Many years ago, Facebook went through the roof. Mark Zuckerberg had the right idea at the right time and became very rich because of it - deservedly so. But the world keeps turning, and Facebook became increasingly unpopular. At least the subsequent generations didn’t want to be on the old folks’ platform.
As a company, I now have two options: I can evolve from within, or I can look at what other companies are doing. Facebook chose the second strategy and has been on a major shopping spree over the years: WhatsApp, Instagram, Oculus, and probably a few other companies. Internally, however, not much has happened.
With Facebook, a product was developed that improved upon existing alternatives, thereby becoming a pioneer. I have the feeling that after that, they ran out of ideas. On the contrary, they just reacted. WhatsApp was already widespread and successful when it was bought. In doing so, they practically discontinued Facebook’s own messenger. It still exists, but people are sticking with WhatsApp. For antitrust reasons, WhatsApp is not allowed to be integrated with Facebook - which was probably the actual, sensible idea.
Instagram was also already successful, and actually not that different from Facebook. Sure, the focus is on photos (Stories came later), but Facebook could do that too. It was, however, an alternative to Facebook for the younger crowd. But even here, after years, I see no integration of the products. Instagram remains on its own, apart from the optional login with a Facebook account.
Oculus was supposed to take a different path. The VR pioneer was acquired and immediately tied to a Facebook account. Okay, another combination with Facebook doesn’t exist yet. But the Metaverse is, or was, Mark Zuckerberg’s grand vision. Facebook in virtual reality, so to speak. Sounds exciting. What has been shown so far has caused a chuckle at best. Very simple graphics and, so far, more of a very rudimentary demo. A long way from a real product for the public, in any case.
In summary: Facebook has been chasing trends for years. But none of them have really advanced the company or its former main product. Even the restructuring into Meta, and thus the demotion of the main product Facebook, seems to have been copied from Alphabet, aka Google. For Alphabet, it’s clear that their main product is search, or rather the associated advertising network AdSense (now Ads). Finding content on the internet and marketing it, that’s what everything is geared towards.
But Facebook’s direction is not clear to me. Facebook is dying of old age. Instagram is also getting older; the next generation is already flocking to other platforms, like TikTok. And WhatsApp? Still the most popular messenger worldwide to this day, albeit not without criticism. But it’s completely free, ad-free, and (supposedly) encrypted. With it, Meta generates no direct revenue or indirect revenue through user data.
The Meta advertising network has significantly less reach than Alphabet’s and also significantly less user data. Ads and Analytics generate detailed user profiles across the entire internet. The Facebook button has either disappeared or is integrated without data transfer. So Facebook knows what the user consciously wants to publish, but not what they do in private.
So what is the long-term plan for Meta? VR has so far racked up over $24 billion in losses, with 20 million VR headsets sold. That’s a loss of $1,200 per device. Sure, Metaverse development is the biggest cost driver, whatever. With that budget, you could develop 20 AAA games. This is also becoming clear to the shareholders, and criticism of Mark Zuckerberg is growing.
And just today, I read that Meta now wants to develop its own AI. Not an acquisition. VR will probably be scaled down for it. Another trend that Meta is chasing. Very late, again. And it’s not clear to me how AI fits into the company. Neither WhatsApp, nor Facebook, nor Instagram, nor VR needs an AI. Which product is supposed to be enhanced by AI? Or is the AI supposed to become a standalone product? For what purpose?
The company’s previous flops were more logical. Do you remember the AR glasses, their own Android launcher, the Facebook Phone, or their own smartwatch? All flopped or were terminated too early. But I could understand the ideas and, with a little patience, I would have even believed the products could have had some success.
But either Meta buys successful products whose purchase price is hardly recouped, or they start one project after another without seeing them through to the end. In doing so, they have no “product,” meaning no clear direction. Meanwhile, the competition is coming from all over the world and often already belongs to more powerful corporations.
I just don’t understand Meta’s course. Or does Meta actually have no course at all and is about to be left behind?