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This is going to be perhaps the first prediction that announces something dismal about Facebook’s future. The social network has been progressing by leaps and bounds and has been doing great overall. However, even since the company went public, its share has only fallen down, stumbling from a $38 opening to somewhere near $26. And the chief reason for this is that Facebook still has to monetize its mobile audience.


With an explosive growth of the mobile platform, more and more users are flocking to it. The only problem for Facebook, in this migration, is that it hasn’t been able to figure out a way to monetize the mobile platform. It can’t display ads on its mobile version since that would virtually congest the display. And that’s where, the founder of Ironfire Capital, Eric Jackson, thinks lies Facebook’s doom.

According to Jackson, “In five to eight years they are going to disappear in the way that Yahoo has disappeared. Yahoo is still making money, it’s still profitable, still has 13,000 employees working for it, but it’s 10% of the value that it was at the height of 2000. For all intents and purposes, it’s disappeared.”

Jackson divides tech companies into three generation. The first generation, according to him, was lead by the likes of Google and Yahoo. Facebook debuted the second generation by capitalizing on the explosive social media. And finally, the third generation is going to be that of the mobile platform.

He says, “When you look over these three generations, no matter how successful you are in one generation, you don’t seem to be able to translate that into success in the second generation, no matter how much money you have in the bank, no matter how many smart PhDs you have working for you.”

The acquisition of multiple mobile companies, he thinks, is not going to help Facebook either. According to him, “The world is moving faster, it’s getting more competitive, not less. I think those who are dominant in their prior generation are really going to have a hard time moving into this newer generation. Facebook can buy a bunch of mobile companies, but they are still a big, fat website and that’s different from a mobile app.”

What remains to be seen is that can the genius behind Facebook, Mark Zuckerberg, find out a way to successfully translate his company from a web-based social network to one that can cater to and monetize the mobile platform too.

Source: CNBC

Courtesy: Mashable

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  On June 5, 2012(3 years, 11 months ago.)

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1 Response

  1. Miquel Polk Says:

    no matter how many smart PhDs you have working for you.”

    Posted on June 5th, 2012 at 6:28 PM

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