Facebook wants to win your phone -- but what's the definition of winning?

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Facebook won on the desktop. All the other rival social networks have disappeared and it now seems very unlikely that another site will come along that does the same thing better, overtaking Facebook the way Facebook overtook Myspace.

But Facebook hasn’t won on mobile. It has 470m daily mobile users, yes, but there are also 300m people using Whatsapp, 200m using Line and dozens of other smaller apps with tens of millions of users. And people use all of these at once: the great majority of WhatsApp users have Facebook too, and had Facebook first but chose to use these other services as well. On mobile, Facebook is one of many social apps.

The problem for Facebook is two-fold. First, the mobile phone address book makes it much easier to use a new social network, because the app can just look at your phonebook to see which of your friends are already using it. No more tedious friend requests - your social network is already built. This removes a major ‘moat’ that protects Facebook on the desktop.

Second, these apps tend to unbundle the Facebook experience. None of them replace the whole thing: rather they take bits of Facebook and replace them with new and more focused products. They also, importantly, are starting to act as channels for distribution of content and games themselves, just as Facebook did.

Meanwhile Facebook itself has not, yet, nailed the right social experience, twisting and turning with new designs and satellite apps (Home, Messenger, Camera) as it tries to work out what ‘Facebook on Mobile’ really means.

It hasn’t lost either - not with 470m people using it on mobile every day. But it may be that that unbundling is itself the right experience - that having lots of types of service in one place just makes more sense on a big desktop PC screen than it does on a smartphone.

It’s not clear how this will play out - will all of the mobile-only services consolidate into regional winners (as happened with IM)? Will Facebook crush them over time (as it crushed regional desktop social networks - remember Orkut)? Or will people just use lots of them, all the time, chipping and chaining from one to another as the context and needs change? This, to me, seems most likely.

The interesting question for Facebook is how much this matters - does it need to be dominant on mobile, or is the mobile opportunity just so big that ‘first amongst equals’ is enough? The Q2 results suggest the latter, with mobile growing at 75% quarter on quarter.

Perhaps for Facebook, being the biggest of many is enough.



Benedict Evans

Tech/telco banking, then TMT BD & strategy (Orange, C4, NBCU). Now a freelancer looking for difficult things to do. I do real analysis elsewhere, mainly at Enders.

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