Zuckerberg has antitrust breathing down his neck, and the U.S.-China trade war is putting pressure on U.S. tech firms.
TikTok’s parent company, China based ByteDance is a privately traded company, but has eyes on an IPO, with its latest estimated value coming in at $75 billion.