Facebook is Feeling the Pinch of Getting Outdated – Info Gadgets

Facebook is one big happy family of a “global community”. Image: NextShark

Facebook is showing its age, as Facebook’s miss in its Q2 results have spooked investors.

  • Facebook’s stock dropped a startling 24% after it announced its second quarter financial results on July 26th, 2018.
  • The company’s top executives warned about decelerating revenue, tightening margins and the ongoing effects of privacy policy changes as per CNBC.
  • In what can only be described as a “disastrous conference call”, Facebook value fell by as much as $148 billion.

Tech stocks are indeed at all-time highs and Facebook did not keep up with Alphabet’s amazing results. Still, the way Google and Facebook dominate mobile advertising globally outside of China is a bit scary (not in a good way).

The Rift Between Wall Street and Reality has Never Been Greater

So Facebook executives announced that the company expects a significant slowdown in its revenue growth in the years ahead and we know this, Mark has been somewhat transparent about it, thus Facebook is getting into odd things like dating and blockchain. Instagram has done a fair job of being Facebook reincarnate and while the platforms have ecosystems supposedly made up of billions of active users, besides Ads, Facebook have done a poor job at linking actual services and monetizing things such as WhatsApp, Facebook Messenger, and even what you can actually do on Instagram.

Mobile Advertizing Isn’t Forever

Stories and interruptive Ads may not be the answer, if you compare Facebook’s trajectory with the likes of Tencent, who have a similar but much more connected app with WeChat and how they approach the gaming industry. In my opinion, Wall St. investors have been irrationally bullish on Facebook’s stocks. Microsoft, Alphabet and Amazon all have far more diversified business models that can sustain growth — in a way that Facebook could not, if their Advertizing monopoly were to fall apart for whatever reason.

Facebook and Apple will Realistically Struggle to Keep Up

Realistically Apple and Facebook are indeed not shiny entities for the future of tech stocks. You are outdated when you are too reliant on current revenue models that belong to the past and lack innovation across industries. Keeping up with the likes of Amazon would mean Facebook needs to reinvent the future, something which it has moreover failed to do up until now. Millennials have realistically churned off of Facebook gradually as they have grown up.

Fully half of FANG are nothing but one-trick ponies. Netflix and Facebook do what they do well, but they aren’t agile AI companies that can own the future of their verticals indefinately.


Facebook is a Microcosm of the Decline of American Innovation

Facebook posted weaker-than-expected daily active users for last quarter and said revenue growth would decline sequentially in the second half of this year. Facebook have done a lot of things right, but their trajectory was just too absurdly successful to keep up. Shy of inventing their own cryptocurrency, what could they do? If only they had had the sense to copy WeChat’s model earlier on, western tech companies have been unable to replicate WeChat’s mini-programs, in the next innovation of what apps can become.

There is no western equivalent in 2018. Even worse, tech monopolies like Facebook have badly stunted innovation in Silicon Valley. The user experience is stale, the overvalued empire is not really innovating or a bleeding edge company in any way. Even the cheap reliance on user growth data is a bubble that’s beginning to pop.

Facebook is like a Jetson-company of all that’s wrong with America. One glossy coat of digital mobile paint, that can be hacked. From Chinese corporate espionage, to Russian algorithmic hacks on democracy, to an almost criminal abuse of user data, Facebook is one clunky machine, that is supposed to be a Tech empire that makes the world a better place. Zuckerberg may have greater interests in being the next president than in making his apps useful to people. Advertizing is enough, a tale of how America hijacked the evolution of the world wide web.

Article Prepared by Ollala Corp

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