One of the rumors from last week was that Snapchat turned down an acquisition offer from Facebook valued at $3 billion. As always in these situations (cf Groupon) one doesn’t know whether such an offer really existed or how firm it was (and there is also the question of how quickly and easily it would have closed). But this story is clearly related to another story which Jenna Wortham reported on in the New York Times on the weekend: the decline of Facebook usage among teenagers. Clearly one of the places that teenagers’ usage has migrated to is Snapchat.
I don’t find this particularly surprising. I have long felt that Facebook was deeply flawed in a couple of important ways. First, it has the false basic premise that there is such a thing as an intermediate privacy level between completely private (as in email, very small groups) and completely public (as in open Internet, Twitter). Users are beginning to understand this better and it didn’t help that over the years Facebook has made numerous changes to its privacy settings often making them, well, less private. Second, Facebook has tried to suck the activity of other networks into itself and be the one network to rule them all with its social graph initiatives. But people are finding that they want to follow / discover / connect with different people in different contexts. And so separate graphs like Wattpad (writing), Soundcloud (music), Heyzap (games) all make sense, as do more specialized ones such as Academia.edu and ResearchGate. Incidentally, the brouhaha over at Youtube about the forcing of G+ comments is much about the same issue. Third, the increasing time spent on mobile is giving an edge to applications that do less but do it better. I have written about this unbundling effect of mobile before.
So what does it all mean for Facebook? I think it still has a formidable position due to the widespread use of login with Facebook and the huge overall user numbers. But the clock is ticking on the company determining what it wants to be when it really grows up. It could still be an important part of online identity. But to to succeed in that, the company would have to fundamentally rethink its relationship with its endusers and with third party services. That’s a tall order and would have to start at the top with Mark Zuckerberg himself.
