- Facebook Does Not Produce any Content
- Facebook May be Maxed Out!
- Facebook Lacks Innovation
- Facebook Does Not Replace a Conversation!
Facebook DOES NOT Produce Any Content!
We have been told time and time again, “Content is King”. As an avid digital user, I have found this to be absolutely true. You may be hard pressed to find many who disagree. If this holds true, then Facebook is the biggest flakey investment you can make, in fact, it shouldn’t even survive much longer.
Facebook capitalized on technology – it was a place for people to come to connect and learn. This was at a time when content was still struggling to make its way to digital avenues. In fact, iTunes was in its infancy and did not even hit the top spot until 2008. This gave Facebook the edge as The Place to interact and learn. Think about content producers like the NY Times, they too, were late to the digital era.
What is Facebook and how does it generate revenue?
Users that create content! Every time you participate in Facebook you give them content. This was a fair tradeoff in 2008, perhaps even in 2011, but times are changing. If 2012 is the year of content, then Facebook may be in trouble. While there is likely not going to be a wild withdraw from Facebook at this moment, trust me when I say content providers are starting to see the value in limiting their content and perhaps even withdrawing future content from social sites like Facebook.
If the NY Times stops posting on Facebook, the NY Times will still have increases in readers and perhaps an increase in viewers. It’s arguable about whether or not the NY Times has made a terrible error in posting anything to Facebook. If I know that I count on the NY Times for my “content” but also know that I have the NY Times in my Newsfeed on Facebook, than I am much less likely to visit the NY Times app, website or open the email because I am counting on seeing the NY Times content on my stream. In fact, I even get a small preview that will likely let me know what the “content” is about and so there is no reason to visit the NYTimes.com or their app on my iPad. This is arguably a terrible business model for the NY Times!
The same can be said about entertainment – TV shows, Movies and Artists (i.e. musicians) that get little or nothing for producing “content” for Facebook. Why should Britney Spears keep placing “content” on Facebook? It’s not like Britney Spears needs 910 Million people to be introduced to her, does she? In fact even if only half of her “likes” turned into paid subscriptions at $1, she would have a entirely new revenue stream just based on the “content” already being produced.
Facebook May be Maxed Out!
We all know there is a peak in every business and venture but at 900 million how much further can you really grow? In fact, by recent number indications, Facebook may already be slowing down. Getting 900 million to pay attention to you is one thing, getting them to stay is another. As a Facebook user I admit I already spend a massive amount of time on Twitter and LinkedIn in comparison to Facebook. When Pinterest came out I gave up more of my Facebook time, not the other two!
Why are other Social Sites stronger then Facebook? They have a niche! Facebook has tried to be all things to all users and that’s gotten them lost! LinkedIn is where we go to do business and professional networking, Twitter is the top choice for news and chatting – after all you’ve never heard of a FacebookUp have you? Ever attended a virtual conversation on Facebook? In fact, Facebook completely dropped the ball when GooglePlus captured the world’s attention with Hangout! When you try to be everything to everybody you end up being no use to anyone, that’s Facebook’s grim future right now.
Note: Google may be the exception (Search and Social Come Together)
Facebook Lacks innovation
Let’s face it, when you fail to innovate you tend to open the door and show yourself out, Facebook showed early signs of that when Twitter was released. That was arguably the start of Facebook’s Why didn’t we think of that? Well lets copy it or better yet buy it!
The list goes on and on, Facebook got its status updates from Twitters innovation, Facebook Places developed from FourSquare and GoWalla, which was such a failure that later they bought GoWalla. Google Plus quickly trumped them with Video Chat and so Facebook tried to copy it. Once Facebook realized that Google was way too big and they could never compete with the inbound marketing of the search Giant, we then had a short lived Bing/Facebook Social Search integration. You love Google Video Ads, well Facebook copied that too. Fan of being able to Pin It! so is Facebook. If you really love the fact that a picture is worth a thousand words, then that’s the equivalent of a billion dollars as that’s what Instagram was acquired for, by Facebook!
We could talk about the business model, but after all the news about retailers flocking to Facebook pages and then running away clearly it’s not a primary place for business, no matter how many times they try to tell you it is.
Facebook is clearly over extended and in complete chaos with its inability to innovate beyond its checkbook. This doesn’t mean that it doesn’t have value in marketing and advertising, after all 900 million emails is a safe list, just one that might not be quite as valuable as we have been lead to believe.
Facebook Does Not Replace a Conversation!
It is possible that in the near future society will hinder Facebook forever, a status update is not a conversation. Networking, Learning and Communications are greatly hindered by the existence of Facebook and its just a matter of time before our nation and communities around the globe shun Facebook as a major contributor to health issues and conflict. Facebook has little if any reality in it, it is a place for people to share what they choose, trying to showcase themselves, their family and their lives in the best light possible even if it is the furthest thing from the truth.
One might enjoy the idea that grandparents can see their grandchildren through the curation of an edited and extremely biased feed, the truth however could range from basic struggles to life threatening abuse that fails to get discovered from a lack of real world contact.
If you’re a friend, family member or loved one, I hope you don’t mistake the value of real life contact with the purpose of a feed. I most especially hope it’s not at the cost of a future or a life.
The Balanced Truth
While I spent most of the time looking at a few of the issues that will impact Facebook’s survival, I don’t want to be unfair. Facebook is a great tool, but it’s just that, a tool! Facebook has connected people like never before, contributed to the free dissemination of information and pioneered Social Media into the revolution of digital communications. However, it’s just software.
Facebook cannot replace real life communications or the desperate need we have for them as part of our existence. No child will be born because of Facebook, no war will be stopped, no product will be manufactured by it, and no business will grow simply because they were on Facebook.
Children come from physical contact, wars are averted through communication that requires we hear, see, touch and smell each other. Facebook is not going to get on the assembly line and build your Ford, stove or Mobile Phone. Facebook will not report the news, and ask the tough questions. Facebook will not repair your roof or rescue you during an emergency. Facebook will not raise a child, nurture them, inspire them and provide for them. No business will be successful because they got on Facebook, that’s up to the entrepreneur, their vision, passion and hard work.
I am taken in awe by Facebook’s Innovation to come to existence and serve a purpose, it has changed lives, some for better some for worse. Facebook has value and can be used as an effective tool, just not one that a reasonably educated and experienced person can see growing much further. Facebook has been a consumer of great ideas and innovative content, but that’s the problem, it consumes, it doesn’t create.
Author:
@BasilPuglisi is the Executive Director and Publisher for Digital Brand Marketing Education (dbmei.com). Basil C. Puglisi is also the President of Puglisi Consulting Group, Inc. A Digital Brand Marketing Consultancy that manages professional and personal branding for Fortune 500 CEOs, Hedge Fund Managers and Small Business Owners.
Sources:
- Facebook: Why is Nobody Listening?
- Facebook Not Getting Into Content Creation
- Almost No One is Seeing Your Content on Facebook
- Is Facebook dying? What the Statistics Say
- So is Facebook dying or isn’t it? IPO investors need answers!
- Is Facebook Dying? A Prologue
- Is Social Rank Dying Already?
- Facebook Dying But Not Dead Yet
- Google+ vs. Facebook: See How They Compare
- Here is why Facebook bought Instagram
- Conversation is the New Connection
***Disclaimer, The article is meant to share the opinion of the author based on availble informations and data, it is not an investment tool.***
I must admit I was a bit shocked when I first read this and followed the sources to find them supporting all of the information here. A bit shocking, but I am still a bit on the fence here. Will investigate more when I have more time!
The Wall Street Journal just ran an article after I published this, very similar points but some interesting data too!
Here Are 10 Reasons Not to Buy Facebook Before You Buy It Anyway
http://online.wsj.com/article/SB10001424052702303879604577408724178786822.html?fbresult=add
Very interesting rant on Facebook and some controversial claims. I found it interesting that one of the biggest advertisers anywhere, GM, pulled all their ads from Facebook. When that revenue engine drys up, where is the money coming from?
Jeff Ogden, host of Marketing Made Simple TV
Jeff,
You might want to check on the Forbes article, they went straight with the title
WARNING: Stay away from the Facebook IPO
http://www.forbes.com/sites/markevans/2012/05/16/warning-stay-away-from-the-facebook-ipo/
Great points raised. I’d add Facebook ad performance as a 5th.
Sandor,
I was going to touch on that, but there is a silver lining to the Ad performance, you see the Facebook Ads are passive, so I can’t compare them to something like Adwords. In fact I often argue that Facebook ads are a higher quality CPC and so they do not have to perform as well as something like AdWords. However, you are correct bottom line is they don’t produce the volume that most require to introduce a product or service.
Basil
It’s also showing the problem with Wall Street that stocks are priced with no real regard to what the company produces. It’s all speculative.
Great post – I am an investment contrarion – if the majority like something they are usually wrong over time (see Enron, tulip bulbs, etc,). Also, as far as I can tell none of the money being raised is going to the Facebook company – it is going to existing shareholders. I hope that I can find people to buy me out of a portion of my business so the majority of my net worth is no longer all in one “basket”.
very good read, I wonder how long will facebook be around myself.
Reblogged this on emmageraln.
I remember all to well the Palm IPO, their still around but the IPO was just one big let down. I was fortunate enough not to buy any, but that was not for want of trying. Got a bad feeling about this one.
Basil:
First, thank you for your views on the Facebook IPO. It’s true, they don’t create content. We do. It’s also true that they don’t replace a conversation.
BUT. Our ability to reach out to people across the globe and begin friendships is priceless. Our ability to “touch” people we don’t normally have access to is incredibly important. No longer do we have to look next door for companionship. We only need to look to our news feed to find people that feel as we do, believe as we do. We only need to look as far as our computers to find people with similar interests. The first time I met Louise DiCarlo (@lovelylu) we hugged. We have things in common and began our friendship on Twitter. Without this “tool”, that may never have happened.
As for businesses, Facebook is another tool in the marketing toolkit. But, it is one that can’t be ignored. After all, where else can you obtain such detailed demographics and reach exactly the target market you are looking for? That just can’t be done with print or direct mail. There is nothing like Facebook’s wealth of information, all freely given. It’s the price of admission. And, it certainly works. When you are a small business with a limited budget, you can brand yourself to your specific market with very little cost. Try and do that with a local newspaper.
And, you are correct, Facebook is just a tool. But so is the telephone. Does that mean it won’t be here because it doesn’t create content? No. It’s just a tool. What’s more important, is how we use that tool. And 900 million people are using it for conversation, information, and relationships!
Craig
There is an issue with your analogy. The phone is a type of communication tool and it is still around that is true, both the hardware and software has changed drastically in fact the once monster phone companies are where? Your phone calls still happen but the companies, software and hardware are different. Social Media is here to stay, its Facebook as a software is likely not. I completly respect its place and value, it changed how we reach each others but it is no longer alone in its concepts.
Reblogged this on Ransae's Blog.
Well, I sure had to wait on line for this one. That’s why I never got to first movies or regular gynecologists (they keep you waiting for hours, in nothing but a skimpy robe) humiliating.
Anyway, I can not say that I completely do or don’t agree with you, Basil. I will say you sure stirred the pot with this one and than in itself is a plus for a blogger.
Here’s my take. I love facebook. I have created dozens of pages that showcase each of my entrepreneurial ventures, as a whole and in sub-division. It has more detail than my site. I have to find a way to transfer all this to my site (God forbid, you know what).
Then we have another virtual wonder Pinterest. I have started creating a synergy between facebook and Pinterest. Facebook pages to be related to Pinterest Boards. I love it. It is the greatest comeback for a graphic designer since the advent of Apple.
Granted the IPO made no sense to me. All I could see was greed. Since I am not a fan of the ‘Street’ anyway, to me, no good can come of greed and the kind of speculation involved in the whole thing.
But monetizing facebook and GM pulling out, those are the economics of the situation that are not my concern personally. Mark Zuckerberg got very wealthy already somehow. How? Who monetized facebook? The little folks like us? entrepreneurs? small biz owners? Milk money can add up.
So what else can I say other than to repeat:
• I love facebook. I can be found there more hours than anything else I do except sleep and I am not even sure about that any more.
• I love the new timelines for business facebook pages, great design opps for my biz.
* I hate the IPO. And if facebook is on the verge of failure because GM reaccessed their marketing budget not in facebook’s favor, then let the Government bail out facebook just like they did GM!