Researcher from Princeton predicted that Facebook will be abandoned by 80% of its users by 2017 following the models of infectious diseases. Time might proof this to become true, but with the introduction of Paper1 Facebook revealed a shift in their strategy, that I think will make them immune.
For years Facebook has been mainly treated as a website by its founder. What you see when you type its address in the browser is the product. The first versions of its app were just this website shrinked on to a smaller screen. The reason for Facebook predecessors – friendster, myspace – to fail in the long term2 was that once users are accustomed to a design, major changes are impossible without drawing a lot of anger. By developing different designs for different customer segments Facebook can innovate and satisfy customers who are willing to adapt and those wo don’t at the same time. With a user base of 1.23 billion people3 the maintenance of an older version that is used by only 30% of its users is reasonable and manageable. The product Facebook now is what is running in the backend – the pure social graph.
The acquisition of WhatsApp emphasizes its ambition to own and control social. The fact that brand, design and business model won’t change (for now) shows that Facebook can appear quite differently. Consequently Facebook is rumored to be woking on separate apps – additionally to its messaging and photo taking app – such as a Calendar app.
Paper has been developed in Facebook’s Creative Labs. Josh Constine wrote on Techcrunch:
It’s an initiative that gives small teams the freedom to form within the company and build standalone apps or other projects that live outside the core Facebook experience. It’s not a physical space or formal reorganization of the company, but a way to explore new forms of social connection. […] One more huge benefit of building apps through Creative Labs instead of Facebook proper? They don’t have to monetize. Just like startups, Creative Labs apps can concentrate on building something people love that grows to be big before worrying about making money.
Another thought from the same article:
Perhaps Facebook Creative Labs could build a Facebook Arcade app that offers a rotating curated set of games from third-party developers, capitalizing on how the app stores are crowded with crap.
Interestingly that is what LINE messenger is doing already: Curating gaming apps and retain a certain percentage from in-app purchases. Surprisingly this accounts for a big portion of their revenue.
This new strategy enables new ways of commercialization and keeps the company fresh and flexible – probably for more than three years to come.