Like Once, Friend Anywhere

Two good pieces on Facebook today.

First, this piece from Reuters on the challenge mobile messaging apps present to Facebook:

Create personal profiles. Build networks of friends. Share photos, videos and music. That might sound precisely like Facebook, but hundreds of millions of tech-savvy young people have instead turned to a wave of smartphone-based messaging apps that are now sweeping across North America, Asia and Europe.

The hot apps include Kik and Whatsapp, both products of North American startups, as well as Kakao Inc’s KakaoTalk, NHN Corp’s LINE and Tencent Holdings Ltd’s WeChat, which have blossomed in Asian markets…

Firms that can take over the messaging world should be able to make some big inroads, investors say. “True interactions are conversational in nature,” says Rich Miner, a partner at Google Ventures who invested in San Francisco-based MessageMe, a new entrant in the messaging market. “More people text and make phone calls than get on to social networks. If one company dominates the replacement of that traffic, then by definition that’s very big.”

Major problem number one: Facebook, from business model to UX to platform, was built for the desktop. Apps like LINE were built for mobile, giving them an inherent advantage. I wrote extensively about this last Friday.

Second piece is from Benedict Evans:

The primary threat posed by all of these apps is unbundling. Instagram took photos and Whatsapp and others take messaging: both are just an icon on the home screen next to Facebook, and it seems much more fluid to switch between apps than to go to a whole other website…

This is, of course, exactly the same problem that everyone points out for Google: apps erode web search. Google is trying to address that by moving beyond web search with things like Google Now, which is just one manifestation of a deeper reorientation of how it looks at search (indeed, some of those pieces of content might well appear in Google Now). But apps may actually be just as big a problem for Facebook, both because they enable competitors, and because they might erode the actual use cases that make Facebook money.

So that’s major problem number two: While Facebook may deliver a more integrated experience on the desktop, on mobile there are many more “channels” (apps) and a remarkably efficient discovery and distribution method for those channels (app stores). Customers are much more likely and capable of selecting an a la carte app experience.

(As an aside, it’s striking how resistant customers are to most all-in-one solutions. How many tech companies have pushed all-in-one solutions that fit their narrow ideal of efficiency, only to be blithely dismissed by consumers more than happy with their “inefficient” methods that actually fit their context? You know, like this. But I digress.)

Three more problems come to mind when considering Facebook and mobile:

Major problem number three: The underlying architecure of PCs generally and browsers specifically was developed long before security became a major concerns. While this has been a boon to bad actors, it’s been just as much of a boon to advertising-based companies like Facebook (and Google). Once you log in to Facebook, you are effectively being tracked all across the Internet thanks to those ubiquitous “Like” buttons. The liking is an incentive for sites to plant tracking code on Facebook’s behalf. Frosting on the cake if you will.

On smartphones, however, apps are sandboxed; cookies registered in one app aren’t shared with other apps. This is infinitely more secure — and infinitely more damaging to Facebook’s ad business.1 Of course, the best way out of this box is simply to own the whole platform (Hi Android!).

Major problem number four: If we accept the thesis that messaging is the foundation of social on phones, and that messaging is inherently personal, then that means Facebook has a pretty significant brand perception problem. Their definition of social is public broadcasting, a definition they have reaffirmed both through word and deed. Users have learned that nothing on Facebook is personal or private; why would they expect to use Facebook for messaging? It’s not just that other apps are better at messaging; it’s that Facebook’s carefully cultivated value proposition is in direct opposition to messaging.

Major problem number five: The proliferation of messaging networks, on top of phone numbers, Facebook contacts, email addresses, and more, is seriously testing the assumption that the network effect is all that matters. A central piece of Facebook’s value is the fact that everyone else uses it as well, and to rebuild your connections on another network would be exceedingly difficult.

And, to be fair, to rebuild a network of ~500 people (the number of friends I have on Facebook) would be exceedingly difficult. But this is a case where the theorists have made the same mistake as those product guys building all-in-one solutions: we’ve ignored context.

The truth is that there just aren’t that many people I want to communicate with on my phone. Anything done on my phone is contextual to time and place, and high school classmates hardly make the cut. No, I don’t have my Facebook network in my messaging app, but I don’t really care.

That’s a problem.

  1. Ad networks have had to come up with all kinds of nefarious ways to track users, but those efforts are only usable in apps that have ads