Eight Industries Facebook Will Want To Swallow Whole

Last Updated May 10, 2010 3:09 PM EDT

Facebook has an audacious plan to become the center of the web. But I think the audacity has only begun. Look at the company's strengths and you can see a number of areas it will want to expand ... and a number of companies it will want out of the way.

To understand a business and its likely strategy direction, you look at its core reason for being. Harley Davidson helps customers create a motorcycle lifestyle; bike and branded clothing sales are mechanisms to the end. Nike sells the dream of being an athletic hero. Starbucks? A haven from both work and home.

Facebook promises community that is always in touch. Communications and trust are key driving factors for what the company can and likely will do. In the short or near term, that would translate into the following:
  • The ultimate portal -- Yahoo (YHOO) CEO Carol Bartz only wishes that she had the business model for growth that Facebook enjoys. Yahoo became big because it was a central place to find information and services. Facebook is big because it is the center of consumers' online lives in a way Bartz can only envy. The migration of consumers and advertisers will only continue.
  • Classified ads -- Make way, Craigslist. Facebook has an enormous number of regular users who go by their real names and have some degree of trust relationship with people they know. Facebook classifieds could let customers reach others in their areas, and the messaging capabilities already exist in the system.
  • Media sales -- Many people recommend music, videos, and books on Facebook, which could become a natural conduit for selling downloaded entertainment media. Like what someone pointed out? Click a link to get it to own. This will be tougher than most industries for Facebook to crack because it doesn't have the natural tie-in to devices that play music, so Amazon (AMZN) and Apple (AAPL) needn't worry -- yet. However, consider a relevant acquisition or partnership and Facebook could become a serious contender.
  • News aggregator -- Think Twitter is hot when it comes to transmitting news? A major activity on Facebook is sharing links to news reports, which makes it a potentially huge aggregator. What it has over automated systems like Google (GOOG) News is that it has de factor curators -- users -- who choose the material and then present it. Add automated feeds as well, and it could replace other outlets.
  • Job site -- Corporate recruiters are different from you and I. They're interesting in people who are potentially qualified for a job, whether they seek new positions or not. Given that Facebook can mine conversations and background to determine what most of its users do and what their areas of expertise might be, it could be a rich medium for companies that want to hire -- and customers who want to be hired.
  • Auctions -- This is similar to the classified concept, only broadened to incorporate people from different geographic locations. Look out eBay (EBAY), because people would know with whom they were dealing.
  • E-payments -- Facebook plans links with everyone and an internally-run payment system. If it wouldn't hurt eBay on auctions, it certainly would on this.
  • Email and IM -- Many people already use Facebook private messages and chat. Give the option to send messages within Facebook or externally to email, and making the jump from Yahoo or Google wouldn't be so difficult.
Not only would each of these areas offer opportunities for direct revenue and advertising, but they'd all do what Facebook likes most: spill even more detail that the info machine could vacuum up and use. And there are probably other areas that the company will address over time.

Vacuum image: stock.xchng user gokoroko, site standard licence.
  • Erik Sherman On Twitter» On Facebook»

    Erik Sherman is a widely published writer and editor who also does select ghosting and corporate work. The views expressed in this column belong to Sherman and do not represent the views of CBS Interactive. Follow him on Twitter at @ErikSherman or on Facebook.

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