The Worst Day of Mark Zuckerberg’s Reign

Kevin T. Dugan, writing for New York Magazine Intelligencer, explains the slide of Facebook.

At times, an earnings report causes a stock’s price to fall precipitously only for it to moderate in the hour or so after, when the company’s executives calm down Wall Street by saying that all is not so bad. This time, it didn’t work that way. In fact, Facebook’s price continued to slide even lower. Zuckerberg, in his trademark nasal drawl, seemed to acknowledge that the tide was turning against the business he has been running for 18 years as of this week. The balance of content that people see in feeds is shifted a little bit more towards stuff that isn’t coming from their friends, which they may discuss with their friends, but it’s kind of shifting towards more public content,” he said. The upshot here is that the voyeuristic behaviors that made social media as we know it so profitable — what are my friends talking about? Who did my high school ex marry? — were actually starting to fade.

It dropped from $900 million to something like $670 million. That’s what happens when individuals and companies start killing the ad tracking power of Facebook. People are finally quitting the app. I mean, these apps and companies aren’t going disappear. However, I can easily see Facebook and less so Instagram turning into Tumblr or worse Friendster.

No one under 20-25 uses Facebook. They might use Instagram, but not Facebook. The bottom line is Facebook can’t recruit new users for the same reason people don’t start smoking in their 30s. They’ve learned not to even start.

Social networks have a shelf life. Just ask what’s-his-name from MySpace.

February 3, 2022


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