Death to The Social Network?
Will Facebook’s Timeline soon say ‘dead’?
One US analyst seems to think so.
“In five to eight years they are going to disappear in the way that Yahoo has disappeared,” Eric Jackson, founder of Ironfire Capital told CNBC’s Squawk on the Street, this week.
Comparing Mark Zuckerberg’s Facebook, which recently went public to the (now) troubled giant Yahoo, Jackson predicts the network with 901 million friends will go the same way. (That’s a lot of deactivated accounts).
“Yahoo is still making money. It’s still profitable, still has 13,000 employees working for it. But it’s 10% of the value that it was at the height of 2000. For all intents and purposes, it’s disappeared.”
And what will cause the beloved Facebook to keel over?
Mobile, the analyst believes.
“Look at how Google has struggled moving into social, and I think Facebook is going to have the same kind of challenges moving into mobile,” he said.
He also reckons Facebook will have a hard time keeping up in the new ultra competitve generation.
But he’s forgetting one important thing: no social network – not even Google – has come close to Facebook prowess and astonishing number of ‘friends’ and it will take something truly amazing to lure almost one billion people away, without good reason.
Facebook already cited revenue warnings on the back of a dip in advertising in its IPO prospectus and considering its share price has already gone south – currently at around US$27 – down from $38 opening price, it is not oblivious to the hard road ahead as it reaches maturity.
Many analysts do believe mobile is the greatest challenge on Mark Zuckerberg’s to do list, considering over 450 m access the network via mobile.
But The Social Network is already going hard on mobile and released several new mobile apps including a dedicated ‘Camera’ for iPhone, Karma gift giving app and is also said to be developing a dedicated mobile, codenamed ‘Buffy’.
But this is not enough, Jackson insists.
“Facebook can buy a bunch of mobile companies, but they are still a big, fat website and that’s different from a mobile app.”
However, although it is clear Facebook’s own mobile app needs some work yet and is facing several other challenges, writing off the mighty network may be a bit premature.