The #1 reason Facebook won't ever change

["Dave Farber" <farber () gmail com>]

Begin forwarded message:

> From: Dewayne Hendricks <dewayne () warpspeed com>
> Date: March 25, 2018 at 7:54:04 AM EDT
> To: Multiple recipients of Dewayne-Net <dewayne-net () warpspeed com>
> Subject: [Dewayne-Net] The #1 reason Facebook won't ever change
> Reply-To: dewayne-net () warpspeed com
>
> The #1 reason Facebook won’t ever change
> By Om Malik
> Feb 20 2018
> <https://om.co/2018/02/20/the-1-reason-facebook-wont-ever-change/>
>
> Facebook’s (much deserved) media nightmare continued this week when it came under criticism for spamming members who 
> signed up for two-factor authentication. This was followed by charges that its Protect VPN software (based on its 
> Onava CDN) was essentially corporate spyware. The collective outrage over Facebook and its actions might result in a 
> lot of talk, but it won’t really change Facebook, its ethos, and its ethics. Let me explain!
>
> **
>
> A few years ago, I wrote that companies have a core genetic profile and it is tough for them to deviate from it. That 
> DNA defines every action, reaction, and a strategic move made by a company. The DNA represents a company’s ethos — 
> and to a large extent, its ethics. Microsoft was and will always be a desktop software company, albeit one that is 
> doing its best to adapt to the cloud and data-centric world. It has turned its desktop offerings into smart revenue 
> streams on the cloud.
>
> Google’s core DNA is search and engineering, though some would say engineering that is driven by the economics of 
> search, which makes it hard for the company to see the world through any other lens. Apple’s lens is that of product, 
> design, and experience. This allows it to make great phones and to put emphasis on privacy, but makes it hard for 
> them to build data-informed services.
>
> Facebook’s DNA is that of a social platform addicted to growth and engagement. At its very core, every policy, every 
> decision, every strategy is based on growth (at any cost) and engagement (at any cost). More growth and more 
> engagement means more data — which means the company can make more advertising dollars, which gives it a nosebleed 
> valuation on the stock market, which in turn allows it to remain competitive and stay ahead of its rivals.
>
> Just look at these charts and you start to see why Facebook is addicted to growth and engagement. Engagement gets 
> attention, and attention is a zero-sum game. Time spent on Facebook (or Messenger, Instagram, or WhatsApp) means 
> that’s attention not spent on Twitter, Snapchat, or anyone else who dares to compete with them.
>
> Facebook’s challenge is that their most lucrative market — the US and Canada — are saturated. And to keep making 
> money in these markets — already a ridiculous $27 in ARPU for the last three months of 2017 — they need us to give 
> more time and attention to them.
>
> In 2017 compared to 2016, the average price per ad increased by 29%, as compared with approximately 5% in 2016, and 
> the number of ads delivered increased by 15%, as compared with approximately 50% in 2016. (From Facebook’s 2017 10k 
> filing)
>
> This is a crisis situation for Facebook because it doesn’t make as much money from markets outside of the US and 
> Canada. For the same three months, it made $2.54 in ARPU in Asia-Pacific, $1.86 in rest of the world, and $8.86 in 
> Europe.
>
> The ARPU numbers, especially in the US and Canada, explain why the company is publicly talking about the challenges 
> of fake news and how it is trying to remove such news from users’ feeds — and instead refocusing on friends and their 
> stuff. It has to make polite noises around fake news (aka spam) in order to get people back into the fold and staying 
> on the site longer.
>
> I don’t think this change of heart on the part of Facebook and Mark Zuckerberg is not altruistic. However, it is 
> pretty evident that they are trying hard to get us back onto Facebook, and more often. At the same time, the company 
> is running a campaign to burnish its image and come across as a company under siege, as outlined in a recent Wired 
> cover story. But Facebook isn’t the victim — it never is, and it never will be!
>
> [snip]
>
> Dewayne-Net RSS Feed: http://dewaynenet.wordpress.com/feed/
> Twitter: https://twitter.com/wa8dzp



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