Is Facebook Weaker Than What We Thought?

Do you remember how few days ago our WhatsApp & Instagram was not working, and we blamed Jio & Airtel for that? Amusing, right! But social media itself was the real offender.

This “Facebook Crisis” is due to a number of factors, including the server meltdown, unforeseen name change plans, and news of leaks. We have a very good reason to wonder what is going on with Facebook., as this social media behemoth has already been in the spotlight for all the wrong reasons.

So, let’s start our conversation as we look at all these issues and allegations, what changes it had brought, and how this affected us, the regular users.

Business Model

With a user base of 2.9 billion, which is more than one-fourth of the world’s population, the total revenue of Facebook, now known as Meta, in 2021 was roughly 117 billion dollars. With its users paying nothing to use its apps like Facebook, Instagram, WhatsApp, and Snapchat, a question arises, how exactly does Facebook earn money?

Actually, the company revenue stream is mainly divided into 2 segments i.e., Family of Apps (including Facebook, Messenger, Instagram, WhatsApp, and Snapchat) and Reality Labs (including the company’s augmented reality and virtual reality products and services). Nearly all the revenue comes from advertising (more than 95%) supported by over 10 million active advertisers on Facebook as of 2020.

Rise of the Social Media Behemoth

Facebook was not the first social networking site, but it still succeeded in becoming the largest. Its expansion was influenced by a number of factors, including the increasing accessibility of broadband connections and internet connectivity as well as avoiding the mistakes made by early social networking sites.

It not only followed the idea of controlled growth i.e., increasing its customer base in stages to avoid technical problems and build a reliable technology, but also kept on improving its platform by adding new features, copying them from competitors, or even buying them outright. Additionally, it introduced the idea of targeted advertising supported by user base data.

All this innovation led to fast and steady growth for Facebook. As we have always heard slow and steady wins the race, but Facebook took it a step further and won the race with fast and steady growth.

Reasons for the Fall

1.    Teen Depression: According to Instagram's own research, 32% of teenage female users in March 2020 said that the app made them feel worse about their bodies. The company's experts repeatedly found that Instagram is harmful to a significant portion of its users, to which Facebook’s response was lacklustre at best.

2.    Name Lawsuit: A 12-year-old start-up called META that creates immersive experiences filed a complaint in federal court against the organisation formerly known as Facebook for changing its name to Meta. According to the lawsuit, after changing its name, Facebook/Meta engaged in unfair competition in addition to infringing META's two legitimate trademarks.

3.    Data leaks: According to Forbes, Facebook is not known for its security or privacy, so the best course of action is to simply delete your account if you want to be as private and secure as possible.

4.    Losing Customer Base: Facebook's daily active users have decreased for the first time. The website had 1.93 billion daily active users as of Q3 2021. The amount decreased to 1.929 billion in Q4 2021. As a result of this user base loss, Meta’s market value decreased by a whopping $230 Billion.

Other concerns include the failure of Facebook's own cryptocurrency Libra and the possibility that Facebook would change its theme to resemble TikTok in what may be its final effort to remain relevant.

 Conclusion

All of this is not meant to imply that Facebook isn't influential, that it shouldn't be governed, or that its operations don't merit close examination. Facebook still ranks among the most significant businesses in history and has the power to influence politics and culture on a global scale, even though it is in decline

However, we shouldn't mistake a platform's desperate writhing for a display of strength or mistake defensiveness for healthy paranoia. Godzilla eventually died, and Facebook will too, as the Facebook Files demonstrate.

Tell us in the comment section your views on the same.

References:

1. https://cnb.cx/3zQ4Gj9
2. https://www.makeuseof.com/why-facebook-is-losing-users/
3. https://www.bbc.com/news/business-61250669
4. https://bit.ly/3ztudhS
5. https://bit.ly/3oRKwjk
6. https://cnb.cx/3BC2Rsj
7. https://on.wsj.com/3Sizz82
8. https://bit.ly/3zVCSel
9. https://bit.ly/3Q9q5dw
10. https://blog.finology.in/entrepreneurship/facebook-rebranding
11. https://www.nytimes.com/2021/10/04/technology/facebook-files.html