Many people suggest we're in a bubble, and usually call it a social media bubble. I still find myself wondering if we aren't in an <i>advertising</i> bubble instead, with social media a rider and not a driver per se of the trend. Advertising is and always shall be a very important part of the economy, but there's also this sharp bound on exactly how much money it can move around since it needs to result in net profit for the advertiser. Google definitely has demonstrated they have a superior platform. I'm not sure anybody else has. Not just Facebook, anybody else.<p>If there's any element of this bubble that reminds me of the previous it is that there are still an awful lot of startups out there who are trying to simply acquire as many users as possible with vague plans to figure out how to make money later... and they all seem to come up with the same, "Uh... shove ads at them, I guess?" plan in the end.
Everyone always seems to talk about Facebook for payments.<p>Am I the only one that finds this hard to believe? Why is Facebook in a good position to authorize payments? They have very few credit cards on file. Besides FarmVille, et al, who exactly is giving their credit card info to Facebook?<p>In what context am I supposed to use Facebook to pay for things? If we're talking about mobile, then we're talking about smartphones. What exactly makes you think Google/Apple are going to lay down and give the keys to the mobile payment castle to Facebook? Google and Apple already have our credit card info, we all already buy things through Apple and Google, and it is a logical step that I would use that same process for buying something with my smartphone in a store.<p>I don't think it is a logical step for me to pull out my smartphone, open my Facebook app and use it to pay for something, anymore than it makes sense to use my Twitter app to pay, or Instagram for that matter.<p>In fact, if we're going to use a third party app to pay for things, I have an app from my bank, why not use that?<p>I just don't see Facebook getting in to mobile payments...
(1) I don't think that digital ads are less effective than old TV and Newspaper advertising. In the bad old days, nobody could measure the impact of advertising and people assumed ads were worth more than they are.<p>Once it became possible to measure the effectiveness of transactional ads online, it became a lot harder to justify the cost of display ads.<p>The advertising apocalypse won't just affect the internet, it will affect traditional media. On the few cases where I watch cable or OTA TV I'm shocked that the ads are 5-10% relevant to me -- it seems like much of the industry is kept alive by ambulance-chasing lawyers, credit repair services and the medicare economy.<p>(2) Facebook has other ways to make money, and in a pinch, they'll develop them -- it's believable that they could increase revenue 2-3x in a year or two if they really had to... Largely because they haven't had intense pressure to increase revenue. Facebook Credits, for instance, could be a gold mine if you could buy more things with them.
The article proposes that the ad-supported web will collapse along with FB after prices have dropped to beyond unsustainable ... what would the post-ad web look like? I'm looking forward to all the content farms, endless plagiarism, and constant attention-seeking going away; what else will happen?
All of the theories on the death of Facebook are all based on the premise that Facebook won't pivot. That the only way out is to monetize mobile. If you asked me 10 years ago, I could've never predicted AWS or the Kindle, but look at Amazon today.
Facebook Connects the world...almost everybody i meet is there and i can write messages from my phone to them for free.
Add to that their giant app platform for games and entertainment stuff. Soon you will be able to Pay with Facebook Credits everywhere...i think they have plenty of ways to go apart from advertising.
Here are some opportunities:
Social graph is their biggest asset. 900million users.
A number of companies have been built only because of this network. I can easily see them charging large sites in the future.
Spotify, Pinterest, Tumblr are just a few companies using the social graph to build better products and all of them are billion dollar companies using Facebook for free.
Google maps now charges large sites for API calls, Bing is now charging for API calls. Facebook will too.<p>Payments is an amazing opportunity for them. One click, Purchase With Facebook. The payment processing game is all about the network effect. Dwolla is innovative but they need an "eBay" for them to gain massive usage. Facebook doesn't need it.<p>Facebook can destroy eBay by creating a marketplace + their own payment processor. Facebook is the only company that can break eBay's monopoly of the online marketplace and payments. This field is ripe for disruption and in the game of network effect Facebook is unstoppable.<p>I can see them moving into enterprise too. Maybe teaming up with Micosoft's Office 365 to create an awesome enterprise social network with Office 365 built in.<p>Online gambling laws are starting to become loose. This can be huge for not only zynga but for many, many other massive companies who would love to use the social graph for the gambling. Example: BetFair and Bwin.
Even if Facebook collapses, it doesn't mean it will take the rest of the web down with it. It just means that perhaps a place where you are shooting the breeze with your beer-drinking buddies isn't the best place to sell some, perhaps even most, goods and services. If that's the case, and the price for putting an ad on FB decreases, it doesn't following that the price for running an ad on another website will also be lower.<p>The author making the fundamental mistake of assuming that all web sites are the same, and that's obviously false. Just because Facebook is (in his view) a ad-supported website doesn't mean that it is interchangeable with any other ad-supported website.
It was a wrong move for Google to have gone into the social media business IMO. It took focus from their search, which has arguably lost quality, and injected search with too many diversions and "noise".<p>The level of interest in Google+ reflects "the fallacy of Facebook" as well, it is the same effect: why would people continue to expose themselves like that?<p>Social media with a purpose, like LinkedIn and similar, are good for business contacts. Facebook and Google+ simply aren't a business environment.<p>The purpose of Facebook and Google+ is to mine data and sell ads. IMO that is a broken business model, because at some point privacy will inevitably become a barrier.
If I can send a message to anyone I know or have met (in real-time, asychronously, or by video), who will receive it on their phone or computer immediately, without having to remember a number or address, I'd call that earth-changing.<p>I don't know if Facebook will be a successful business, or if more convenient ways of communicating will appear in the future, but the ability to let me easily communicate with all my friends and family is as earth-changing as I'm going to need it.
I wonder why no one mentions surveillance? Facebook may not be a perfect platform for advertising, but it is an awesome Big Br0 2.0. It's a lot more efficient and effective than anything that the N5A, C1A, or any other major intelligence agency have ever concocted directly. Like it or not, Facebook is here to stay. Whether it generates revenue from advertisers or governments is another story.<p>I strongly feel that C1SPA will be a strong part of Facebook's financial future.
This is why the Demand Media model (the massive production of content part) makes some sense.<p>Google wants publishers to make high quality content, but they don't understand that the ROI for that model is often piss poor, and very unfeasible for small, beginning publishers.
I think Facebook needs to get into the business of selling my data to companies I personally trust to have it.<p>Imagine letting me auction off my corner of the Facebook graph to companies that bid for it and I trust to sell it to. I get paid, Facebook gets a cut, and everybody is happy because I retain control over my data and the company who gets it knows they have a valuable, trusting customer and not just some apathetic eyeballs.<p>I don't think this is realistic at all, but it would be a way to calm privacy fears and revolutionize web advertising. As it is, most people I know just use adblock, because internet advertising is absolutely terrible. But -- and this is saying something from somebody like me who despises ads -- it doesn't have to be.
The earth-changing idea is that we are all connected electronically by a few degrees. A lot of companies have tried this but Facebook has come the furthest.
Facebook has so many options:
E.g. Imagine you could also sell goods and open a shop on facebook. No need to leave facebook anymore, or visit another website on the web.