Facebook: The Full Stack Internet Company
Facebook has 1.4 billion monthly active users, up by 58% since Q3 2013. Quite simply, Facebook is big and is getting bigger. But the metrics only tell part of the story.
Since its inception in 2004 as a networking tool for college kids, Facebook has gone on to become one of the true internet giants. Alongside Google, Apple and Amazon, Facebook is one of the big four Full Stack Internet Companies, combining multiple products, technologies and revenue streams in a bid to own as much of our digital lives as it possibly can.
Each of the big four has its own unique set of capabilities and way of doing things but all share the asset of operating an ecosystem within which they exercise control. Google took the federalist approach in order to push out its tentacles of power as far and wide as possible via technologies (e.g. Google Search), products (e.g. YouTube) and platforms (e.g. Android). Facebook instead focused on building a self contained state. While it has augmented reach by also pushing tentacles out into the wider web with technologies such as universal Facebook log in, everything is geared towards locking more of users’ lives into its platform (and gaining data in the process).
Facebook Has Already Both Lost And Won The Battle For The Next Generation Of Users
All of this is part of Facebook future proofing its existence, creating a sophisticated hierarchy of consumer and business lock-ins that make it harder than ever for users to churn out of the network. And when product innovations don’t work, Facebook buys solutions. Facebook knows that it has already lost the battle for the next generation of social networkers. It is a victim of its own success: because of its ubiquity among consumers in their 30s and upwards, kids and teens are hardly going to be attracted to Facebook in the same way the previous generation: virtually every single one of their parents, older relatives, teachers and employers are there! Thus Facebook has invested in the next generation of social networking: Messaging Platforms. And with Instagram, Facebook Messenger and WhatsApp it has also become the global leader in that slice of the social landscape.
Facebook is so much more than a social network. It has become part of the very fabric of the digital world.
Just got back from 2.5 weeks in India (5 cities) during the great dustup over Facebook’s Free Basics...spoke to people, read every newspaper, tweet, and article I could get my hands on...including Zuckerberg's tone-deaf response to the country over the importance of Free Basics and their intention to save a farmer named Ganesh from poverty, which btw, no one believes. The government has even halted Facebook's attempt to access over 600M people who are yet to get online. In fact it already looks as if Facebook is starting to focus a bit more on Africa which is more fragmented, considering they flubbed this one. Facebook clearly thought they could just drop right in with a magnanimous free offer, just like they have everywhere that people already have access, and they'd be able to add a quick billion people no problem. Not so fast... What I find fascinating about India is that it feels very 1994/96-ish to me when it comes to the web...nascent and exciting. It feels as if things are very new yet with lots of opportunity. But that also feels as if there is a sense that they have their own course to set, and that is one where privacy and data mining of people might not be as easy as it has been in the rest of the world. They've had an opportunity to see what happened in say V.2 and V.3 of the Internet, and aren't necessarily interested in repeating the experience. For them there is more to lose. That said, one thing was very clear about what occurred there and it is something that investors of Facebook might need to be wary of…and that is adding the next billion people to FB is going to be a lot harder than the first, and if the pushback we’re seeing in India and Egypt expands, Facebook’s growth might be severely curtailed, and Silicon Valley might just find itself with serious competition from other nations. One last point I’ll make is that I think this is an important step for India and other nations to take because when you look at 600M+ people who have never accessed the Internet before, you realize that these are people who have no understanding or may find it hard to conceptualize that information..personal information and data (invisible abstractions) have value. So beyond just the idea of Net Neutrality, you can’t just open up this gateway without educating a populace or building protections for them. I think India and others have an opportunity here to do some very right things that have gone very wrong. Facebook’s approach felt very much like British Colonialism, in that here were the white people of the west there to help the people of India and all they had to do is essentially give them…everything. In fact I even saw a Bloomberg video where two white people from Silicon Valley were debating the merits of Free Basics, and by debating I mean agreeing with Facebook and basically taking the position that India was being foolish to turn this down. And just like the past, people stood up and said…no. https://mashable.com/2015/12/28/aib-eic-facebook-free-basics/#LpzQEEaBrgqq It pays to get out, travel, and talk to people who don't live in Menlo Park.