The Impact of Facebook's Platform
It has been just under 2 months since Facebook launched their platform initiative, but this self-opening move has already had an extremely positive impact on the company. The changes are not limited to the company itself, however. The move has also disrupted the Internet industry as a whole and web 2.0 today looks very different than it did just 2 months ago. Let's take a look at what has changed since the launch of Facebook's Platform.
Facebook, the next big thing
They say "great entrepreneurs are great story-tellers." And that is exactly what flashed in the minds of journalists and developers who attended the launch announcement of the F8 Platform when 23-year-old Mark Zuckerberg appeared on stage. His youth and excitement had many people saying that Zuckerberg was channeling a young Steve Jobs. Today, because of the reasons we've discussed in the Pivots of the Internet article and all the acquisition offers that Facebook has consistently denied, Facebook is widely expected to take on Google as "the next big thing." Though their numbers are still far below MySpace and they have not garnered the traditional media attention that MySpace has, their growth rate is impressive and their vision is very promising. The Facebook Platform reminds many of us of Windows; and people are calling it "the social operating system" on which you can develop your Internet apps.
Mark Zuckerberg's F8 introduction speech:
Now flashback 25 years, here is Steve Jobs:
Facebook VC Funds
Perhaps the biggest sign of the Facebook Platform's economic value is the interest of angel investors and venture capital funds in applications developed specifically for Facebook. The biggest announcement so far has come from Bay Partners; a Cupertino-based VC that firm announced that it will invest seed-stage money into promising Facebook app ideas via their new AppFactory program (see our previous coverage). That such a well established VC company will focus so exclusively on Facebook is likely very good news for Facebook.
Google has announced a similar program called Google Gadget Ventures for its own platform, iGoogle. But Google's platform hasn't been able to create the same buzz as the Facebook Platform, and while Google is using internal funds to attract external developers, Facebook funding has formed organically, separate from the company.
New Opportunities
As a consequence of the two previous impacts, a new cottage industry has blossomed around the Facebook Platform. It has become the ubiquitous way of reaching mass users in a short period of time. The friction-free and viral nature of Facebook apps has caused some web innovators to shift their attention to developing for Facebook.
Many startups have changed their business plans to focus on utilizing the Facebook platform to spread their applications among the social network's 30 million users. Facebook app awareness has become a specialty that recruiters often look for in resumes. Some companies have even made small-scale acquisitions, apparently with the main purpose of acquiring talented Facebook developers (see SideStep's purchase of Extended Info).
Today an interesting competition has emerged between two already successful online slideshow companies; as Josh Catone stated in a previous article, the rivals have extended their fight to the Facebook Platform too and are battling for the broadest reach. These companies have made acquisitions in order to broaden their Facebook reach, see Slide's acquisition of Favorite Peeps, for instance.
Deprecated Strategies
With the introduction of the Facebook Platform, many Facebook/MySpace killer ideas have died. Hopes to take on social networking giants with more features have become nonsense; in other words, feature companies became obsolete. Even the strongest verticals, local social networks, have been affected by the move to open up Facebook to outside developers. As a result, many of these companies have been forced to change their strategy to stay afloat.
Perhaps the boldest strategy change so far has come from Ziki. The successful meta social networking site seems to have shifted its focus to people search, rather than simply social networking. Because the meta functionality was nothing but a feature on top of traditional social networking it was bound to be better as a Facebook app than as a full company. After all, in social networking, the most important parameter is critical mass (number of people that use your platform) and not the features you have. With the Facebook Platform, anyone can add meta features to Facebook, which is where the people already are.
Ziki's evolution from social network to people search.
Conclusion
In my opinion, these latest developments are enough to demonstrate why Facebook has already gained the reputation as "the next big thing" for many of us. It's very interesting that a private company, with revenues far less than the Google, can attract such mass attention from the media, users, VCs and an entire industry. I can only explain it with love: we all love Facebook's services, their culture and their decision to open their API. We hope that they can breathe fresh air into the industry. The only thing that bothers me is Facebook's so-called "dirty history" (the lawsuit against Zuckerberg from a Harvard classmate that contends he stole the original Facebooks source code). Hopefully, they'll resolve that problem and march on toward an IPO.
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Are you kidding, dude? Mark Zuckerberg is no Steve Jobs. Look at the two videos. Watch them. Listen to their voices. Mark is nervous and has little presence, he comes off as immature and unsure of himself. By contrast, Steve Jobs is like a rock star. There is a reason that Steve is a hero to hundreds of thousands of techies while they think little of Zuckerberg.
Also - Steve built a real computer company, left, built other substantial business, then returned to Apple to create the iPod and the iPhone. Mark ripped some php software from others at Harvard and caught the wave at the right time.
Posted by: Matt | July 19, 2007 1:53 PM
Also, I think the move to an open platform will ultimately make it easier for others to compete with Facebook. I think I posted this comment on RWW last week.
Open platforms mean application developers will be able to deploy apps to any social network. So essentially the social networks don't have any value from the applications offered - because any other social network can offer literally the exact same applications. The only value they have is in the # of people connected on the network. They may even start to look the same, as people add applications to and customize their profiles. What really separates a Facebook profile with 5 applications from a MySpace profile with 5 applications? Header, footer, color scheme... in other words, not much.
Millions of connected users creates a lot of value for Facebook and this is why we see buyout offers made to them for billions of dollars. But look how easy it was for tagged to pick up millions of users in a few months, with a clever spam trick. If I were somebody like Yahoo, I would be much more confident that I could build a social network to compete with Facebook now, than I would have been a few months ago.
Posted by: matt | July 19, 2007 2:01 PM
Emre and Matt,
The biggest thing that separets facebook from myspace is that businesspeople are starting to use facebook, while they are not starting to use myspace.
I can't imagine linking from LinkedIn to my myspace profile, but I do link to my facebook profile.
And the conversations with others in social media range from blogs to email to facebook... myspace is not included in the conversation.
Posted by: Brian Keith | July 19, 2007 2:36 PM
@Matt, if you read the whole article and not just look at videos and the titles, you'll see that there's no statement such as Mark Zuckerberg is Steve Jobs. But it's a fact that he shows up on stage and present such a big thing - a billion dollar thing - as the CEO of the company reminds many (me and many of people whom I've talked to) Steve Jobs, Bill Gates and others who become so successful so young. Maybe he won't, this probability still exists but that was what we saw on the scene, and what we remembered.
>Mark ripped some php software from others at Harvard and
>caught the wave at the right time.
We can't accuse him yet, but to be honest, I feel very uncomfortable with that too. If he becomes billionaire somehow, this doesn't mean he's smarter or dumber than the people we've talked or even ourselves. Being in the right place at right time is the key in usual.
Posted by: Emre Sokullu | July 19, 2007 2:52 PM
>And the conversations with others in social media range from blogs to email to facebook... myspace is not included in the conversation.
I keep seeing versions of this assertion. And yet, MySpace has a fullblown blogging platform with RSS feeds. Still waiting for that FaceBook RSS feed feature...
Posted by: chad | July 19, 2007 3:05 PM
Brian - Facebook is definitely where all the attention is for now. But as far as application development, once MySpace releases an API, we'll see all the same players (iLike, etc) release apps for them if they don't have them already. Ditto for Bebo and anyone else (Mosh, Orkut, Virb, etc) who makes their network accessible with an open platform API. When's the last time you saw a t-shirt shop or an ice cream place with a Facebook profile? Or a band with a Facebook profile? All these folks are still on MySpace.
Posted by: matt | July 19, 2007 3:10 PM
HAHA, Please don't compare Mark Zuckerberg to Steve Jobs, that video was so akward I had to stop watching it. A public speaker Mr. Zuckerberg is not.
Posted by: Nick Pulido | July 19, 2007 4:04 PM
Woo-hoo! I'm really looking forward to a future where I get to choose between (1) not being on the network most of my friends are on, and (2) maintaining five different "social network" profiles. I sure know how fun it is to sync my Blackberry with my Gmail contacts - I'm sure this will be at least as twice as fun, and just as useful as a phone that can only place calls to people "in network."
Posted by: Brock | July 19, 2007 4:11 PM
I think Facebook deserves the hype for developing their F8 platform. It was a genius move that's encouraging others to continue developing the usefulness of their website.
It must be pointed out though that Mark Zuckerberg is a terrible public speaker--awkward and without cadence. The Steve Jobs clip, on the other hand, gives me goosebumps.
Posted by: Michael Kebbekus | July 19, 2007 4:33 PM
@ Chad
There already is an RSS feed for the Facebook notes feature, subscribing to which gives you the latest notes from your friends.
You can also import any other blogs RSS feed if you don't want to be limited to Facebook Notes.
Posted by: Samaritan | July 19, 2007 4:37 PM
Every few days I stumble upon some rave review of Facebook and I log back in and poke around to see what I missed. And every time I'm left wondering what all the excitement is about. As far as I can tell, it's just MySpace with a slightly nicer style sheet and more restrictive content canvas.
Blog and read blogs. There's no substitute. Nobody's going to corner this market. Millions of voices are going just the opposite direction.
Posted by: Ralph Ogden | July 19, 2007 5:57 PM
While Mark Zuckerberg represents facebook right now, I think they would be smart to bring someone on to do most of the public speaking. It really can make a big difference for a company. Facebook is great, but it can't completely sell itself.
Posted by: bob cobb | July 19, 2007 8:49 PM
Hi Emre!
Interesting analysis!
Of course, Facebook's new platform has forced many startups to adapt their strategy. But they also opened their community to their competitors, which may not always be riskless...
I am member of the Ziki-Team and it is right that we recently brought out our V2 featuring a people search engine. But this move was not motivated by Facebook's strategy. We think that people search engines open a whole new access to information on the web and we simply answered to a growing demand of our users.
One of Ziki's most interesting features is probably the free search engine registration for all our members within Google, Yahoo!, MSN and its content networks. We make our users appear on the top of the search engine results for free. Have a look at it!
Posted by: Rupert Schiessl | July 19, 2007 11:59 PM
Zuck might not be Steve Jobs, but so far he seems to be doing a pretty damn good Bill Gates impression.
- dave mcclure
http://500hats.typepad.com/
Posted by: Dave McClure | July 20, 2007 1:39 AM
There already is an RSS feed for the Facebook notes feature, subscribing to which gives you the latest notes from your friends.
You can also import any other blogs RSS feed if you don't want to be limited to Facebook Notes.
Posted by: dizi muzikleri | July 20, 2007 2:27 AM
I think that as with any social community, there are always those who are going to have a favourite and go with it. I mean, I love the images I see at madspace.co.uk but Flickr are where my Moo cards get their backs from.
My friends interact with me on facebook (as do coworkers past and present) though things other people created and gave to facebook.
So many points in both the post and comments are completely valid making it a really complex issue.
Is Google really building a new social networking platform or will they just buy Facebook and where does that leave the developers who have contributed so much to Facebook - surely if those pieces add value they deserve something for their efforts...?
Facebook is kinda like Google - clean interface that was quite easy to use. With 'Personalisation' you've been able to add extra bits and move things around but it remains clean and simple. That's why I like Facebook over MySpace - but others will prefer the enhanced functionality of blogging. I like Twitter for blogging and it is available for Facebook but that's just me. I'm just weird *grins*
Posted by: Judith | July 20, 2007 2:44 AM
I think the debate is forgetting two very important factors.
1. The power of branding -
'What really separates a Facebook profile with 5 applications from a MySpace profile with 5 applications?'
The answer is simple: branding. Its such a hard thing to quantify, but Facebook has many more positive brand values in its arsenal than MySpace - and the perception is that they are the next big thing - a competitor for Google - which can only serve to raise Facebook's profile higher than say - it should be based on turnover.
2. Unpredictable users - the bottom line is that human behavior is hard to predict - sometimes humans can act on mass or on an individual level in the most illogical manner (Usage of PC vs Mac for example) - so on a macro level Facebook could (Probably will) become king and remain there even though other networks may supply better products. And on a micro level Mark Zuckerberg could surprise us all and go on not only to become an accomplished public speaker but also the next Steve Jobs... I doubt it though!
Posted by: Mark | July 20, 2007 3:24 AM
Seriously - for the amount of time all of you spend talking about Facebook, go outside, pick up some garbage, teach a kid to read, do something useful with your life.
I'm not saying stop using Facebook, just stop spending so much time talking about it. Why am I here writing this? Because I'm trying to get through to all of you - do something other than worry about what your friends did last night.
Posted by: 10668844 | July 20, 2007 4:13 AM
I would say Mark did an amazing job for his presentatiion. Not too bad for a 23-year old.
Posted by: nay min thu | July 20, 2007 5:22 AM
VIRB!
Posted by: Mark | July 20, 2007 6:39 AM
Interesting article and I wanted to tell your readers about Marzar the social media platform for businesses that is launching next month. Marzar has been talked of as a facebook for businesses and professionals.
You decide visit http://www.marzar.com where they are taking pre registrations for the launch.
Posted by: Tszar | July 20, 2007 7:14 AM
To the post above, isnt there already linked in? Seems kinda similar
Posted by: bob cobb | July 20, 2007 7:26 AM