For those that don’t know Facebook was founded by Mark Zuckerberg, Eduardo Savery, Dustin Moskovitz and Chris Hughes in 2004. The Facebook started being used for people to get know each other, initial limited to Harvard students quickly was opened to other colleges. Today Facebook is the most used social network worldwide with 400 million active users worldwide. Facebook makes money mainly from advertising revenues.
It’s quiet difficult for me to predict what will happen to Facebook in the next 2 or 3 years. Facebook is still increasing very fast but in this market anything can happen (like a new social network being launched with high sucess) and Facebook could stop growing or even disappear. Some people think that Facebook reached a dimension (everyboby now has most of their friends/contacts in Facebook) that would be difficult for people to switch to other social network. I agree but this is not enough. The first social network I used was HI5, by the time I about Facebook I had already a big list of contacts in HI5. I started Facebook but for some time HI5 was still my first social network. As soon as most of my contacts become available in Facebook, I stopped using HI5. What I mean with this is that being big is very important but is not enough.
I expect that in the next 2 or 3 years Facebook will improve the “live” interaction between users, for example instant messaging. The Facebook “Chat” is a bit boring if I compare it with other instant messaging tools. Since I believe most of the people contacts are in Facebook makes sense to increase the use of Facebook for instant messaging. It’s easier to expand the contacts in Facebook then in instant messaging tools, in Facebook you just need the people name (no email adress in needed). I believe (and expect) that Facebook will work on this in the next years.
Other possible trend is that Facebook starts to offer social networks for specific subjects, for example professional, environment,… I believe that Facebook has is big dimension as advantage.
Connectivity with other websites. Is clear that Facebook has been increasing this I believe that the trend is to continue.
Overall I strongly believe that Facebook will continue to be the major player in social networks market in the next 2/3 years … but everything is possible…
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Hi Afonso. Very good post. You have explained about facebook with a personal example. I foresee a video chat to be the next level of comfort for networking or friends to keep in touch. Be it facebook or any other networking site that simplifies this aspect may create new dimensions in the future.
ReplyDeleteBut observing the user friendliness that facebook has is definitely an indication of its dominant position over other networking sites like namesdatabase or hi5 that began earlier.
If facebook faces stiff competition from any new sites which take over a major part of advertising from facebook, Facebook might encounter trouble with its revenue. This is because a major chunk of revenue for Facebook is from advertising sponsors.
Would be greatful if you let me know your thoughts on the same.
Yash, thank you for your post. I couldn’t agree more with the points you mentioned.
ReplyDeleteFirst the friendliness and image of Facebook was in my opinion his major success to grow (especially if I compare with social networks existing before Facebook).
Video chat, I also think that sooner or later Facebook will offer this sooner or later. Other players in the market are already offering this functionality.
Around 90% of Facebook revenues come from advertisement. Any new strong competitor may cause the Facebook revenues to go down.
Hi Afonso,
ReplyDeleteGreat post you made. I head a web company where we develop websites and Facebook is clearly the best way to promote then in a viral way.
I guess that companies (specially small ones) must embrace Facebook to promote their products as not only is it free but you can also reach a really big audience!