Facebook looking to app-focused future

Facebook looking to app-focused future

29 OCT 2014

Facebook plans to ramp up efforts around its mobile apps to make them into successful standalone businesses, Mark Zuckerberg (pictured), the company’s CEO, said during the company’s results presentation.

“Over the next five years our goals are around taking our next generation of services – Instagram, Messenger, WhatsApp and search – and helping them connect billions of people and become important businesses in their own right,” Zuckerberg said.

He said “one big priority” is messaging, with efforts to grow the home-grown Messenger product and newly-acquired WhatsApp.

The Messenger functionality was recently removed from the main Facebook apps on iOS, Android and Windows Phone, meaning people had to download the standalone app to continue to use the service.

“We believe this change allows us to offer a better and faster messaging experience on mobile,” Zuckerberg said, noting that people who use the Messenger app respond around 20 per cent more quickly to messages than when the functionality was within the main app.

The Facebook CEO said the company believes WhatsApp and Instagram are on the way to reaching one billion people within five years, a scale at which they will become “meaningful businesses in their own right”.

It should be noted that Instagram’s user base currently stands at a more modest 200 million.

Zuckerberg reiterated that there are no plans to monetise these products aggressively in the next couple of years as the company believes the best approach to fully realise the potential of the products is to initially focus on connecting more people.

Financial figures published this week revealed that WhatsApp actually made a $232.5 million loss for the first six months of 2014. This compared to a $58.8 million loss for the first half of 2013.

The company’s income statement also revealed that its revenue, which is largely from the sale of subscriptions to the messaging service after one year of free use, totalled $15.3 million, compared to $2.8 million for the year-earlier period.

Turning to Instagram specifically, Zuckerberg said “a lot of progress” was made during the third quarter, with strong international growth over the past year — exceeding 100 per cent in some countries.

In addition, Instagram users now spend 21 minutes per day using the app, which Zuckerberg said was evidence that the strategy for Instagram “is on the right path”.

Instagram launched a standalone time lapse video app on iOS in August, while there has been heavy investment to improve the speed and performance of the core app on Android.

The company is continuing to roll out ads on the photo sharing service. “We think there’s good opportunity with both video and Instagram ads but we’re going to remain deliberate and slow in our approach to scaling both businesses,” explained COO Sheryl Sandberg.

Zuckerberg also addressed the work Facebook is doing to help developers, saying that the goal is “to make Facebook the cross-platform platform that allows developers to build, grow and monetise their apps across every major mobile platform”.

Facebook’s Audience Network was launched globally in the third quarter, allowing more than 1.5 million advertisers to extend their campaigns to mobile and for developers to begin monetising their apps.

Zuckerberg also touted the continued adoption of App Links, which enable developers to link to content within apps. They are now being used by “hundreds” of apps on iOS, Android and Windows Phone and developers have created links to more than three billion individual destinations within apps over the past six months.


Tim Ferguson

Tim joined Mobile World Live in August 2011 and works across all channels, with a particular focus on apps. He came to the GSMA with five years of tech journalism experience, having started his career as a reporter... More

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