Of all the Big Tech giants, Facebook is the most vulnerable. Amazon and Google have built powerful monopolies. Apple’s branded overpriced hardware still has a lock on the hearts and minds of people with limited experience and liking for computer technology. Netflix has thrown so many billions at content creation that no one can compete.
Facebook however was a stroke of luck, a social networking site that became a platform and gobbled up enough apps to become dominant in its space. But the only ‘lock’ Facebook has on its users is their social network. And there’s not all that much keeping people from leaving.
Mark Zuckerberg has played a weak hand as well as he could, but Facebook is ultimately doomed and he knows it.
Meta was a too obvious distraction from Facebook’s user growth and political problems. It was bound to impress and upset the sorts of people who would never use it. When Zuckerberg first dived into virtual reality taking over Oculus, the results were moderately succesful. Facebook helped kickstart a very limited VR trend (some 8 million devices have been sold last year, which sounds like a lot, but is basically a drop in the ocean.) Meta was even sillier. It was Second Life (which is still around) made even dumber with VR headsets.
One day the metaverse may arrive, but it isn’t arriving now. The technology isn’t ready and may never be.
What Meta was, was a distraction from the real story.
Facebook’s active user numbers have dropped for the first time. There’s still a huge user base, but the Big Tech giants live off growth. A company that isn’t growing turns its entire pyramid scheme upside down. Suddenly the expectation that throwing more money at it will lead to more growth and eventually a death grip on the planet reverses. Don’t rush to sell Facebook stock just yet, but this is what keeps Mark up at night. Perception of growth is the ATM here. Meta is an attempt to distract everyone from this.
And Zuckerberg doesn’t have much of a plan.
At a company-wide virtual meeting, Zuckerberg explained that the historic stock drop was a result of Meta’s weak forecast for revenue in the current quarter, according to a person who attended and was not authorized to speak about it. It is important to focus on growing Facebook’s short-video product, he said.
Zuckerberg echoed his remarks of a day earlier to investors, telling employees that the social networking giant faced an “unprecedented level of competition,” with the rise of TikTok, the rival viral-video platform. Meta’s Instagram app has a copycat of TikTok called Reels, which the company is now prioritizing.
Employees were glued to the stock price. Facebook lost a record $251 billion of value in a single day.
Facebook survived this long by absorbing, ripping off or outlasting new social media upstarts. It’s not just TikTok that has Zuck worried. Nor will Reels help.
Changing the name is an attempt at outrunning failure, but that’s not possible.
Social networking is doomed to be disrupted in ways that the other Big Tech monopolies are much less worried about. Zuckerberg has no big vision for the future. Meta isn’t visionary, it’s a lame attempt to fake it.
All Facebook has is scale and that’s not enough. History is littered with dead companies that had scale.