Facebook Agonistes: Advertisers, Adults, Developers Pulling Back; Banking On Global
This story was written by David Kaplan.
While it looked as if Facebook might have rebounded quickly from its Beacon debacle last fall, Fortune contends the revolution is steadily losing steam. The site grew 12-fold since opening its membership to non-students in September 2006, but growth has lately hit a wall, with unique visitors hovering between 30-35 million, according to comScore (NSDQ: SCOR) numbers. Then Fortune adds its own "anecdotal evidence" to suggest interest among the older users who were key to the social net's continued rise is starting to wane.
-- Developers' disappointment: Both Fortune and News.com point out that even developers are getting fed up with the Facebook Platform, which was opened to developers last May. Developer Jesse Farmer finds activity in the developer forum falling 27 percent over the past two months. Competition from Google (NSDQ: GOOG) OpenSocial and others are part of the reason, while News.com, keying off Farmer, says users tend to find apps like Zombie Wars more annoying than novel. But Facebook could be spurred to make modifications in the face of these challenges and turn the situation around, News.com posits.
-- Social net ad spend revised downward: A turnaround in advertising is not likely to be fixed so easily. Facebook took in $145 million in revenue last year, according to eMarketer. The researcher has just revised its social net ad spend forecast downward, with Facebook expected to attract $265 million in 2008, down 12.9 percent from the earlier forecast of $305 million. By comparison, eMarketer previously anticipated MySpace advertisers to spend $850 million in the U.S. this year, but that estimate has now dropped 11.2 percent to $755 million.
-- Looking abroad: As the U.S. market slows in the face of larger economic pressures, BusinessWeek finds Facebook following MySpace again, this time by shifting its concentration to other countries. Facebook is readying tools that translate the site into four additional languages: Dutch, Italian, Norwegian and Polish. Other languages, such as Chinese, will be rolled out over the next few months. Both Facebook and MySpace have said that international expansion is crucial to their respective growth. More than 60 percent of Facebook's 110 million global users are outside the U.S, while 30 percent of MySpace's 117 million members are registered in other countries.
By David Kaplan