Mark Zuckerberg’s Disaster Is Taking Silicon Valley with It(nymag.com)
nymag.com
Mark Zuckerberg’s Disaster Is Taking Silicon Valley with It
https://nymag.com/intelligencer/2022/02/mark-zuckerbergs-disaster-is-taking-silicon-valley-with-it.html
40 comments
I think reaction is more about fear of prospect future than actual signs of effective weakness.
People in the stock market are in a race to who's going to anticipate the future better and faster than others. What these people are projecting is that Facebook may not be dying now, but will start dying soon.
People in the stock market are in a race to who's going to anticipate the future better and faster than others. What these people are projecting is that Facebook may not be dying now, but will start dying soon.
Is revenue likely to continue growing if the user base is ... shrinking?
Good question. Too many variables to predict what will happen:
- The user base may not shrink, if they figure out how to build a competitor to TikTok.
- Some of the new projects may bring more users
- They can monetize WhatsApp
- The user base may not shrink, if they figure out how to build a competitor to TikTok.
- Some of the new projects may bring more users
- They can monetize WhatsApp
They already monetize WhatsApp, in a way, by harnessing it's data to increase value of their ads platform.
Not sure users would accept ads directly on their chat inboxes. Seems to me this kind of thing didn't work for Gmail, for example.
Not sure users would accept ads directly on their chat inboxes. Seems to me this kind of thing didn't work for Gmail, for example.
Nothing in the data backs the thesis of the article. Of the companies mentioned, Apple, Twitter, and Snap are all up in the past week, Snap by a double-digit percentage. Twitter rebounded by 7% the day after Meta’s earnings. Spotify missed on its own earnings. Otherwise only Microsoft is down, and that’s only by 1%. And it’s not at all clear how Apple short-circuiting Meta would reasonably be expected to tank Apple’s own stock.
This is what happens when you write an article based solely on one day’s worth of stock trading.
This is what happens when you write an article based solely on one day’s worth of stock trading.
Couldn't happen to a more deserving business model. The whole surveillance economy is one big dark pattern. Not only does it prey on consumers, it's not even a stable way to build and support the tech sector. If our best and brightest minds are using their most productive years trying to perfect the art of invasive spying in order to serve the advertising industry, what does that say about us as a country and a society?
It says we value free products over morals, which is pretty accurate of the current market forces.
It's always been a myth that markets are inherently moral. There's just no evidence of this, despite all of the debate that the free market is the end-all-be-all institution from which our lives should be dictated.
Markets optimize for one thing and one thing only: profit.
Markets optimize for one thing and one thing only: profit.
Not even once in my life have I heard the argument that markets are inherently moral.
To be fair, the choice was never given to us. There’s no such thing as a social network that people pay for that has no advertising or surveillance. This business model was chosen for us because it would lead to the fastest growth _for the company_.
>There’s no such thing as a social network that people pay for that has no advertising or surveillance.
Forums are commonly considered to be a form of social media/a social network, and there are still many that don't track users, don't have ads, and rely on a modest annual fee (WATMM's membership price is only $3/yr, for example) from users.
Forums are commonly considered to be a form of social media/a social network, and there are still many that don't track users, don't have ads, and rely on a modest annual fee (WATMM's membership price is only $3/yr, for example) from users.
Metafilter?
Did they even look at the financials? While I’m not a fan of Facebook the Meta business is very profitable. Markets overreact in the short term.
Markets don't care about revenue as much as growth. If a company isn't growing, it's dying and static revenue figures don't assuage investors.
With declining user engagement and investments in the metaverse still many years away from an ROI, the markets are essentially saying that Facebook doesn't have the high-growth runway they've been used to for all of these years anymore.
With declining user engagement and investments in the metaverse still many years away from an ROI, the markets are essentially saying that Facebook doesn't have the high-growth runway they've been used to for all of these years anymore.
I mean if a business’s value is its future cash flows and the recent news was that they had decreasing users and engagement plus decreasing revenue per user due to Apple’s privacy changes I would say that the market reaction is pretty reasonable.
Also beyond Facebook, I was listening to a podcast from Saxo Bank where they talked about how this could show more broadly a trend for declining engagement and growth for social media companies as we come out of covid and people begin spending less time on their devices than they did during the height of covid.
Also beyond Facebook, I was listening to a podcast from Saxo Bank where they talked about how this could show more broadly a trend for declining engagement and growth for social media companies as we come out of covid and people begin spending less time on their devices than they did during the height of covid.
I don't like FB much but most articles about it are just try-hard haterade.
We get it, media types, you hate Google and FB because they're better at serving ads than you. Figure out another business model.
We get it, media types, you hate Google and FB because they're better at serving ads than you. Figure out another business model.
The irony in this comment is absolutely wild. Facebook and Google have done more to capture ad revenue from media companies than just about anyone else through FB news and Google AMP. I'm sorry, but this a terribly misinformed opinion.
FB news and Google AMP are not why media ad revenue has cratered over the past 20 years. Do some research and try again.
Here, I'll even get you started: https://www.pewresearch.org/journalism/fact-sheet/newspapers...
Here, I'll even get you started: https://www.pewresearch.org/journalism/fact-sheet/newspapers...
> Six publishing sources, requesting anonymity out of fear of angering Google, said their ads load slower than their content on AMP, and that is part of the reason why they make less money per pageview from AMP than they do from their own websites. In one instance, the revenue per page on AMP was less than half of what the publisher got on its owned and operated properties. In effect, the user experience is almost too good, with content loading so fast that people scroll past the ads before they’ve been able to load, resulting in ads that aren’t deemed viewable.[0]
Google used AMP to control traffic, and therefore siphon ad revenue from publishers. I used to work for a newspaper and this was a huge problem for us, and Google absolutely knew about it.
0: https://digiday.com/media/publishers-find-google-amp-loads-f...
Google used AMP to control traffic, and therefore siphon ad revenue from publishers. I used to work for a newspaper and this was a huge problem for us, and Google absolutely knew about it.
0: https://digiday.com/media/publishers-find-google-amp-loads-f...
1. AMP requires publishers to submit AMP versions of their pages to Google. If publishers think AMP is a bad deal, all they have to do is stop submitting AMP pages to Google.
2. Newspaper revenue was plummetting for years before AMP came on the scene.
2. Newspaper revenue was plummetting for years before AMP came on the scene.
The amount of drop caught people’s attention but that huge drop has nothing to do with Facebook. The whole market is on edge right now and investors are convinced the bubble is popping and they are looking at everything as a sign to take money off. That scenario coupled with Facebook’s terrible image led to news stories. I do think Facebook is in a world of trouble though. TikTok is eating its lunch and they don’t have an answer to it. Oculus is burning cash and I don’t think it’s the answer to its troubles.
Reading this article I can't help but feel its for the better.
If we get to the point where one of the largest tech companies or groups of tech companies blames their downfall in revenue because of simply decisions made by their users. Then they're not doing what is beneficial to us and the technology is working against its users not for us. It's like banks putting out predatory loans and customers saying "hmm no thank you, that is not a smart financial decision" then the banks blaming their reduced revenue postings on customers not taking predatory loans.
I can appreciate the fact that these technology giants cannot function without revenue and that this revenue comes from advertisement over user subscriptions. After all Instagram, Facebook, snapchat and YouTube are all engineering marvels and they are free and they have always been free (of course there are premium options), way before we really cared about advertisements and user privacy.
I might be naïve, but I cannot see how these organisations could function any other way. If their main source of revenue is advertisement, which requires engagement, then of course they're going to optimize the way these services work in order to draw out maximum revenue. But if it comes at the detriment to its users and reduces the trust your customers have with your product due to privacy concerns. How do you change your model?
All of these services would continue to be fantastic if they removed their ability to advertise. We want to be able to share videos online, we want to be able to socialize with our friends and family online, but we don't want to be stuck doing it and we don't want to be targeted while we do it.
If we get to the point where one of the largest tech companies or groups of tech companies blames their downfall in revenue because of simply decisions made by their users. Then they're not doing what is beneficial to us and the technology is working against its users not for us. It's like banks putting out predatory loans and customers saying "hmm no thank you, that is not a smart financial decision" then the banks blaming their reduced revenue postings on customers not taking predatory loans.
I can appreciate the fact that these technology giants cannot function without revenue and that this revenue comes from advertisement over user subscriptions. After all Instagram, Facebook, snapchat and YouTube are all engineering marvels and they are free and they have always been free (of course there are premium options), way before we really cared about advertisements and user privacy.
I might be naïve, but I cannot see how these organisations could function any other way. If their main source of revenue is advertisement, which requires engagement, then of course they're going to optimize the way these services work in order to draw out maximum revenue. But if it comes at the detriment to its users and reduces the trust your customers have with your product due to privacy concerns. How do you change your model?
All of these services would continue to be fantastic if they removed their ability to advertise. We want to be able to share videos online, we want to be able to socialize with our friends and family online, but we don't want to be stuck doing it and we don't want to be targeted while we do it.
I tried FB, Google, and Amazon Ads with an IoT Product I Develop.
FB wasn't good. Instagram too. Even the ads I get as a consumer is bad. Instagram seems good for hyper local services though.
Amazon ads seems good in terms of sales compared to Google but the cost ends up high. They're essentially double dipping since you have to pay for FBA fees and Ads if you choose to.
I plan to just spend on Google Ads since it's DTC so there are no retailer fees to pay for.
As a consumer I like both Google and Amazon. I definitely buy more on Amazon and the ads are pretty effective in bombarding the customer, but the quality of the products from Google is much better. Partly because Google (and Youtube) is a great research tool when deciding which product to purchase. Also, a lot of the Google search results point to Amazon or other Shopping Portals.
Also article doesn't mention Oculus at all :$
FB wasn't good. Instagram too. Even the ads I get as a consumer is bad. Instagram seems good for hyper local services though.
Amazon ads seems good in terms of sales compared to Google but the cost ends up high. They're essentially double dipping since you have to pay for FBA fees and Ads if you choose to.
I plan to just spend on Google Ads since it's DTC so there are no retailer fees to pay for.
As a consumer I like both Google and Amazon. I definitely buy more on Amazon and the ads are pretty effective in bombarding the customer, but the quality of the products from Google is much better. Partly because Google (and Youtube) is a great research tool when deciding which product to purchase. Also, a lot of the Google search results point to Amazon or other Shopping Portals.
Also article doesn't mention Oculus at all :$
Okay. But your own experience doesn’t represent the majority of retailers out there. Having a retail business is about figuring out where your customers are and advertising to them. Your customers aren’t on Facebook or Instagram. Fair enough. But this isn’t just about hyper local, literally millions of business love those platforms (as much as I hate those platforms).
With the caveat that I don't know if I actually believe the premise...
Good.
The tech sector is, without a doubt, incredibly important, and we need it to be strong and innovative if we're to continue to make real advances. But Silicon Valley has become too entrenched, too risk-averse as a whole, and far, far too much up its own ass to recognize what the world in general actually needs.
Hardly a day goes by when I don't see someone working in the tech sector in California posting on here in ways that so clearly betray their staggering failure to understand how most people—including most people working in tech!—live, and by extension what they need, and what will improve their lives. The bubble is real, and it is pervasive.
The world does not need companies with trillion-dollar valuations. It does not need more ways to get people to click on ads. It does not need more ways to make already-wealthy people even wealthier.
What the world needs is a solidarity among tech workers (and others, of course) that recognizes that life, and human dignity and satisfaction, come first, and lets that recognition drive them to create software, hardware, and whatever else they can to improve those things. That's....not going to come out of Silicon Valley as it exists today, so if the shifts currently underway do take it down, I say so much the better.
Good.
The tech sector is, without a doubt, incredibly important, and we need it to be strong and innovative if we're to continue to make real advances. But Silicon Valley has become too entrenched, too risk-averse as a whole, and far, far too much up its own ass to recognize what the world in general actually needs.
Hardly a day goes by when I don't see someone working in the tech sector in California posting on here in ways that so clearly betray their staggering failure to understand how most people—including most people working in tech!—live, and by extension what they need, and what will improve their lives. The bubble is real, and it is pervasive.
The world does not need companies with trillion-dollar valuations. It does not need more ways to get people to click on ads. It does not need more ways to make already-wealthy people even wealthier.
What the world needs is a solidarity among tech workers (and others, of course) that recognizes that life, and human dignity and satisfaction, come first, and lets that recognition drive them to create software, hardware, and whatever else they can to improve those things. That's....not going to come out of Silicon Valley as it exists today, so if the shifts currently underway do take it down, I say so much the better.
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Spotify is a bad comparative example - it has had it's own PR problems. The narrative is questionable.
they missed earnings by 4.4% wasn't it?
Largest network in the world @ 17 p/e. With $50B in cash
Largest network in the world @ 17 p/e. With $50B in cash
The pandemic has brought forward the inevitable realization tbat Silicon Valley is not about changing the world for the better.
You can blame Jack Dorsey for all of it. When he started censoring newspapers, politicians, and presidents he painted a giant bullseye on all of big tech. Regardless of political leanings, as a politician you know that next time it might be you and your message being repressed, so it is best to get ahead of it. Just like newspapers and TV stations are kept in check by making sure no one person owns too many nor across too many markets, expect the same to happen to big tech. They will be broken up, forced to compete, and their money will get siphoned off to refill the coffers and make back all of the Covid stimulus spending.
Frankly it was inevitable because time and time again, politicians and celebrities violated Twitter's TOS and got away with it because of who they were and it eventually caught up to them.
I don't necessarily think Twitter was right to act in every single case that they did, but there were absolutely blatant examples of leaders violating Twitter's TOS. If you feel that politicians should be able to say anything they want all the time, then it's time call for abolishing the TOS altogether.
I don't necessarily think Twitter was right to act in every single case that they did, but there were absolutely blatant examples of leaders violating Twitter's TOS. If you feel that politicians should be able to say anything they want all the time, then it's time call for abolishing the TOS altogether.
What actually happened is Twitter strained all credulity to avoid punishing Trump for constant rule breaking until he was out of power, because they knew he'd literally have them killed.
They're still surprisingly soft on Chinese officials right now.
https://twitter.com/chenweihua/status/1334567538534084608
They're still surprisingly soft on Chinese officials right now.
https://twitter.com/chenweihua/status/1334567538534084608
Actually, almost all TV stations are consolidated under a handful of corporations.
So much that they even end up repeating exact phrases in their seemingly independent broadcasts, as seen in https://www.youtube.com/watch?v=QxtkvG1JnPk
This does not look like a dying company.
The article is very quick to jump to conclusions. The silicon valley is way more than Facebook. It is not clear even if Facebook will decline from here. Microsoft was able to survive 10 - 15 bad years due to their enormous size.
I don't expect Metaverse to bring them significant revenue anytime soon, but they have a good chance to copy TikTck and slow them down. They did a good job in slowing SnapChat before.
Source: https://seekingalpha.com/symbol/FB/income-statement#view_typ...