Case study - Management
Review the Case Study Rubric and Peer Review questions (below) for details on how the Case Study will be graded. Based on Chapter 11 in your textbook, create a Paper that thoroughly answers in written paper / paragraph format one of the following questions: What is a walled garden? Facebook has been called a walled garden. Name other firms that might also be described in this term. In your opinion, is Facebook a walled garden? What might be the consequences if the firm is widely viewed as being more powerful and less open? OR Do you agree with Mark Zuckerberg that “connectivity is a human right”? What goal do governments and the private sector aim for in helping empower disenfranchised populations? The official form and style format for the College of Business is APA. You must use appropriate APA format for citations and references. Using your text book and Library Resources include 2 or 3 resources to support your answers / point of view. Review information to Automatically Format Bibliography in Word (Links to an external site.). The instructor will be grading the 750+ Microsoft Word paper using the Case Study rubric.
Chapter 11
Learning Objectives
1. Be familiar with Facebook’s origins, rapid rise, and rocky first-year performance as a public company.
2. Understand how Facebook’s rapid rise has impacted the firm’s ability to raise venture funding and its founder’s ability to maintain a controlling interest in the firm.
It’s hard not to be awed by what Mark Zuckerberg has created. An effort launched from his college dorm is now a species-level phenomenon. Even after deleting a jaw-dropping two billion fake accounts, roughly one in every five people on the planet has a Facebook account—an amazing track record given that Facebook is technically banned in China (taking about 20 percent of the world population off the table). Want to connect to customers? Facebook is increasingly the place to be. The firm’s daily traffic is three times larger than the viewership of the Super Bowl. Facebook accounts for the largest share of the most popular activity (social networking) on the most widely used computing devices (smartphones). The firm’s growing arsenal of apps accounts for 30 percent of US mobile Internet use. And even after two brutal years of bad press following controversies over fake news and abuse of user data, as of this writing it is the fifth most valuable public company on Earth. Outside the US, global growth is on a tear, with over 85 percent of Facebook users coming from abroad, and Zuckerberg, through his philanthropic effort Internet.org, is determined to put the entire planet online.
Figure 11.1 Largest Firms by Market Cap (in billions of $USD)
Facebook is among the most valuable firms on the planet.
Source: Public data, Aug. 30, 2019.
The Rise of Facebook and Growing Concerns
Facebook founder Mark Zuckerberg looked like a social media pioneer from the start. Consider this: During the weeks he spent working on Facebook as a Harvard sophomore, he didn’t have time to study for a course he was taking, “Art in the Time of Augustus,” so he built a website containing all of the artwork in class and pinged his classmates to contribute to a communal study guide. Within hours, the wisdom of crowds produced a sort of custom CliffsNotes for the course, and after reviewing the Web-based crib sheet, he aced the test. Turns out he didn’t need to take that exam, anyway. Zuck (that’s what the cool kids call him) dropped out of Harvard later that year.
By the age of twenty-three, Mark Zuckerberg had graced the cover of Newsweek, been profiled on 60 Minutes, and was discussed in the tech world with a reverence previously reserved only for the late Steve Jobs and the Google guys, Sergey Brin and Larry Page. Zuckerberg went on to be named Time’s “Person of the Year,” and The Social Network, a (mostly fictionalized) account of Facebook’s founding, was a box-office smash, nominated for a Best Picture Academy Award. Facebook’s controversial 2012 public offering valued the firm at over $100 billion, and the $16 billion raised in the offering made it (at the time) the biggest tech IPO Initial public stock offering, the first time a firm makes shares available via a public stock exchange, also known as “going public.”in history and the third biggest IPO ever. Zuckerberg’s net worth topped $19 billion.
Post IPO many analysts were concerned Facebook wouldn’t realize its growth potential, and the stock began to fall. No longer. 2018 revenues were over $55 billion. Profits topped $22 billion (to put that in perspective, Disney’s 2018 profits—tallying everything from theme parks to Pixar, Star Wars, and Marvel movies to ABC and ESPN—didn’t even hit $12.6 billion). Mobile was an early concern—the firm made no money on mobile at the time of its IPO. Today mobile brings in over 90 percent of Facebook advertising revenue, and Facebook’s stock has gone up alongside Zuck’s ability to prove his firm can mint cash.
The lofty ideals of Facebooks founding ethos - to make the world more open and connected - seems to have crashed and burned in a grisly and unprecedented pileup of bad actors, ham-handed responses, misunderstanding, and justifiable concern. Facebook has become a tool for harm and exploitation, with deft manipulators of the platform including Russian operatives, genocidal monks in Myanmar, and a Filipino populist accused of orchestrating thousands of extra-judicial killings. Platform partners, most notably Cambridge Analytica, have violated the firms data policies and fueled worldwide outrage. The platform has inadvertently streamed a racist’s mass murder, fueled conspiracy theorists, served as an organizing force for terrorists, extremists, and holocaust-deniers, and has struggled to balance privacy and free speech. Employee discontent and several high-profile resignations include the founders of Facebook-owned WhatsApp and Instagram. A Facebook co-founder has called for the firm to be broken up, as its power gives it “unilateral control over free speech”; while a WhatsApp founder, wildly rich from the acquisition, had grown so disenchanted that he tweeted it was time to #DeleteFacebook (and apparently abandoned $850 million in potential earnings with his departure). A souring reputation may also prompt existing and potential employees to take a look at other options. The firm had become one of Silicon Valley’s most aggressive practitioners of the acqui-hireReferring to “acquiring” a firm as a way to “hire” talent.—acquiring startups as a means of securing new talent, but will it still be a top acquisition choice for founders amid rivals, some who offer the option of an IPO payout?
The press combed through hundreds of leaked internal messages, sharing the most unflattering and lurid, including an Apple terms-of-service-violating app that paid people (some as young as thirteen) $20 a month to let Facebook access all of their smartphone data, including calls, text, and location. The US Federal Trade Commission leveled a $5 billion fine on the firm for mishandling users personal information—by far its largest-ever penalty for a technology firm. Amid relentless criticism, many of the powerful failed to fully understand the firm. For example, Senior US Senator Orrin Hatch stated “So, how do you sustain a business model in which users don’t pay for your service?” Zuckerberg (visibly surprised at the question) responded, Senator, we run ads.
Facebook side projects like brain controlled wearables, a “virtual assistant” that listens to every word in your home, and the firms own government-free cryptocurrency underscore Zuck’s new role as super villain. After all, the guy who portrayed him in The Social Network went on to play Superman rival Lex Luthor.
Negative press, massive penalties, and public outrage like this would kill most firms, yet as of this writing Facebook has been enjoying record profits and while its stock price has roller-coastered, it hasnt seen a consistent cratering. All speak to the power of network effects and switching costs embedding the firms services deep within the lives of consumers, worldwide. Through all this, Zuck has announced yet another tack—declaring that as far as Facebook is concerned, “The future is private!” Plans include encrypting message apps (itself controversial to governments who want a peek at potential terrorist communications). And the firm that built the feed into an oft-imitated and wildly powerful communication channel intends to create living room style communities, rather than promoting the shouting matches of a town hall. How much regulation is coming? Can the firm pivot to a privacy-promoting, consumer-friendly vision while satisfying customers and the advertisers that pay its bills and bring in profits? And can it do so before a wily rival finds a new method to disrupt the status quo and snatch away customers?
Why Study Facebook?
Trying to distinguish the reality from the hype, and balancing risk vs. reward is a critical managerial skill. In Facebook’s case, there are a lot of folks with a vested interest in figuring out where the firm is headed. If you want to work there, are you signing on to a firm where your stock options and 401k contributions are going to be worth something or worthless? If you’re an investor, should you short Short selling is an attempt to profit from a falling stock price. Short sellers sell shares they don’t own with an obligation of later repayment. They do so in the hope that the price of sold shares will fall. They then repay share debt with shares purchased at a lower price and pocket the difference (spread) between initial share price and repayment price.the firm or increase your holdings? Would you invest in or avoid firms that rely on Facebook’s business? Should your firm rush to partner with Facebook or seek alternatives? Does Facebook deserve your firm’s ad dollars and staff attention ahead of other methods of consumer engagement? If you’re a banker, examining the strengths and weaknesses of Facebook may help you make better decisions on whether or not you’d extend a firm like this credit. Should you offer it better terms to secure its growing business, or worse terms because you think it’s a risky bet? And can we learn something from how the firm has handled its growth amid multiple crises and product pivots? Let’s look at the fundamentals with an eye to applying what we’ve learned about tech industry strategy, competition, and competitive advantage. No one has a crystal ball, but we do have some key concepts that can guide our analysis. There are a lot of broadly applicable managerial lessons that can be gleaned by examining Facebook’s successes, missteps, and continuing evolution. Studying the firm provides a context for understanding network effects, platforms, partnerships, issues in the rollout of new technologies, privacy, ad models, the business value of social media, the differences between desktop and mobile markets, and more.
Zuckerberg Rules
Many entrepreneurs accept startup capital from venture capitalists (VCs), investor groups that provide funding in exchange for a stake in the firm and often (especially in early-stage investments), a degree of managerial control (this may be in the form of a voting seat or seats on the firm’s board of directors). Typically, the earlier a firm accepts VC money, the more control these investors can exert (earlier investments are riskier, so VCs can demand more favorable terms). VCs usually have deep entrepreneurial experience and a wealth of contacts and can often offer important guidance and advice, but strong investor groups can oust a firm’s founder and other executives if they’re dissatisfied with the firm’s performance.
At Facebook, however, the firm’s extraordinary early growth left potential investors salivating to back a firm perceived as being less risky but carrying the potential of a huge upside. Early backers ceded control; at a time when Facebook’s board had only five directors, Zuckerberg appointed three of them. When Facebook filed to go public, Zuckerberg’s ownership stake stood at 28 percent, but Facebook created two classes of shares, ensuring that Zuckerberg maintains a majority of voting rights in the public company and virtually guaranteeing that his control of the firm continues, regardless of what investors say. Maintaining this kind of control is unusual (although not unprecedented—Google’s founders have a similar ownership and voting structure). Zuckerberg’s influence is a testament to the speed with which Facebook expanded. When investors’ demand to get in on “the next big thing” remains high, a firm’s owner can extract extraordinary terms for the privilege of coming along for the ride. It also empowers Zuckerberg to make bold, long-term, potentially money-losing bets with less shareholder scrutiny than a typical public company. As Slate puts it, Facebook is “conducting an experiment in corporate dictatorship nearly without precedent for such a large and high-profile company.” All hail Emperor Zuckerberg!
Facebook’s Copilot
Don’t let Zuck get all the credit. While Facebook’s founder is considered the firm’s visionary, chief operating officer Sheryl Sandberg is often depicted as the person who runs the place: the coach, the seasoned mentor, the drill sergeant, and the voice of experience in a workforce that skews remarkably young despite its vast, global influence. With her successful track record at Facebook she can add another powerful descriptor: billionaire.
Regularly named to Fortune magazine’s “Most Powerful Women in Business” list, Sandberg came to Facebook from Google (before that, she was chief of staff to US Treasury secretary Larry Summers). In just three years, she’s helped steer Facebook to almost unimaginable heights. Users increased tenfold, she’s helped devise an advertising platform that has attracted the world’s largest brands, she’s developed a sales organization that can serve a customer base ranging from the Fortune 100 to mom-and-pop stores, and she’s helped the firm through several crises, all while turning a profit and pushing revenue higher.
Sandberg, a Harvard grad, left the school with a geeky legacy akin to Zuckerberg’s. When she was a student conducting economics research she ran so much data on Harvard’s network that she choked the system. Zuckerberg would have much the same impact more than a decade later.
Sheryl Sandberg is a powerful speaker and a leading advocate for increasing the ranks of women in senior management, and her book on the topic, Lean In, became a bestseller.
Sheryl Sandberg Speaks
Key Takeaways
· Facebook was founded by a nineteen-year-old college sophomore and eventual dropout.
· It is currently the largest social network in the world with usage rates that would be the envy of most media companies.
· Despite the firm’s rapid growth and initially high stock market valuation, Facebook faces several challenges, including generating more revenue from its customer base, growing advertising, monetizing mobile, transitioning to a mobile-centric world where competitive conditions differ, protecting user privacy, potential for abuse, and competing with a slew of new competitors, some challenging Facebook’s openness edict—all amid rising personnel and infrastructure costs.
· The firm’s rapid growth and high user engagement allowed Facebook’s founder to demand and receive an exceptionally high degree of control over the firm—even as the firm went public.
Facebook’s mission, as stated by Zuckerberg, is “to make the world more open and connected.”From a social network initially targeted at college students, Facebook has become a relentlessly advancing and evolving force, occupying large swaths of user time and expanding into all sorts of new markets.
The Social Graph and Why Facebook’s Is So Strong
At the heart of Facebook’s appeal is a concept Zuckerberg calls the social graphThe global mapping of users and organizations and how they are connected., which refers to Facebook’s ability to collect, express, and leverage the connections between the site’s users, or as some describe it, “the global mapping of everyone and how they’re related.” Think of everything that’s on Facebook as a node or endpoint that’s connected to other stuff. You’re connected to other users (your friends), photos about you are tagged, comments you’ve posted carry your name, you regularly declare your preferences and things that you “like,” you’re a member of groups, you’re connected to applications you’ve installed—Facebook links them all.
Facebook was established in the relatively safe cocoon of American undergraduate life and was conceived as a place where you could reinforce contacts among those who, for the most part, you already knew. The site was one of the first social networks where users actually identified themselves using their real names. Since “friending” (which is a link between nodes in the social graph) required both users to approve the relationship, the network fostered an incredible amount of trust among its user-base. Today, many Facebook users post their cell phone numbers and their birthdays, offer personal photos, and otherwise share information they’d never share outside their circle of friends. Despite the many public privacy concerns the firm has faced, trust remains one of Facebook’s most distinguishing features—bringing along with it a degree of safety and comfort that enabled Facebook to become a true social utility and build out a solid social graph consisting of verified relationships.
There is also a strong network effectAlso known as Metcalfe’s Law, or network externalities. When the value of a product or service increases as its number of users expands. to Facebook (see
Chapter 8 “Platforms, Network Effects, and Competing in a Winner-Take-All World”
). People are attracted to the service because others they care about are more likely to be on Facebook than anywhere else online. And that large user base has also attracted all sorts of firms and organizations looking to connect with Facebook’s masses. Without the network effect, Facebook wouldn’t exist. And it’s because of the network effect that another smart kid in a dorm can’t rip off Zuckerberg in any market where Facebook is the biggest player. Even an exact copy of Facebook would be a virtual ghost town with no social graph.
The switching costsThe cost a consumer incurs when moving from one product to another. It can involve actual money spent (e.g., buying a new product) as well as investments in time, any data loss, and so forth. for Facebook are also extremely powerful. A move to another service means recreating your entire social graph. The more time you spend on the service, the more you’ve invested in your graph and the less likely you are to move to a rival.
FB 2019 Keynote in 12 Minutes
An overview of Facebook product introductions at F8 2019 include an emphasis on privacy, more personal engagement with messaging and groups; expansion of the firm’s Dating, Workgroups, and Health features; shopping and payment improvements; and improved products for its AR and VR offerings.
Source: (
The Verge via YouTube
)
Facebook Feed: Viral Sharing Accelerated
While the authenticity and trust offered by Facebook was critical, offering news feeds concentrated and released value from the social graph. With feeds, each time you perform an activity on Facebook—make a friend, upload a photo, join a group—the feed offers the potential to blast this information to all of your connections. Firms and products that you “Like” on Facebook can post messages that may appear in your news feed (where you can like and comment on their posts and share the messages virally), making Facebook a key channel for continued customer engagement. The evolving “Like” button now allows users to share “reactions” including “wow,” or that they are “sad” or “angry,” with each interaction adding to Facebook’s data asset and offering deeper insight on users and posts.
Facebook continues to refine feeds, including categorizing sharing in several ways. You can find updates on the “news feed” that Facebook actively curates by default. A “timeline” on your personal page offers a sort of digital scrapbook of content that a user has shared online. Not everyone see every post to their feed. Like Google, Facebook uses a secret and constantly refined algorithm that attempts to identify what you’re most interested in, while cutting “spammy” content. Facebook’s engineering manager for news feed estimates that there are as many as “100,000 individual weights in the model” that determines if you’ll see a post. Some of the more significant factors include the past interest of a given user in the content’s creator, a post’s performance among other users, performance of past posts by the content creator, the type of posts a given user prefers (e.g., status, link, photo, etc.), and the recency of the post. And don’t beg for likes or reshares. That’ll get your post punished, decreasing its reach. Users can also tweak their news feed settings, and opt to see posts based on recency rather than algorithmically determined “Top Stories.” An awareness of key factors and “dos and don’ts” is critical to any organization looking to use Facebook for engagement. And of course, Facebook will gladly allow you to advertise to extend a post’s reach. (Not surprisingly, as Facebook has significantly cut the organic reach of brand page postings, the firm’s “Promoted Post” ad business has increased.)
Facebook rules as kingmaker, opinion catalyst, and traffic driver, so media outlets are eager to be friends. While in the previous decade news stories would carry a notice saying “Copyright, do not distribute without permission,” today’s newspapers display Facebook icons alongside every copyrighted story, encouraging users to “share” the content on their profile pages. Facebook beats rivals in driving traffic to newspaper sites, and it’s also way ahead of Twitter and Pinterest in overall social traffic referrals. Games firms, music services, video sites, daily deal services, publishers, and more all integrate with Facebook, hoping that posts to Facebook will spread their services virally.
Amid Facebook’s privacy struggles, the firm is attempting to leverage the strength of the social graph, while addressing concerns and offering solutions that keep it front and center as a communication tool of choice. Group features in the Facebook experience (sometimes called the “blue” app) in browser and mobile have been expanded to make it easier to discover and join group. Health groups now offer anonymous posting, employers have new tools to communicate with employees, and communications across Facebook are gaining end-to-end encryption. Facebook hopes new features in messenger that encourage chat and sharing with a smaller crowd than the legions of people you may have “friended” over the years, and the introduction of threaded discussions, will help people migrate to a more private platform that remains within Facebook’s ecosystem.
Facebook’s Dominance on the Desktop
Facebook has gradually turned on features that have allowed the firm to leverage its massive user base to encroach on a wide swath of Internet services (link sharing, photo sharing, and messaging to name a few). But even as we tally Facebook’s successful envelopmentA strategy whereby a firm with a significant customer base adds a feature to an existing product or service and eliminates the need for any rival, stand-alone platforms. Think Apple adding video to cameras, crushing the market for the Flip cam. of new product categories, there is increasing evidence that mobile presents new challenges where the old “turn on a feature and dominate” dynamics at play on the desktop simply aren’t as strong.
First, let’s look at desktop Facebook’s past ability to envelop markets. In photos, Google, Yahoo!, and one-time standout MySpace all spent millions to acquire photo-sharing sites (Picasa, Flickr, and Photobucket, respectively). But to become the Web’s leading photo-sharing service, Facebook didn’t acquire anyone. The site simply turned on a substandard photo-sharing feature and quickly became the biggest photo-sharing site on the Web. Facebook users now post over 350 million photos each day. When Facebook turned on chat, it became the first-choice communication service for many in its growing customer base, displacing instant messaging platforms that had massive early leads and millions of subscribers. Facebook’s feed crushed the appeal of independent link-sharing services like Digg and Del.icio.us. Video is huge on Facebook, too. The firm serves as many views a day (4 billion) as YouTube, and followed Twitter’s Periscope with its own Facebook Live video streaming tool, even paying celebrities and media companies to create and share content on the site. Facebook even wants to be your better address book, business directory, and phone dialer. Facebook has a craigslist rival in its Marketplace feature, a workplace collaboration tool in Workplace by Facebook, and Mark and Sheryl will even play cupid with a new Dating feature, which, at launch, sent shares of Match.com plummeting. While many of the firm’s experiments have failed (remember the Facebook phone? Didn’t think so) or did not achieve traction as initially hoped, they underscore Facebook’s innovation culture, and the firm’s relentless drive to experiment with new opportunities for social engagement. As Facebook is able to insert itself into new markets and envelop markets owned by other firms, we see a key advantage to Facebook’s central role in the lives of consumers. Network effects, switching costs, and the firm’s influence in catalyzing the spread of new products and services allow the company to quickly apply its installed base in key markets. Budding entrepreneurs beware: Are you building a business with sustainable advantage or a feature that will one day be wiped out by similar technology built into Facebook?
Facebook Takes On Search
Google, watch your back, Facebook is tinkering there, as well. Google indexes some Facebook content, but since much of Facebook is private, accessible only among friends, most Facebook activity represents a massive blind spot for Google search. Sites that can’t be indexed by Google and other search engines are referred to as the deep WebInternet content that can’t be indexed by Google and other search engines.. Early experiments incorporating Facebook with Microsoft Bing have been canceled, but any search that prompts a user to start at Facebook instead of Google is a revenue and data collection opportunity for Zuck and not Sundar (Pichai, CEO of Alphabet’s Google division).
Facebook has introduced Graph Search, intending to evolve search beyond the keyword. With Graph Search, Facebook allows users to draw meaning from the site’s social graph and to find answers from social connections. Planning an outdoorsy getaway and looking for ideas from friends you trust? Use Graph Search to collect photos of friends at National Parks. Some have claimed Graph Search could become a primary source for job placement, travel info, dating, and more—all areas where Facebook has, to some extent, experimented.
Graph Search results are based in part on the connections in your social graph, but you also have access to your past posts as well as any information that the billion-plus member Facebook community chooses to make public. Consider this when selecting your privacy settings. There’s an active Tumblr account showing embarrassing Graph Search results. Perhaps more seriously, critics have demonstrated how Graph Search could be used by foreign governments to uncover, say, members of China’s banned Falun Gong movement or identify gays and lesbians in nations where homosexuality is outlawed and punishable.
Why Mobile Is Different and in Some Ways Better than the Desktop
Facebook has been able to envelop all sorts of desktop services by simply adding a feature to its browser-based product, but with the rise of mobile, Facebook’s dominance no longer looks like a given. It lost an early leadership into mobile photo sharing to Instagram. WhatsApp grew to be the worldwide leader in messaging clients for mobile, while others such as WeChat, Line, and KakaoTalk enjoy hundreds of millions of users in different locations throughout the world. Gaming firms, which once flocked to the Facebook platform as a fast path to riches, now see a more promising future in developing mobile apps. Deep-pocketed Facebook spent serious coin to acquire Instagram and WhatsApp, but they can’t acquire everyone. The savvy manager can learn from Facebook’s mobile challenges to understand how mobile differs from the desktop.
And mobile is different. Many of the winner-takes-all dynamics of social on the desktop Web, which Facebook had leveraged so astutely to weave its way deeper into the lives of its users, do not appear to apply on mobile. Ben Evans, a partner at the venture firm Andreessen Horowitz, writes what many consider to be a must-read tech industry weekly newsletter (sign up at
https://www.ben-evans.com/newsletter/
). He points out that there are at least four areas where the competitive dynamics of smartphone apps differ from browser-based desktop services:
1. Smartphone apps can access a user’s address book. This makes it easier to rebuild the social graph for a new mobile service.
2. Smartphones apps can access a phone’s media library and can often plug into cloud storage. This makes it easier to share photos and video than on desktop services.
3. Smartphone apps can use push notifications, a huge benefit for increasing engagement. While new standards now allow some degree of desktop notification, these are often so disruptive that they are ignored or shut off. Desktop services have long relied on e-mail notifications or hoped users remembered to return to a Web site, but mobile push notifications instantly say, “Hey, there’s something new here for you to pay attention to within our great app that you signed up for,” and offer single-tap reentry into a service.
4. Smartphone apps also get an icon on the home screen. A constant visual reminder for a service, often with a compelling notification badge that motivates a compulsion to check things out so the badge goes away. Single-tap access is also far better than bookmarking or typing in a URL.
5. While a desktop site can crush a new competitor by adding a feature as a new menu item or icon, on mobile there isn’t the screen real estate for this—another reason mobile seems to favor single-purpose, specialized apps.
6. And we can add another advantage: authentication. Many firms have begun to offer “sign-on with mobile” as an alternative to using passwords. Many think this is an even more secure way to sign in since it’s attached directly to a device that follows the user and which many users additionally lock with a passcode.
While many considered mobile platforms to be more limiting than the desktop—the screen size was smaller, typing was more difficult on a mobile device—there are plenty of things that a smartphone can do better than a laptop or desktop. As Evans states, “there’s an old computer science saying that a computer should never ask you a question that it should be able to work out the answer to; a smartphone can work out much more.” The always-with-you phone can share a you-identifying phone number and tell your location via GPS, iBeacons or other location-based service. Sensors, your address book, and usage patterns can reveal more. Are you in a store? Is there a deal close by? Where are you usually at this time of day? Is there anything close by that you may be interested in? Are you sitting, walking, or running? What is the weather and traffic like where you’re headed? Who are your friends and should we contact them? Services like Apple Pay and Google Pay allow not only one-click payment, but also one-click form fill-out, making buying easier on mobile. Custom keyboards, emoji, voice input, and other methods for creative and streamlined input came first and often work better via mobile. And APIs supplied to mobile app developers may be able to reveal or request even more. The savvy innovator doesn’t lament what is lost with the desktop, they recognize all of the new that can be done in mobile and set to work building disruptive businesses.
Snapping Snapchat’s Lead with Stories
Facebook has paid close attention to rivals, and has matched certain features with aplomb. Perhaps the best example is the firm’s co-opting of Snapchat Stories—a firm that defined the category with its launch in October 2013. Facebook, Instagram, Messenger, and WhatsApp (called Statuses) all now offer time-limited, ephemeral posts, with three of them using the Stories name. Facebook put its Snapchat clone above the newsfeed in March 2017. WhatsApp Statuses launched a month earlier. Instagram Stories led this Stories onslaught the prior August. By mid-2018, Instagram and WhatsApp Story features weren’t just larger than Snapchat Stories, they were larger than all of Snapchat’s daily active user (DAU) base, and Facebook Stories were bigger than the last reported Snapchat DAU figure. Only after perfecting the feature did Facebook begin running advertising in Stories. But going a step further, Facebook has also opened Stories up to vetted third-party apps, with initial partners including Spotify, SoundCloud, Musical.ly, GoPro, selfie-editor Meitu, and Indian music app Saavn. Savvy tech strategists recognize this as a platform play—moving beyond feature and offering a service that third parties build on and make even more valuable (more on Facebook’s platform moves in the next section). Snap had once been considered a potential Facebook rival, with reports claiming that young people were “abandoning Facebook,” but rather than hitting an Instagram-like hockey-stick growth curve, Snap growth is flattening, making the firm seem like it’s following Twitter’s growth pattern, but with less social relevance. With Stories on their way to being “bigger” than feeds, Facebook’s category land-grab may be even more critical to the firm.
The dynamics of Facebook’s Story victory are important for the tech strategist. Sure Snap moved first, but Instagram, Facebook, and WhatsApp all had user-base scale and network effects (Snap initially also had a reputation for being less intuitive than its rivals). So it’s not as if Snap saw a rock solid competitive advantage eroded–instead the larger firms leveraged their competitive advantage to match and surpass an innovator, putting the bulwark of scale and network effects behind its fast-follower feature match.
Figure 11.2 Facebook’s Stories Totals on Other Platforms
Snapchat last reported DAU (daily active users) for Snapchat Stories in 2017 at less than 150 million. By the 2018 f8 conference, Facebook had announced Stories on WhatsApp (Status), Instagram, and Facebook were all larger than this. Instagram’s latest quarter had reported only 191 total users. Facebook is also turning Stories into a platform, allowing vetted apps to post directly to a Story on Facebook or Instagram.
Source: Data from F. Richter, Attack of the Clones. Statista, May 18, 2018, https://www.statista.com/chart/10558/daus-instagram-stories-whatsapp-status-snapchat/.
Big Bets: Bringing Potential Rivals and Platform Powerhouses into the Facebook Family
While mobile is different, and Facebook hasn’t always been a cross-category leader in mobile innovation, Facebook’s profitability and IPO provide the firm with cash to try to ensure that it’s Facebook that’s going to be the next Facebook. Three of the firms acquisitions, each valued at $1 billion or more, demonstrate this.
Instagram
Facebook’s dominance in photo sharing came largely from success over the Web, but photo sharing and many other activities went mobile, fast. At the time of Facebook’s IPO, Instagram, an eighteen-month-old firm with thirteen employees, had fifty million users and was adding new ones at a rate of roughly five million a week. Users loved the beautiful, artistic images Instagram’s filters created, and photos were being shared not only on Instagram but also on Facebook’s rival Twitter and other services. Analysts suggest mobile could have been Facebook’s Achilles heel—allowing Instagram to open up and become a Facebook-rivaling platform (Insta-music? Insta-links? Insta-status updates?). Facebook even acknowledged its mobile vulnerabilities in pre-IPO regulatory filings. But when Facebook acquired Instagram for a cool $1 billion, Facebook turned the potential rival into an asset for growth and another vehicle for the firm to remain central to users’ lives. Since the acquisition, Instagram has continued to operate a a separate brand, tripling its user base the year following acquisition. (and topping 800 million by mid 2018), usage numbers that dwarf Twitter and Snapchat. New features such as video were introduced, and with the introduction of ads, the app has also began to earn money.
Figure 11.3 Facebook Acquires Instagram
Instagram was acquired on the eve of Facebook’s IPO for $1 billion. Facebook maintains the app as a separate brand, and it now sports a user base far larger than Twitter or Snapchat.
Source: Image taken from Instagram’s photos published on Apple’s iTunes Store.
WhatsApp
Mobile messaging posed a bigger threat than smartphone photo sharing, so Facebook ended up writing an even bigger check. A potential acquisition of Snapchat was reported to have ended when that firm’s twenty-three-year-old founder refused a Facebook offer of $3 billion, but there was an even bigger prize out there. While less popular in the United States, WhatsApp had emerged as the global leader in mobile messaging, sending more total messages than the entire worldwide SMS text messaging standard! WhatsApp had 450 million monthly users, and a million more were signing up each day. A billion users for WhatsApp looked like a very real possibility. In the high-growth markets of India, Brazil, and Mexico, WhatsApp usage numbers were twelve to sixty-four times ahead of Facebook for mobile messaging! Seventy-two percent of WhatsApp account holders used the service each day, and collectively they shared over half a billion photos daily. While app switching costs may seem low, users were refining messaging with groups (e.g., “Family,” “Project Team,” “Running Club”), making it less likely they’d try something with fewer people that required re-creating messaging groups (network effects and switching costs strike again). Facebook began to realize that the only path to avoid being a messaging also-ran was to pony up and acquire WhatsApp, and to do it before it got any bigger. The asking price for the fifty-five person firm with zero revenue: $19 billion—$16 billion in cash, $3 billion in stock. The acquisition instantly turned co-founder Jan Koum into a billionaire, and in a rags-to-riches story, the self-taught programmer signed the deal papers on the door of the welfare office where he once collected food stamps. Nineteen billion dollars seems like an incredible amount to pay for a firm that, at least in the short term, will add nothing to Facebook’s bottom line. But this acquisition wasn’t about increasing Facebook’s total revenue; as TechCrunch stated, it was about surviving the global shift to mobile. Yes, WhatsApp lost $138 million in 2014, but by 2018 the firm was at a billion and a half MAUs (monthly active users) and growing, with Facebook only beginning to leverage the platform’s ad potential. From the perspective of securing a large user base and taking out a potentially threatening competitor, Wired labeled the Instagram and WhatsApp acquisitions as “two of the greatest bargains in recent tech history.”
Figure 11.4 WhatsApp
WhatsApp has grown to over 1.5 billion monthly active users, with fans creating chat lists and sharing video, audio, photos, and location.
Source: Retrieved from https://whatsappbrand.com/ © 2019 WhatsApp Inc.
Oculus VR
After the WhatsApp purchase, Mark Zuckerberg publicly stated: “After buying a company for $16 billion, you’re probably done for a while,” but within weeks he forked over the equivalent of two Instagrams to acquire a firm started by an eighteen-year-old that had no customers, no revenue, and no complete product. Facebook’s $2 billion purchase of Oculus VR is a long-term bet at keeping the firm at the vanguard of computing’s evolution. To the uninitiated, the first Oculus product, the Oculus Rift, looks weird. Still in prototype form at the time of acquisition, it’s essentially a computing screen that you strap to your face. Two very high-resolution displays fill ski-goggle-like gear with a wraparound image covering your field of vision. Lenses and distortion algorithms tweak computer imagery at vision periphery to hack your visual cortex and send it the kind of images it would expect to encounter in the real world. Turn your head and the image moves in real time. The Rift’s big breakthrough was that it doesn’t make you puke. Previous VR efforts had so much latency (delay) in image rendering that users would become disoriented to the point of nausea. The first versions of Oculus VR products required integration with a PC, phone, or game console, but Oculus now offers stand-alone, fully contained solutions at under $200.
Oculus was founded by Palmer Luckey, a home-schooler who hacked together prototypes in his parents’ garage in Long Beach, California. After experiencing an Oculus prototype, video game pioneer John Carmack (of Doom and Quake fame) was so impressed that he quit the firm he’d cofounded to join Oculus as CTO. Luckey launched a Kickstarter campaign to generate interest. Within hours the firm blew past its initial $250,000 goal and eventually hit $2.4 million in commitments. VCs lined up to invest. Gaming firms began working on prototypes. HBO showed an Oculus-enabled Game of Thrones experience at the South by Southwest festival. And Zuckerberg strapped on a Rift and saw the future. In a Facebook post announcing the acquisition, Zuckerberg wrote, “Imagine enjoying a courtside seat at a game, studying in a classroom of students and teachers all over the world, or consulting with a doctor face-to-face—just by putting on goggles in your home.” Justifying the acquisition, Zuckerberg has also said, “Strategically we want to start building the next major computing platform that will come after mobile.” Adds Luckey, “This isn’t about sharing pictures. This is about being able to share experiences.” While Luckey and crew might have been able to build a multibillion dollar firm on their own, many firms are circling VR, including deep-pocketed rivals with consumer experience (Samsung, Google, Sony, among them). Why sell out? Says Oculus CEO Brendan Iribe, Facebook’s resources are allowing Oculus to build product faster and better weather the onslaught of rivals. In the year since the acquisition, the firm grew its employee base fivefold, from 50 engineers to roughly 250. Facebook provides the deep pockets for developing custom, high-resolution optics hardware, VR audio (that makes it seem like sound is above or below you), and offers deep in-house technical expertise as well as the ability to leverage hundreds of thousands of Facebook servers.
Figure 11.5 Oculus Rift
Oculus Rift headset with Touch controllers.
Source: https://en.oculusbrand.com/assets/hardware
Time will tell if these acquisitions prove as strategically significant as Zuckerberg hoped. Luckey is no longer with the firm, having left after being publicly exposed for online troll-like behavior. Facebook has launched several initiatives that failed completely or did not live up to initial promise. The shuttered Poke app; yet another photo-sharing app (Moments); the underperforming Paper (news reader), Slingshot (Snapchat competitor) and Rooms (anonymous chat rooms) apps; the mostly unwanted Facebook Home smartphone platform; followed by the late-to-arrive Facebook Portal Alexa and Google Home rival; and the firm’s scuttled Gifts and Deals services are just a few examples. Buying promising innovations may be a savvy way for the now cash-rich firm to remain at the forefront of tech industry shifts.
So What’s It Take to Run This Thing?
It takes some serious hardware to serve billions. Each day, Facebook’s eleven data centers (and growing) are scattered around the planet, serving more than 2.7 billion ‘Likes,’ 350 million photo uploads, 2.5 billion status updates and check-ins, about three times the messaging volume of the SMS network (through Messenger and WhatsApp), and countless other bits of data, plus the firm crunches much of what it has collected to customize feeds, estimate which ads to serve up, and refine and improve the Facebook experience. Facebook has extraordinary data storage needs that are growing at breakneck speeds. Facebook’s storage needs have grown by a factor of 4,000 in just four years, and amount to a total storage well north of three hundred petabytes and growing at more than six hundred terabytes a day.
The Facebook cloudA collection of resources available for access over the Internet. (the big group of connected servers that power the site) is scattered across multiple facilities, including server farms in San Francisco, Santa Clara, northern Virginia, Oregon, North Carolina, Iowa, Nebraska, New Mexico, Ireland, Singapore, and Sweden. The innards that make up the bulk of Facebook’s massive multisite cloud aren’t that different from what you’d find on a high-end commodity workstation: standard hard drives and multicore Intel or AMD processors—just a whole lot of them lashed together through networking and software. Like Google and Amazon, Facebook’s servers are custom built, stripping out nonessential parts but adding in components when needed (such as massive and super-fast flash memory–based storage for some of its custom database servers).
Facebook’s “cloud brain” for artificial intelligence is also custom built. As a category-creating pioneer, Facebook can’t wait for the market to catch up with its needs, so it builds its own servers. The firm’s AI-focused servers, known internally as “Big Sur” devices, use clustered Nvidia GPUs to create a massive network for machine learning, powering all sorts of Facebook artificial intelligence tasks, including object and facial recognition, real-time text translation, and the ability to recognize and describe what’s in photos or videos. Development goals of AI include being able to accurately describe photos to blind users, and to recognize if a user is troubled and in need of mental health outreach.
Much of what powers the site is open source software (OSS)Software that is free and whose code can be accessed and potentially modified by anyone.. The service runs on the Linux operating system and Apache Web server software. A good portion of Facebook is written in PHP (a scripting language particularly well suited for website development), while some of the databases are in MySQL (a popular open source database). The firm is a major contributor to open source software efforts and was the force behind Hive, a product used to provide query support for big data projects, and Presto, another open source effort that’s even speedier than Hive. While a good portion of Facebook is written in the popular but slower-executing PHP language, the firm has written (and open sourced) a system it calls HipHop Virtual Machine, which takes PHP code and compiles (translates) it on the fly from something that a programmer can read to the machine language that a computer can more quickly execute. The object cache that holds Facebook’s frequently accessed objects is in chip-based RAM instead of on slower hard drives and is managed via an open source product called Memcache.
Other code components are written in a variety of languages, including C++, Java, Python, and Ruby, with access between these components managed by a code layer the firm calls Thrift (developed at Facebook, which was also turned over to the Apache Software Foundation). Facebook also developed its own media-serving solution, called Haystack. Haystack coughs up photos 50 percent faster than more expensive, proprietary solutions, and since it’s done in house, it saves Facebook costs that other online outlets spend on third-party content delivery networks (CDN)Systems distributed throughout the Internet (or other network) that help to improve the delivery (and hence loading) speeds of Web pages and other media, typically by spreading access across multiple sites located closer to users. Akamai is the largest CDN, helping firms like CNN and MTV quickly deliver photos, video, and other media worldwide. like Akamai. Facebook receives some 50 million requests per second, yet 95 percent of data queries can be served from a huge, distributed server cache that lives in well over fifteen terabytes of RAM.
All this technology is expensive. Facebook’s annual spend on networking equipment and infrastructure is estimated to be between $14 billion and $15 billion in 2018, up about 50 percent from the prior year and on par with Google and Apple spend. Off-the-shelf parts are cheap, but the custom AI stuff can be pricy. Nvidia high-end GPUs can go for $10,000 a piece. With users continuing to shovel data-heavy photos and video on the site (as well as through Facebook properties Instagram and WhatsApp), Facebook will likely be buying servers for years to come. And it’ll pay a pretty penny just to keep things humming. Estimates suggest the firm spends over $1 million a month on electricity and another half million a month on telecommunications bandwidth to keep your feed full and your status updated.
Want to build your own server farm like Facebook? The firm will tell you how to do it. In an unprecedented move, Facebook made public the detailed specifications of its homegrown servers (including custom power supplies, chassis, and battery backup) as well as plans used in building design and electrical and cooling systems. You can find details, photos, and video at
http://www.opencompute.org
. Facebook claims its redesigned servers are 38 percent more efficient and 24 percent cheaper than those sold by major manufacturers, and that these designs have resulted in yearly energy savings estimated at roughly $52 million, and infrastructure savings of more than $1 billion. These kinds of savings will continue to be important with Facebook, WhatsApp, and Instagram users uploading roughly one billion photos each day. Why give away the low-cost secrets? Says the firm’s director of hardware, “Facebook is successful because of the great social product, not [because] we can build low-cost infrastructure. There’s no reason we shouldn’t help others out with this.” Facebook believes sharing will improve products overall and may even attract talent to their innovation-forward shop. Does this dangerously expose a competitive advantage? Not really–Facebook’s dominance comes from the size of its user base, network effects, switching costs, and the uniqueness and applicability of its data. You could give everything but data and users to an upstart and they’d still never match the firm.
At the firm’s first f8 developers conference, Facebook published a set of APIsProgramming hooks, or guidelines, published by firms that tell other programs how to get a service to perform a task such as send or receive data. For example, Amazon.com provides APIs to let developers write their own applications and websites that can send the firm orders. (application programming interfaces) that specified how programs could be written to run within and interact with Facebook. Essentially Zuck was opening up Facebook screen real estate, user base, and features like Feed to the world’s developers. Now, any programmer could write an application that would live inside a user’s profile. Developers could charge for their wares, offer them for free, or even run ads. Facebook lets developers keep earnings through their apps (Facebook does revenue share with app vendors for some services—for example, taking 30 percent of virtual goods sales transacted through the site). Apps could be cobbled together quickly; news feeds made them spread like wildfire and the early movers saw adoption rates never before seen by small groups of software developers. And for Facebook, becoming a platform meant that each new third-party app potentially added more value and features to the site without Facebook lifting a finger (which, in a prior chapter, we learned about as value-adding complementary benefits from network effects).
There were some missteps along the way. Some applications were accused of spamming friends with invites to install them (Facebook eventually put limits on viral communication from apps). There were also security concerns, privacy leaks, and apps that violated the intellectual property of other firms (see the “Errant Apps and the Challenges of Running a Platform” sidebar), but Facebook worked to quickly remove misbehaving apps, correct errors, improve the system, and encourage developers. Just one year in, Facebook had marshaled the efforts of some 400,000 developers and entrepreneurs, 24,000 applications had been built for the platform, 140 new apps were being added each day, and 95 percent of Facebook members had installed at least one Facebook application.
The wild early success was a wild ride. Facebook eventually curtailed the vitality offered by the platform, and while many firms can credit Facebook with their success (see Spotify as a prime example), others that were continually reliant on the Facebook sharing model were hurt when app usage began to disappear from the news feed. Many developers would complain of being “Zucked over,” claiming that Facebook became a poor partner making surreptitious platform changes, altering policies without consulting them, and taking away much of the virality that helped fuel the firm’s initial app explosion. Perhaps the biggest amount of hurt accrued to once Facebook-reliant casual game firm Zynga. The firm had scrapped an earlier agreement that gave it preferred status in the Facebook news feed, and a revamp to Facebook’s feed-ranking algorithm subsequently caused a significant portion of Zynga traffic to be screened out. Zynga had once been within striking distance of becoming the world’s most valuable game company, but saw its share price plummet as its Facebook bullhorn fell silent. The shift to mobile, the inability to run Facebook apps within a Facebook mobile app, and changing expectations within the developer community have all conspired to stagnate the once-promising Facebook browser-based apps platform, but Facebook is by no means done with its platform plays.
Learning from the Cambridge Analytica Scandal: Errant Apps, Privacy Protection and the Challenges of Running a Platform
By opening its platform to third parties, Facebook exposed itself to risk, as well as value. The firm has had to deal with apps that infringe on copyright, that annoy, purvey pornography, step over the boundaries of good taste, and raise privacy and security concerns. Firms from Facebook to Apple (through its iTunes Store) have struggled to find the right mix of monitoring, protection, and approval of platform use while avoiding cries of censorship and draconian control. Platform owners beware: developers can help you grow quickly and can deliver gobs of value, but misbehaving partners can create financial loss, damage the brand, and sow mistrust. But the firm had faced nothing like the firestorm unleashed in the wake of the Cambridge Analytica scandal.
In the first half of 2018 Facebook was left reeling with the largest crisis in its history. Already suffering from public distrust from revelations that its news feed was used as a “fake news” machine, a whistleblower at a UK-based research firm, Cambridge Analytica, detailed a surreptitious campaign to harvest user data on a wide scale, develop psychographic profiles, and sell services that, as the Cambridge Analytica website claimed, will “find your voters and move them to action.”
Data was accessed, in part, from an online quiz named “ThisIsYourDigitalLife.” Sounds innocuous, right? If you haven’t taken a quiz with a goofy premise like “Which Harry Potter Character Are You?” and shared the result in your feed, then almost certainly someone else that you know has done this. In the case of “ThisIsYourDigitalLife,” only 270,000 people authorized the app to collect data, but all were told the focus was academic research and no commercial ties were disclosed. A Facebook policy (since halted) that allowed app developers to access not only information on a user, but also information on their friend’s network, accelerated data access that created working profiles on (as of this writing) some 87 million users, mostly US citizens. To underscore the issue: users were told the quiz was for academic use (data was eventually used commercially for political profiling and targeted campaign advertising), psychographic profiles were built without consent, and friends of the users—who had never even been asked if their data could be collected and shared—had all sorts of personality-identifying data vacuumed up (“likes,” demographics, and other identifying data).
The Cambridge Analytica Scandal Explained
This video explains Facebook’s Cambridge Analytica scandal.
To be fair, using data analytics for political means has been in wide use for some time. The Obama campaigns ran a much-envied machine credited with helping the one-term senator with a distinctly non-European name vault into the White House as America’s first black president. However, the Obama campaign made it very clear that all of their apps were associated with the campaign. In addition to the secret harvesting and profiling, controversy was further fueled when it was revealed that Cambridge Analytica was funded by GOP mega-donor and hedge fund billionaire Robert Mercer, and counted Trump advisor and former Breitbart head Steve Bannon as a board member. Other details alleged outreach to the firm by a Russian oil company run by a Kremlin-friendly oligarch—at this point nothing has come from this outreach, but at a time of constant headlines of a concerted Russian election influence campaign, this only fueled anger and distrust.
In the wake of of the event, the oft-repeated axiom “if you’re not paying [for an Internet service] then you are the product” became a staple of news coverage. A #DeleteFacebook campaign trended. At this point there’s little evidence that it curtailed Facebook use, and many who have left Facebook are thought to have shifted to Facebook-owned Instagram. But far more damaging is what events have done to morale at the firm—with the most notable distraught employee being Jan Koum, the billionaire co-founder of WhatsApp who resigned in protest citing Facebook’s behavior. Zuckerberg was also called before lawmakers on both sides of the Atlantic and endured several days of public grilling. Advertisers became skittish about visible partnerships with a tainted firm, Facebook has allegedly canceled plans to introduce an Alexa-rivaling smart speaker, and the investigation and resulting auditing of other partners will undoubtedly exact a financial toll.
Zuckerberg has apologized directly and repeatedly. Facebook has shut down app access to friend data, shut down 200 apps, has begun auditing “thousands” of apps that may have had access to data harvesting capabilities, notified users who have had their data compromised either directly or via friends, and introduced a host of new tools to give users greater transparency and control regarding their online privacy and data exposure. Facebook has endured previous scandals and had already been subject to government-mandated audit. But another question resulting from the incident is, Who audits the auditors? Federally mandated audits were performed by well-known “Big Four” accounting firm PwC, and the firm found Facebook’s data controls were effective at protecting user privacy—all while Cambridge Analytica was snarfing data and building profiles. Cambridge Analytica has since disbanded, but it’s unclear if additional data has escaped into the wild and if it poses continued concern to individuals and society. Keep following this case—the firm’s response to the scandal, as well as government demands and public behavior, will provide insights on preventing and dealing with crisis in the age of “Big Data.”
Zuckerberg’s Congressional Hearing on April 10, 2018
Watch Mark Zuckerberg squirm before Congress. This is an important managerial lesson highlighting what can go wrong from sloppiness, partner betrayal, and unforeseen negative consequences.
Mobile Is Tougher, But Global Players Have Big Mobile Platforms
Certain technical aspects of the smartphone ecosystem put the brakes on Facebook’s fast-paced “done is better than perfect” culture. On the Web, Facebook can test an innovation by rolling it out to a subset of users and gauging their reaction. But this so-called A/B testing is harder with mobile. Google and Apple release apps and updates to all of their users at once, so experimental feature testing with a subset of users is far more difficult to accomplish on a mobile phone. The app updating process is also usually slower than the instant “it’s here” that occurs when visiting a Web page that automatically loads the latest version on a server, making fixes for app development mistakes more challenging to distribute.
While Facebook suffered to bring its platform to mobile, it should be noted that several global messaging apps are directly accessing user address books and building their own app platforms from within iOS and Android. These include South Korea’s KakaoTalk, Japan’s Line, and most notably, China’s massive WeChat. At over 1 billion users, WeChat (owned by Shenzhen-based Tencent) is behind only WhatsApp and Facebook Messenger in messaging, but the firm’s open platform supports digital payments, shopping, gaming, banking, Uber-style taxi service, and open access to third-party developers. These aren’t just experiments: WeChat processed 460 billion transactions in 2018, that’s over 46 times more transactions than PayPal processed. One analyst says “Weixin [what WeChat is called in China] is basically the mobile Internet for China.” Food delivery startup Call-A-Chicken raised $1.6 million without a website; it doesn’t need one because it does all of its business through Weixin. It’s worth noting that profitable Tencent had 2018 revenues of $47 billion and profits of nearly 12 billion with a market cap that has fluctuated around half a trillion US dollars, numbers roughly comparable to Facebook.
What Makes Tencent Such a Goliath?
An overview of Tencent, WeChat’s parent and the world’s largest gaming company.
Source: (
S. China Morning Post via YouTube
)
Messenger: A Pillar Business Building Facebook’s Future
Zuckerberg claims messaging is “one of the few things that people actually do more than social networking,” making it a must-win for his firm. While Facebook ponied up some serious dinero for WhatsApp and Instagram, its home-grown Messenger is on a tear. Many questioned the firm’s unbundling of Messenger, splitting it as a separate stand-alone from the Facebook app, but today Messenger boasts 1.3 million users. In messaging, only WhatsApp is bigger.
To help Messenger realize its potential, Zuckerberg turned on the sales charm and did what many thought impossible: he poached the CEO of another thriving, high-growth, industry leading firm, PayPal. David Marcus left the helm of PayPal, where he led 15,000 employees to run Messenger’s group of fewer than 100 employees. Marcus ran Messenger like a separate business (not unlike Instagram, WhatsApp, or Oculus), but pulled in Facebook’s scaled-for-a-billion-users resources when needed (although he has since taken the lead of Calibra, the unit behind the new Libra cryptocurrency).
The once-scrawny Messenger has bulked up, and now includes key features of other leading messaging apps: encryption, group messaging, conversation threads, stickers, location sharing, notifications if your message has been seen, recording and sending audio messages. It’s also a Skype competitor, offering free VoIP (Voice over IP) Internet calls. Under Marcus, Messenger expanded to become a tool for corporations to communicate with customers. Firms can now use Facebook to send customer updates (receipts, shipping information), and can use Messenger for customer support chat. And the Facebook Messenger platform allows firms to build AI (artificial intelligence), powered chatbots that interact with customers using natural language and can learn from interactions and preferences over time. Early uses included gift ordering from 1-800-Flowers, ride hailing from Uber or Lyft, and requesting a news digest from CNN. Firms are finding Messenger especially attractive in the wake of Gmail segregating “Promotions and Offers” to a separate tab, a function that often hides time-sensitive communication. Such reasons may have motivated flash-sales site Zulily to sign up as one of the first firms working through Messenger. Minor League Baseball offers a chatbot for fan interaction that works in both English and Spanish. If Messenger can find that delicate balance of service but not spam, it may evolve as a critical business-to-consumer communication channel.
And taking a page from Asia’s top messaging apps, such as WeChat and Line, Facebook has introduced a platform that allows developers to build their products that integrate directly via Messenger, and has expanded Messenger as a payments platform.
Many of the lessons learned from Facebook’s browser platform, and its mobile efforts, will help shed light on how to best build new platforms, like Oculus. It’s pretty clear that Zuck is thinking beyond products to platforms as the bulwark of Facebook’s value-add and future competitive strength.
Libra: A Currency with Big Partners, and without a Country
If it realizes its goals, Facebook-backed Libra will be a decentralized, blockchain powered, government-less cryptocurrency that lowers transaction costs and enables microtransactionsSmall value transactions that are normally not viable when transaction fees, such as those in the US credit card market, are factored in. Microtransactions could include payments for public transportation, candy, or anything so small that cash is preferred. worldwide. Lots of folks refer to Libra as Facebook’s cryptocurrency, but Facebook is actually just the effort’s instigating founding member. One of the most impressive things about the effort at announcement is the group of twenty-eight initial backers who had joined the Swiss-based Libra Association. The breadth of firms offers the idea an increased legitimacy and include Visa, MasterCard, PayPal, online payment processing leader Stripe, telecom giant Vodafone, charitable NGO Mercy Corps, eBay, Uber, and Spotify. While Facebook has a key role in leading the effort, the firm will have a vote equal to other participants and anticipates that innovation and growth will come from other members, especially as the Libra association expands over time.
Part of the effort’s stated purpose is to “empower billions of people,” with a focus on creating new opportunities to serve the 1.7 billion adults worldwide who don’t have a bank account. Libras backers maintain the effort will make it both easier and cheaper to transfer money. Facebook’s efforts will be run by Marcus, the PayPal vet now head of Facebook’s regulated Libra-focused subsidiary named Calibra.
Libra will use its own separate blockchain, not one tied to Bitcoin or any other effort, and the machines that support this distributed transaction ledger will be run, at least initially, by member organizations. In order to avoid the wild fluctuations of Bitcoin and other virtual currencies, Libra will be backed by a basket of real assets including a basket of strong global currencies (think dollar and euro), plus low-risk government securities. When you buy Libra, youll do so with real currency, so that’s where many of these backing assets will come from. Some quibble that Libra doesnt meet a particular ‘pure’ definition of crypto or blockchain, but its clear this is a virtual effort without the specific backing of any government targeted at non-speculative markets using many of the technologies pioneered by Bitcoin and its kin.
Libra will be open to scrutiny by international authorities demanding controls to prevent money laundering and use to fund terrorism, but the currency hasn’t exactly received a warm embrace from governments worldwide. President Trump has criticized the currency, US lawmakers gave Calibra’s Marcus a frosty reception during a testimony, France has stated that only governments can mint money, and many European regulators have voiced concern. The Bank of England’s governor has stated that Libra might one day replace the US Dollar as a dominant global currency, while one European Central Bank board member warned against Libras “treacherous promises.” There are also concerns that as scrutiny heightens, some of the base backing the currency may lose their stomach for backing such an effort. Can Zuck transform money and transactions and build growing businesses on this new platform, or is he the exact worst poster child that will derail the effort?
Is Libra a Cryptocurrency? Facebook’s New Money Explained
A look at the new Facebook-backed, consortia-supported, blockchain-enabled cryptocurrency, Libra.
Source: (
Wired UK via YouTube
)
APIs, Playing Well with Others, and Value Added: The Success and Impact of Open Graph
While Facebook’s in-browser apps platform has stalled, and Facebook is looking to mobile and Messenger for further growth and innovation, another aspect of the Facebook platform, Facebook’s Open Graph, continues to project Facebook’s influence beyond the site itself. The initiative allows developers to link Web pages and app usage into the social graph, placing Facebook directly at the center of identity, sharing, and personalization—not only on Facebook but also across the Web. Consider some examples of what Open Graph can do.
With just a few lines of HTML code specified by Open Graph, any developer can add a Facebook “Like” button to his or her site and take advantage of the social network’s power of viral distribution. When a user clicks that page’s “Like” button, it would automatically send a link of that page to his or her news feed, where it has the potential to be seen by all of his or her friends. No additional sign-in is necessary as long as you logged into Facebook first (reinforcing Facebook’s importance as the first stop in your Internet surfing itinerary). The effort was adopted with stunning speed. Facebook’s “Like” button was served up more than one billion times across the Web in the first twenty-four hours, and over 50,000 websites signed up to add the “Like” button to their content within the first week. (Facebook now includes several new options beyond “Like” and “Message Us” buttons to launch Messenger chatbots.)
Facebook also offered a system where website operators can choose to accept a user’s Facebook credentials for logging in. Users like this because they can access content without the hurdle of creating a new account. Websites like it because with the burden of signing up out of the way, Facebook becomes an experimentation lubricant: “Oh, I can use my Facebook ID to sign in? Then let me try this out.”
Other efforts allow firms to leverage Facebook data to make their sites more personalized. Think about how this strengthens the social graph. While items in the news feed might quickly scroll away and disappear, that data can now be pulled up within a website, providing insight from friends when and where you’re likely to want it most. Facebook’s opening of the “Stories” feature to third parties, effectively creating a platform from a product well ahead of one-time now laggard Stories leader Snapchat (see prior section) is another example of Facebook’s relentless drive to build and strengthen its platforms.
When taken together, these features enlist websites to serve as vassal states in the Facebook empire. Each of these ties makes Facebook membership more valuable by enhancing network effects, strengthening switching costs, and creating larger sets of highly personalized data to leverage.
Strategic Concerns for Platform Builders: Asset Strength, Free Riders, and Security
Facebook also allows third-party developers to create all sorts of apps to access Facebook data. Facebook feeds are now streaming through these devices: Samsung, Vizio, and Sony smart televisions; Xbox and Nintendo game consoles; Verizon’s FiOS pay-television service; the Ford Sync auto platform, and the Amazon Kindle. While Facebook might never have the time or resources to create apps that put its service on every gadget on the market, they don’t need to. Developers using Facebook’s access tools will gladly pick up the slack.
But there are major challenges with a more open approach—most notably, a weakening of strategic assets, revenue sharing, and security. First, let’s discuss the potential for weakened assets. Mark Zuckerberg’s geeks have worked hard to make their site the top choice for most of the world’s social networkers and social network application developers. Right now, everyone goes to Facebook because everyone else is on Facebook. But Facebook, or any firm that opens up access to users and content, risks supporting efforts that undermine the critical assets of network effects and switching costs. If you can get Facebook content on other sites, why go to Facebook?
Related to asset weakening is the issue of revenue sharing. Hosting content (especially photos and rich media) is a very expensive proposition. What incentive does a site have to store data if it will just be sent to a third-party site that will run ads around this content and not share the take? Too much data portability presents a free rider problemWhen others take advantage of a user or service without providing any sort of reciprocal benefit. in which firms mooch off of Facebook’s infrastructure without offering much in return. As an example of this tension, Facebook and Twitter, firms once known for their openness, have erected walls to make it more difficult for users to integrate their services. Twitter users used to be able to click on an Instagram photo and have it displayed directly in the Twitter app or in a pop-up window in Twitter-owned TweetDeck, but doing so prevents Facebook from wrapping Instagram content in messages, collecting “Likes,” and—although it doesn’t currently do so—running ads. Instagram also blocked user ability to find friends on Twitter.
Finally, consider security. Allowing data streams that contain potentially private posts and photographs to flow through the Internet and have them land where you want them raises all sorts of concerns. What’s to say an errant line of code doesn’t provide a back door to your address book or friends list, to your messaging account, or to photos you’d hoped to only share with family? Security breaches can occur on any site, but once the data is allowed to flow freely, every site with access is, for hackers, the equivalent of a potential door to open or window to crawl through.
Facebook’s increasing dominance, long reach, and widening ambition have a lot of people worried, including the creator of the World Wide Web. Sir Tim Berners-Lee has warned that the Web may be endangered by Facebook’s colossal walled gardenA closed network or single set of services controlled by one dominant firm.. The fear is that if increasingly large parts of the Web reside inside a single (and, for the most part, closed) service, innovation, competition, and exchange may suffer. In the wake of the Cambridge Analytica scandal, some have even called for Facebook to be broken up.
If Facebook is going to continue to grow and give away its services for free, it needs to make money somehow. Right now the bulk of revenue comes from advertising. Fortunately for the firm, online advertising is hot. For years, online advertising has been the only major media category that has seen an increase in spending (see
Chapter 18 “Google in Three Parts: Search, Online Advertising, and an Alphabet of Opportunity”
). Firms spend more advertising online than they do on radio, magazine, cable television, or newspaper ads. But not all Internet advertising is created equal. For Facebook, the size of the firm’s market has created a money-gushing bonanza, but one that is very different than Google’s offering. Social has its challenges and we’ll dive deeper into what’s different, what’s tougher, what’s being tried, and what’s working.
First a look at what’s different about search advertising and social ads. Firms face two key challenges when advertising on social media: content adjacencyConcern that an advertisement will run near offensive material, embarrassing an advertiser and/or degrading their products or brands. and user attention.
Content Adjacency Challenges: Do You Really Want Your Brand Next to That?
The content adjacency problem refers to concern over where a firm’s advertisements will run. Consider all of the questionable titles in social networking groups. Do advertisers really want their ads running alongside conversations that are racy, offensive, illegal, or that may even mock their products? This potential juxtaposition is a major problem with any site offering ads adjacent to free-form social media. Summing up industry wariness, one Procter & Gamble manager said, “What in heaven’s name made you think you could monetize the [screen] real estate in which somebody is breaking up with their girlfriend?”
The issue of content adjacency came to a head when Facebook saw several blue-chip advertisers, including the UK media giant BSkyB and retail behemoth Marks & Spencer, pull their ads after they ran on a sexually themed Facebook page that may also have contained photos of minors. Another campaign, led by several groups raising awareness of online hate speech and misogynistic content, resulted in tens of thousands of tweets and thousands of e-mails sent to firms whose advertisements were showing up next to “particularly vile content.” These crises caused Facebook to update its guidelines on hate speech; improve training for complaint reviewers; work more closely with groups concerned about hateful, graphic content on the social network; and restrict ads from appearing next to pages and groups that contain violent, graphic, or sexual content. An IDC report suggests that it’s because of content adjacency that “brand advertisers largely consider user-generated content as low-quality, brand-unsafe inventory” for running ads. Dispelling concerns hinges on a combination of evolving public attitudes toward content adjacency issues in social media, as well as better technology and policing of the context in which ads appear.
Attention Challenges: The Hunt versus the Hike
Google and other search sites are on a hunt—a task-oriented expedition to collect information that will drive a specific action. Search users are expressing intent in search. They want to learn something, buy something, research a problem, or get a question answered. To the extent that the hunt overlaps with ads, it works. Just searched on a medical term? Google will show you an ad from a drug company. Looking for a toy? You’ll see Google ads from eBay sellers and other online shops. Even better, Google only charges text advertisers when a user clicks through. No clicks? The ad runs at no cost to the advertiser. From a return on investment perspective, this is extraordinarily efficient.
While users go to Google to hunt, they go to Facebook as if they were going on a hike—they have a rough idea of what they’ll encounter, but this often lacks the easy-to-monetize, directed intent of search. They’re there to explore and look around and enjoy the sights (or site). They’ve usually allocated time for fun, and they don’t want to leave the terrain when they’re having conversations, looking at photos or videos, and checking out updates from friends. You’ll likely never go to Facebook to look for a plumber or search out a specific product.
That doesn’t mean Facebook isn’t a place to advertise, but it does mean it will appear to a different set of advertisers with different goals. Many of the ads you’ll see on Facebook and related properties are for discovery or awareness building rather than a stated intent to purchase. Are you a pet owner? You’ve almost certainly seen ads for new pet products, even though you haven’t been actively shopping for these on Facebook. Style conscious? Facebook has a good idea on what types of clothing and beauty products you may be interested in. Linger on an ad or click to explore an offer and Facebook gets even more info on what you’re likely to be interested in. My feeds across Facebook properties are a tightly-targeted mix that’s heavy on electronics, robotics, maker-equipment, and travel—all things I’m most likely to respond to.
Facebook Ads: The Massive Potential Upside Is Realized
Worries over Facebook’s ad model were underscored when growth slowed in the two quarters prior to the firm’s IPO and many questioned the firm’s ability to successfully monetize mobile, temporarily driving the stock below issue price. Despite these concerns, Facebook’s performance has silenced skeptics. 2018 revenue and profits both grew by just under 40 percent. Facebook’s ability to better manage supply and demand to improve pricing, leverage data for targeting, and create lucrative new ad products and formats have kept growth engines oiled and fueled for expansion. And no one doubts Facebook’s mobile ad muscle now that mobile brings in more than 90 percent of the firm’s ad revenue. While at IPO Facebook made no money from mobile, today Facebook’s money is nearly all from mobile.
Precise Targeting
First is the advertising appeal of precise targeting. Large advertising networks have tried to meticulously track users to develop a profile of their demographics, likes, and interests. Facebook knows all about you because you’ve told it the details—your age, the things you’re enthusiastic about, where you live, your relationship status. This opens up all sorts of targeting opportunities to even the smallest of advertisers. In one example, a wedding photography studio targeted ads at women aged twenty-four to thirty whose relationship status was engaged—that’s like sticking a flyer in front of precisely everyone you want to reach and not wasting a dime on anyone else. The firm, CM Photographics, reports that just $600 in Facebook ads resulted in nearly $40,000 in revenue.
While Facebook has gotten even more accurate at ad targeting, its relentless string of privacy gaffes, increased public outcry, and a tightening regulatory envionrment have prompted the firm to halt a five year partnership with third-party data aggregators that gave the firm access to additional data such as offline purchases and loyalty program participation. It had previously worked with many of the data aggregators listed in the Data and Competitive Advantage chapter, including Axciom, Datalogix, and Epsilon, but the effort has now been permanently halted. The move also came at a time when regulations, such as the European Union’s General Data Protection Regulations (GDPR), which requires firms operating in Europe to disclose data collection (think the now ubiquitous “Our site monitors you with a cookie” warning), and provides requirements for correction, deletion, and limiting the ability of firms to transfer EU citizen data outside of its borders.
Facebook, Help Get Me a Job!
The news is filled with stories about employers scouring Facebook to screen potential hires. But one creative job seeker turned the tables and used Facebook to make it easier for firms to find him. Recent MBA graduate Eric Barker, a talented former screenwriter with experience in the film and gaming industries, bought ads promoting himself on Facebook, setting them up to run only on the screens of users identified as coming from firms he’d like to work for. In this way, someone Facebook identified as being from Microsoft would see an ad from Eric declaring “I want to be at Microsoft” along with an offer to click and learn more. The cost to run the ads was usually less than $5 a day. Said Barker, “I could control my bid price and set a cap on my daily spend. Starbucks put a bigger dent in my wallet than promoting myself online.” The ads got tens of thousands of impressions and hundreds of clicks, and dozens of people called offering assistance. Today, Eric Barker is gainfully employed at a “dream job” in the video game industry.
Figure 11.6 Self-Advertising on Facebook
Eric Barker used Facebook to advertise himself to prospective employers.
Source: Facebook.
Mobile Revenue on the Upswing
Also despite concerns about mobile advertising, the story seems to be getting better. As of the first quarter of 2016, over 90 percent of Facebooks monthly active users (MAUs) visited using mobile devices, and over half only access using mobile. By cracking the mobile ad code, Facebook has also been able to earn more from its global audience, with more than half of all ad dollars now coming from outside the US. Mobile users provide Facebook with a steadier flow of customer interaction throughout the day. One survey found that the average smartphone user checks Facebook fourteen times a day and that most check their phones immediately after waking up in the morning. As for upside, also consider that Instagram only began running ads in November 2013, and as of this writing, WhatsApp only recently began running a modest number of ads. That leaves a lot of room for new ad growth, with the possibility of even more as Stories becomes a platform for serving third-party content on Facebook. Results in Facebook mobile suggest the firm understands how to run mobile ads without excessively annoying users.
Ads in Feeds: Better Performance Even as Fewer Ads Are Shown
Facebook was initially reluctant to place ads in the news feed, but such ads have proven to be hugely successful for the firm and pretty much dispelled earlier concerns over “the hike” at Facebook being a poor ad platform. Unlike search ads, ads in the news feed move beyond the easy-to-ignore real estate on the right side of the desktop and instead put a message right in the middle of the exact screen real estate that a user is paying attention to. News feed ads have been shown to deliver a twenty-six times higher return on investment than sidebar ads. And news feed ads are evolving with new video ad offerings. One survey found that more people age eighteen to twenty-four access Facebook during evening primetime hours than watch ABC, CBS, NBC, and Fox combined. Advertisers that are losing audience reach in declining primetime numbers are likely to shift more ad dollars to channels where desirable demographics are spending more time. Ads on Facebook carry an average CPMCost per thousand impressions—the amount charged every time an ad appears 1,000 times (M is the roman numeral for 1,000). of over $11, a value that has been steadily growing. Note: CPM stands for cost per thousand impressions—a common way to express advertising rates which refers to the amount charged every time an ad appears 1,000 times (M is the roman numeral for 1,000). And in a further bid to go after YouTube, Facebook has begun sharing 55 percent of ad revenue with digital content creators. While the rate is similar to YouTube’s, Facebook has the added advantage of putting content in front of users (via the feed) who might not normally get exposed to it.
Beyond “Right Margin” Display Ads: Big, New Winners Emerge
Facebook allows advertisers to enhance ads with “social context,” showing the names of friends who have “liked” the firm or checked-in to advertiser locations. These ads attempt to take advantage of the concept of social proof—adding legitimacy for a product through its association with your friends. Ads with social context have been shown to perform better (e.g., a 50 percent greater likelihood of higher recall and 35 percent sales lift), so Facebook has baked opportunities for social ads into its ad products. Various ad types focus further on a desired outcome (like a page, sign up for an event, request more information, shop, engage with a post, etc.). Such ads play to Facebook’s social and data strength, and offer additional targeting that should improve ad quality for its users (a significant problem in Facebook’s earlier ad products).
An Ad Network for Facebook. Can It Best Google?
Ad revenue is also likely to increase now that tweaks in Facebook’s news feed post-selection algorithm are limiting the reach of organic posts from firm fan pages.
Posts from fan pages used to be a free promotion source for any organization hoping to reach the news feeds of those who “liked” their product. While posts have long been curated by Facebook algorithms, such posts used to reach about 16 percent of a page’s fans. Sources report that organic reach from fan posts has dropped to a range from 6.15 percent to as low as 2 percent. While disappointing to marketers who have worked hard to cultivate a fan base on Facebook, it can’t come as a surprise that Facebook would one day limit the free ride on its service and attempt to commercialize fan pages by promoting post reach. Among the many ad products Facebook offers are “Promoted Posts,” which increase the reach of an item that a firm shares. Expect firms with a substantial Facebook following, especially those that have seen solid results from past campaigns, to boost their advertising as a result.
More upside potential comes from Facebook’s advertising network. Google earns about 20 percent of its revenue from ads it runs on third-party sites (referred to as the Google’s ad network). Next time you search the Web, look for advertisements labeled “Ads by Google.” Google serves up these ads and splits the take with website operators. Up until mid-2014, Facebook only ran ads within Facebook properties, but with the launch of the Facebook Audience Network, the firm can make money off its billion-plus users, even when they’re not on Facebook’s own sites and apps. Mobile app developers can, too. All developers need to do is put a snippet of Facebook code into their apps. Zuckerberg’s firm will line up advertisers, select and run targeted ads based on its massive knowledge of individual users and user preferences, measure ad performance, and collect payments to forward on to its partners (after taking a cut, of course). While your Facebook data will be used to target ads outside the service, the firm’s ad network doesn’t give advertisers or publishers any personal data, it simply performs matching on its own servers, then delivers the appropriately targeted ad to the app. And users can opt-out of any ad tracking, as well. Some think that a Facebook ad network might be able to offer ad targeting that performs better than Google’s AdSense product. Google targets ads on other websites based largely on keywords found on those sites, also using details it can glean from tracking a person’s Web browsing history (see
Chapter 18 “Google in Three Parts: Search, Online Advertising, and an Alphabet of Opportunity”
for details). Facebook can do all this, but it could also add in all sorts of data from the dark Web that Google can’t see: data from a user’s social activity, their highly accurate personal profile, and more. As an added bonus, Facebook can use its ad network to boost revenue without increasing the density of ads in its own products—another win for usability.
Content Providers, Step Deeper Inside My Walled Garden
Facebook has also offered to host and serve content on its own servers. The “Instant Articles” service helps vendors overcome the problem of slow page loads and content that’s poorly formatted for mobile. Articles usually take an average of eight seconds to load, often enough to prompt users to quit, and causing content providers to miss out on the ad revenue from a page view. Caching articles on Facebook’s servers allows pages to load ten times faster, and articles are precisely formatted for display on a user’s mobile device, even offering special formats like maps, zoomable photos, and video. Publishers have the option to fill their ad inventory themselves and keep all of the ad revenue (Facebook does have some guidelines on the format of ads that can be displayed), but the Facebook Audience Network will gladly line up advertisers for any unsold inventory the firm wants to make available, for a 30 percent cut for Zuck. Clicks will be recorded by comScore, reflecting traffic as if users visited a firm’s site, and shared links will also refer back to a website rather than to the article cached on Facebook. Initial big media partners included The New York Times, BuzzFeed, The Atlantic, The Guardian, NBC News, and National Geographic, but Facebook has since opened the platform up to all publishers. Facebook says it doesn’t play favorites with “Instant Article” partners, but as TechCrunch speculates: “The animated Instant Article covers are certainly more eye-catching than traditional static blurbs, and those clicks tell the feed to show a story to more people.” Video on Facebook is booming and presents yet another content serving (and ad sales) opportunity that Facebook can develop and exploit. Facebook serves as many clips as YouTube in part because it’s handled so well. Sound-off clips cut the annoyance while piquing interest, making the feed look “like a Harry Potter newspaper come to life.”
Some worry “Instant Articles” reinforce Facebook’s walled garden and give the firm even more power over how journalism is distributed and seen, but if Facebook can placate concerns and deliver value to partners, it may be able to convince more to allow its ad network to serve ads on their content, as well. Look for more evolution as Facebook tries to match news efforts from Apple News and Google as a way to satisfy consumers, increase customer interaction, sell more ads, and battle fake news.
Better Advertisement Everywhere. What’s Up Next?
As for more speculative opportunities for ad market growth, consider the longer-term possibilities for social television. Facebook almost certainly wants to play a starring role in your living room, making the TV a platform for social activity: video chat, serving targeted ads, social entertainment recommendations, games, and all sorts of commerce. It will be tough to navigate the tensions of bandwidth-capping cable guys, channel owners, and hardware firms keen to build their own platform, but Zuckerberg has Reed Hastings on his board. No one has built a further-reaching platform with consumer electronics firms than the Netflix CEO, and he should provide keen insight as Facebook spreads further. And don’t count out Oculus. Those court-side immersive experiences Zuckerberg imagined would go great with deeply engaging ads, as well.
Facebook continues to refine its ad offerings, targeting, and reach potential, and the recent and continued surge in ad growth suggests that the firm’s advertising customers are mostly satisfied and coming back for more. It’s also worth noting that big advertisers aren’t the only ones Facebook (and rivals) are after. Zuckerberg’s firm has been used by over one million different advertisers, and many of these are small businesses using the firm’s self-service ad platform. Results-focused offerings for these clients, many of whom increasingly view a Facebook presence as being as important or more important than a standard Web page, bode well for future revenue growth. With more than half of Facebook’s revenue coming from outside the United States rising worldwide mobile engagement and a growing middle class in many emerging markets where Facebook operates point to revenue forecasts that suggest the continued trajectory of up and to the right.
The Hidden Ways Facebook Ads Target You
This video from Vice shows various tools in user targeting, and also uncovers workarounds and algorithmic abuse. The video also briefly mentions fake news, which is covered in the next section.
Transcript
Key Takeaways
· Issues of content adjacency and user attention can make social networking ads less attractive than ads running alongside search and professionally produced content sites.
· Google benefits from much of its advertising being associated with intent-to-purchase. Users are on a “hunt” to find information when they enter Google, and ads can be seen as quite helpful. Facebook users are not necessarily seeking anything related to purchase.
· Display ads and video ads are often charged based on impression.
· Facebook ads can be precisely targeted since the firm has a large amount of actual data on users’ self-expressed likes, interests, and demographics. Facebook has also taken steps to allow third-party databases to be incorporated into targeting ads on site while preventing the possibility that databases can be combined to reveal online information to offline partners or vice versa.
· Mobile traffic is growing, and despite initial concerns over Facebook’s ability to find growth in this space, the firm’s mobile ads in particular have grown at a tremendous rate and are solidly profitable.
· Ads in the news feed have the advantage of falling directly within the screen real estate that a consumer is focused on. As such, they are considered superior to ads that may occupy easy-to-ignore spaces on the right-hand side of a content window.
· Facebook has cut the number of ads it shows its users, and the scarcity this builds, along with better targeting, has allowed the firm to charge more. This has improved the user experience while improving profits.
· “Social Context” ads, which include the names of friends who have liked a firm’s page, perform better on recall and sales lift than conventional ads, enhancing Facebook’s advertising appeal. These ads also use a type of “social proof,” leveraging friend interest to improve the likelihood of customer engagement.
· Facebook has also found success in mobile install ads. Some gaming firms are willing to spend as much as $10 per install for these ads.
· The Facebook Audience Network provides a way for firms to allow Facebook to gather advertisers, target and serve ads on third-party sites and apps, and collect revenue for them.
· “Instant Articles” allow Facebook to host, cache, and serve content from media firms. Faster article loads should increase article engagement and allow partners to make more money. Facebook hopes partners may be more inclined to use its ad network, as well. Video ads cached and served on Facebook are also booming, with Facebook serving as many videos a day as YouTube.
· Some are concerned that allowing Facebook to host and serve content reinforces Facebook’s walled garden, where users rarely venture out, and where Facebook grows even more powerful as a vital partner in content distribution.
The road around Facebook’s campus is named “Hacker Way,” and concrete letters in the firm’s central courtyard spell the word “HACK” (the term used by software engineers to refer to a clever solution, rather than the negative connotation used in security circles). Graffiti-laden walls underscore that Facebook is a creative and edgy place, and slogans like “Done is Better than Perfect” and “Move Fast, Break Things” are cultural signposts that direct staff to keep an eye on what has helped make the firm successful. This is, after all, a business built on network effects, and in Facebook’s world, it’s either be quick or be dead. And yes, sometimes things break. A mistake by one engineer once accidentally released all of Facebook’s top-secret projects. Oops! While the firm does strive to reduce errors, and Zuck has shifted slightly (crowing the less catchy “move fast with stable infrastructure”), Facebook’s “no-beta” culture tolerates mistakes on the road to progress. Even new hires in the firm’s engineering boot camp work hands-on with the actual site. Code changes are rolled out to progressively larger groups so that user reaction and major bugs can be dealt with, but well-received updates can make it out to over a billion users within hours. The willingness to take bold risks on new initiatives has allowed the firm to push forward with innovations that many users initially resisted but eventually embraced (e.g., the news feed, the messenger app). But moving fast with less forethought has also led to alienating gaffes that have damaged the firm’s reputation. By examining some of Facebook’s mistakes, managers can raise their internal awareness of pitfalls associated with implementing technology initiatives, and by watching Facebook’s responses to missteps, managers can gain insight into effective course correction if initial efforts run into trouble.
Figure 11.7 Inspirational Signs at Facebook Headquarters Campus
Facebook’s campus is full of signs and slogans to reinforce the firm’s risk-taking, move-fast, hacker-centric culture.
Source: John Gallaugher
Got a Great Team? Break ’Em Up and Spread ’Em Around!
Building such a great infrastructure requires a super-smart and super-creative talent base. In order to keep the ideas humming, Facebook regularly rotates technical staff. Every eighteen months employees are required to leave their teams and work on something different for at least a month. Getting people into new groups helps the firm’s geniuses more broadly share their knowledge, generates idea flow, and prevents managers from developing fiefdoms. The firm also runs legendary hackathons, all-night sessions with one key rule: no one is allowed to work on what they normally do. Engineers blue-sky innovate on something new and show it to Zuckerberg and a senior staff brain trust, who then decide which projects go forward.
Beacon Busted—Management Lessons on Tech Planning and Deployment
The launch, public outcry, resulting PR disaster, and eventual repeal of Facebook’s highly touted “Beacon” platform provide a lesson for managers regarding the peril in introducing system modifications without considering their full implications. For all of Facebook’s high-speed, innovation-fueled growth, moving fast does have a downside when things break.
The Beacon effort started from a simple question: Could the energy and virulent nature of social networks be harnessed to offer truly useful consumer information to its users? Word of mouth is considered the most persuasive (and valuable) form of marketing, and Facebook was a giant word-of-mouth machine. What if the firm worked with vendors and grabbed consumer activity at the point of purchase to put it into the news feed and post it to a user’s profile? If you watched a video, bought a cool product, or dropped something in your wish list, your buddies could get a heads-up, and they might ask you about it. The person being asked feels like an expert, the person with the question gets a frank opinion, and the vendor providing the data just might get another sale. The effort, named Facebook Beacon, looked like a home run. Some forty e-commerce sites signed up, including Fandango, eBay, Blockbuster, Travelocity, Zappos, and the New York Times. Zuckerberg was so confident of the effort that he stood before a group of Madison Avenue ad executives and declared that Beacon would represent a “once-in-a-hundred-years” fundamental change in the way media works.
User reaction to Beacon was swift and brutal. The commercial activity of Facebook users began showing up without their consent. The biggest problem with Beacon was that it was “opt-out” instead of “opt-in.” Facebook (and its partners) assumed users would agree to sharing data in their feeds. A pop-up box did appear briefly on most sites supporting Beacon, but it disappeared after a few seconds. Many users, blind to these sorts of alerts, either clicked through or ignored the warnings. And, well, there are some purchases you might not want to broadcast to the world.
“Facebook Ruins Christmas for Everyone!” screamed one headline from MSNBC.com. Another, from U.S. News and World Report, read “How Facebook Stole Christmas.” The Washington Post ran the story of Sean Lane, a twenty-eight-year-old tech support worker from Waltham, Massachusetts, who got a message from his wife just two hours after he bought a ring on Overstock.com. “Who is this ring for?” she wanted to know. Facebook had posted a feed not only that her husband had bought the ring but also that he got it for a 51 percent discount—making him look cheap!
Overstock.com quickly announced that it was halting participation in Beacon until Facebook changed its practice to opt in. MoveOn.org started a Facebook group and online petition protesting Beacon. The Center for Digital Democracy and the US Public Interest Research Group asked the Federal Trade Commission to investigate Facebook’s advertising programs. And a Dallas woman sued Blockbuster for violating the Video Privacy Protection Act (a 1998 US law prohibiting unauthorized access to video store rental records).
Zuckerberg would later say regarding Beacon, “We’ve made a lot of mistakes building this feature, but we’ve made even more with how we’ve handled them. We simply did a bad job with this release, and I apologize for it.” Beacon was eventually shut down, and $9.5 million was donated to various privacy groups as part of its legal settlement. There’s not much evidence that Beacon’s failure had any notable impact on Facebook’s growth. But perhaps a bigger problem was that many of those forty A-list e-commerce sites that took a gamble with Facebook now had their names associated with a privacy screw-up that made headlines worldwide. Not a good thing for one’s career. A manager so burned isn’t likely to sign up first for the next round of experimentation.
From the Prada example in Chapter 3 “Zara: Fast Fashion from Savvy Systems” we learned that savvy managers look beyond technology and consider complete information systems—not just the hardware and software of technology but also the interactions among the data, people, and procedures that make up (and are impacted by) information systems. Beacon’s failure is a cautionary tale of what can go wrong if users fail to broadly consider the impact and implications of an information system on all those it can touch. Technology’s reach is often farther, wider, and more significantly impactful than we originally expect.
Faked Out by Fake News
There are countless stories of the Facebook platform being used for good: happy reunions, life-saving connections, organizing for positive change, and of course, as a vehicle that helps entrepreneurs worldwide to uncover customers and thrive. But technology has no built-in morality, and tools to connect can become tools for abuse. The extent to which so-called “fake news” on Facebook has been used to fan the flames of political discord has been astonishing, troubling, and has caused a deep, existential crisis within the firm, its user base, management, and society. There can also be an immediate physical danger from the spread of Fake News—for example, the widely shared #PizzaGate story claimed a Washington, DC, restaurant was a front for a Hillary Clinton-associated child sex trafficking ring involving children kept in a basement. One man, intent on exposing this alleged crime, traveled to and opened fire at the storefront, which didn’t even have a basement.
Facebook’s fake news exploiters have different motivations. For example, there are the hard-partying Macedonian teens who couldn’t care less won the US presidential election, but bought ads as well as hacked Facebook profiles, and used these to share sensationalist stories. The idea—get people fired up to spread this content virally. Anyone who clicks through to view the fake news site is lining the teens pockets, since these sites make money by running ads served by ad networks, such as Google’s. The small Macedonian town of Veles (25 percent unemployment, once known as “the second most polluted city in Yugoslavia) has been identified as hosting 150 fake news sites that garnered 40 million page views in six months, netting tens of thousands of dollars in profit from peddling outrage to duped Americans. One teen made so much money that he quit high school to work full time on the effort. Ad targeting—good for finding a Christmas gift or vacation spot, and also good for inciting the angry to follow your click-bait.
Fake News
How a Hard-Partying Macedonian Teen Earns Thousands Publishing Lies
Even more troubling is the highly sophisticated campaign allegedly undertaken by agents acting on behalf of the Russian government. Much of this was led by the innocuously named “Internet Research Agency,” a fake-news farm in St. Petersburg, Russia. Facebook has stated that as many as 150 million Americans may have been exposed to these messages over Facebook and Instagram in the time leading up to the 2016 US presidential election. An analysis by BuzzFeed showed that the top 20 fake news stories had more shares, reactions, and comments on Facebook than the top twenty news stories from reputable sites. In 2018, the US Justice Department indicted 13 Russians and three companies for using social media to subvert the 2016 election and push voters toward Donald Trump. While other social media sites were mentioned, Facebook and its properties were singled out far more than any other tech firms.
Facebook didn’t help its credibility in the months leading up to the indictment. Zuckerberg originally dismissed the notion that Facebook played a role in tipping the election as a “crazy idea”; he later declared he regretted his original statements and attitude. Facebook’s initial estimate of the number of fake news accounts (only eighteen million) was far less than the over two billion fake accounts it would eventually disable and remove. As more details were revealed and Zuck was dragged before lawmakers on both sides of the Atlantic, many questioned why Facebook wasn’t able to identify, catch, and disrupt this activity while it was happening. The firm had an active mechanism in place to stop ad fraud and curtail posts with pornography and violence. Wouldn’t the patterns of fake news be easy to recognize and stop? Recode asked why the people who “build their own Internet beaming drones . . . aren’t smart enough to figure out the difference between the New York Times and the Denver Guardian, which doesn’t actually exist.” And the media buys were not what most would call a small campaign. The Russians were spending upwards of $1.25 million a month on these ads. Some wondered if Facebook turned a blind eye because it was making money from the Russian ads. And apparently it wasn’t limited to the US election, either. Election-tampering accusations have been leveled against Russians sowing discord in the Brexit vote, the Scottish Independence referendum, and elections in France and the Netherlands, and additional fears given forthcoming elections in Mexico, Columbia, Brazil, Sweden, and other nations.
Facebook had announced or undertaken a multipronged approach to battling fake news, but this is an admittedly difficult task. How do you police a platform that can be accessed by a quarter of the planet at any given time? And how do you bless one media outlet over another while balancing expectations of free speech and unbiased presentation? An early Facebook solution randomly surveyed users on the reputability of a news source and put red flags next to questionable content. What happened? Users who found the fake news reinforced their own political views actually shared red flagged stories even more than the real stuff. Facebook has also partnered with independent fact-checking organizations (Snopes, Politifact, ABC News, and FactCheck.org, with Facebook committing to expanding partners over time), but has since expanded to more than twenty, worldwide. All are members of the Poynter International Fact Checking Network, and have agreed to a common set of principles. If at least two of the fact-checkers identify the post as a fake, Facebook will shrink the size of the article, follow the post with links debunking the claim, and downrank posts so that they are buried deep within in a user’s news feed. If a user still clicks on the disputed article, a popup box warning “Disputed by 3rd Parties” displays first, allowing the user to continue or cancel their click-through. Any articles identified as fake will also be banned from using Facebook’s advertising and promotional products, and Facebook will drop any ads from websites that run such ads or that appear to trick the user into thinking they are real (e.g., abcnews.com.co or buzzfeedfeed.com—catch the differences?). An icon accompanying some posts will allow the user to get additional information about that news source. Facebook has also increased screening for bogus accounts, and it screens ads for similarities with already banned content. For postings that aren’t clearly from a news or fake news site, Facebook will ask employees to screen whether or not the content is a personal post, with personal content not being subject to the “fake news” flags and penalties. Users can also flag a post as fake news for possible fact-checker screening. Facebook uses technology to identify behavior associated with a possible fake article (e.g., articles that are frequently deleted after posting, articles that have consistent comments declaring they are “fake”). The firm is also using reverse image search to see if an image has been doctored. Many images also carry “meta data” added by the phone or camera that took the photo (e.g., time, date, geolocation), and comparing images with the same meta data but alterations in a portion of their content can also surface Photoshopped fakes. Machine learning will be used to focus the fake-finding over time, but AI has its limits. Figures released by Facebook showed its AI had a 100 percent success rate at detecting spam, it could detect both terrorist propaganda and fake accounts 99.5 percent of the time, and adult nudity and sexual activity at a 95.8 percent rate. But AI found hate speech only 38 percent of the time. Efforts such as the firm’s Fighting Abuse @Scale conference bring together some of the best minds concerned about this issue and who are tackling similar problems, but this isn’t something with a single, long-term solution.
Facebook’s Fight Against Misinformation
Hear Facebook employees discussing the challenges of fake news, respecting free speech, and battling bad actors. Technology used in the fight is also demonstrated.
Facebook’s initial reaction to the fake news controversy, its initial stumbles, and its enduring efforts to curtail the problem highlight challenges faced by firms offering services that can be used for good or ill. While Facebook has endured past privacy gaffes and has continued to grow through controversies, the attention and criticism the firm has faced over fake news has been relentless and the most severe it has faced to date. Managers will learn quite a bit by watching how Facebook continues to follow up, which efforts work or fail, and how governments, users, employees, and business partners react to these developments.
Challenges of Going Global: Low ARPUs, Legitimate Rivals, and Unreachable Users
With most of its revenue coming from outside the United States, Facebook is already massively global. Facebook’s crowdsourcingThe act of taking a job traditionally performed by a designated agent (usually an employee) and outsourcing it to an undefined, generally large group of people in the form of an open call.localizationAdapting products and services for different languages and regional differences. effort, where users were asked to look at Facebook phrases and offer translation suggestions for their local language, helped the firm rapidly deploy versions in dozens of markets, blasting the firm past one-time rivals in global reach. But network effects are both quick and powerful, and late market entry can doom a business reliant on the positive feedback loop of a growing user base. And global competition is out there. Facebook wannabes worldwide include VKontakte (“in contact”), Russia’s most popular social networking site; Line, the app and platform which is tops in Japan and has a large following in many other countries; and Qzone and WeChat (both owned by Tencent), which are wildly popular in China. And don’t be surprised to see some of these well-capitalized overseas innovators making a move on US markets too. China’s Tencent and Japan’s Rakuten are among non-US firms that have acquired US-based Internet firms.
Figure 11.8 Facebook’s Average Revenue per User
Source: Data from Facebook Year End 2018 Financial Results Presentation
While global growth can seem like a good thing, acquiring global users isn’t the same as making money from them. Free sites with large amounts of users from developing nations face real cost or revenue challenges. As the New York Times points out, fewer than half of global Internet users have disposable incomes high enough to interest major advertisers, meaning that in terms of average revenue per user (ARPU), these new social networking recruits are likely to be far less lucrative in the near future than the firm’s current users. In the last quarter of 2018, the average user in the United States and Canada was worth $34.86, but in Europe that figure was only $10.98, Asia-Pacific ARPU was $2.96, and in the rest of the world, ARPU was $2.11.
Making money in the face of this so-called international paradox requires an awareness of fast-and-cheap tech trends highlighted in Chapter 5 “Moores Law and More: Fast, Cheap Computing, and What This Means for the Manager” and an ability to make accurate predictions regarding regional macroeconomic trends. If you ignore a market that’s unprofitable today, a rival could swoop in and establish network effects and other assets that are unbeatable tomorrow. But if you move too early, losses could drag you down. To make Facebook more appealing to low-end users, Facebook has built an app that requires just 1 percent of the computing resources used by its main smartphone app. Facebook Lite won’t support video, and images will be compressed, but users can post status updates and pictures, scroll through a news feed and get notifications. The firm will sell ads through Facebook Lite, even though high-appeal video and hi-res images aren’t on the platform.
Concerns aren’t just financial and technical; they’re also political and ethical. Facebook is officially banned in China (although many Chinese have used technical work-arounds to access the site), and Zuckerberg is clearly interested in the Chinese market. He reportedly spends an hour each day learning Chinese and has made several trips to China, addressing crowds in “halting, but passable” Mandarin. Some say even a censored Facebook would be a catalyst for Chinese democratic reform, while others see this as a compromise of the firm’s belief in the power of exchange and promoting the free flow of information. The firm’s COO Sheryl Sandberg said, “There are compromises on not being in China, and there are compromises on being in China. It’s not clear to me which one is bigger.”
The Admirable Goals and Unintended Consequences of Internet.org
Zuckerberg has also been thinking beyond short, to mid-term profits, and has declared Internet access to be a “human right.” As announced in a cover story in Time magazine, his explicit goal is “to make sure that actually, literally every single human being on Earth has an Internet connection.” To achieve the goal, Facebook actively worked on schemes for providing Internet access to areas with no signal. For example, a now-shuttered drone project hoped to circle underserved areas at altitudes above clouds and troubling weather, returning to earth only when they need maintenance. While these efforts get lots of press, the reality is that about 85 percent of the world’s population already lives within range of a cell tower with at least a 2G data network. So why are so many offline? Three reasons: 1) data is too expensive for many of the world’s poorest citizens; 2) services aren’t designed for emerging market use by populations who need ultra-low bandwidth services that run reliably on very low-end or old, recycled hardware; and 3) content is not compelling enough to draw in non-users. If done right, however, the impact of Internet could be life-changing. That device in a pocket is a tool to lubricate markets, educate, and connect citizens with government services and health care. A Deloitte study (albeit one commissioned by Facebook) posited that moving the population of India with Internet access from 15 percent to 75 percent would create sixty-five million jobs, cut extreme poverty by 28 percent, and reduce infant mortality by 85,000 deaths a year.
To get to Zuckerberg’s goal of everyone online, Facebook has partnered in the creation of Internet.org, a nonprofit organization crafting nonexclusive partnerships with local carriers to offer a free tier of services, a sort of “Internet dial tone” that includes social networking (of course), as well as vital information such as weather, health care information, education, and food prices, all through a lightweight app that runs on very low- end phones (often called “feature phones” as opposed to app-installing smartphones). The admirable goal of bringing the Internet to the masses has stumbled quite a bit. There were technical snafus—a SpaceX rocket carrying a Facebook satellite slated to bring Internet service to parts of sub-Saharan Africa blew up. The first test of the firm’s solar-powered drone crashed. And there were political problems—interests in India thwarted Facebook’s efforts, citing this was a walled-garden initiative that violated principles of net neutrality by creating a two-tiered Internet, one for the rich and one for the poor. Although Facebook vehemently protested, mentioning that the service was open to all firms (Google had joined), criticism continued. A rebranded effort “Free Basics” was meant to seem less like an ominous Internet takeover, but even this effort has had problems. The lofty intentions of connectivity have met the harsh reality of humanity’s dark side. Free Facebook in Myanmar has been blamed for fanning the flames of the Rohingya population genocide, with reports claiming Facebook had been pulled from the nation, as a result. Other Facebook-fueled hate outbreaks have been reported in Cambodia, the Philippines, and Sri Lanka. In many of these nations, Facebook has been seen as a way to get news without the bias of government affiliation, so the problem of fake news and hate speech may even be more influential in such populations. Facebook has claimed that its Internet.org efforts have connected over 100 million people to the Internet, but what were likely well-intentioned efforts also exposed unseen and unintended consequences that can often accompany technology use. The rollout of Libra, with Facebook holding only a fractional stake in the system, may be another opportunity for impact in the developing world. 2018 global currency flows sent to low- and middle-income countries, mostly from relatives working abroad, exceeded half a trillion dollars, with most subject to what the AsiaTimes refers to as exorbitant transfer fees and using ancient technology. A stable, worldwide global currency with razor-thin transaction costs could revolutionize this massive market.
Stay tuned, as Zuckerberg enters his thirties, it looks like he’s just getting started.
Internet.org Users in Zambia
Hear from a diverse group of Internet.org users in Zambia on how the service has impacted their lives.
CATEGORIES
Economics
Nursing
Applied Sciences
Psychology
Science
Management
Computer Science
Human Resource Management
Accounting
Information Systems
English
Anatomy
Operations Management
Sociology
Literature
Education
Business & Finance
Marketing
Engineering
Statistics
Biology
Political Science
Reading
History
Financial markets
Philosophy
Mathematics
Law
Criminal
Architecture and Design
Government
Social Science
World history
Chemistry
Humanities
Business Finance
Writing
Programming
Telecommunications Engineering
Geography
Physics
Spanish
ach
e. Embedded Entrepreneurship
f. Three Social Entrepreneurship Models
g. Social-Founder Identity
h. Micros-enterprise Development
Outcomes
Subset 2. Indigenous Entrepreneurship Approaches (Outside of Canada)
a. Indigenous Australian Entrepreneurs Exami
Calculus
(people influence of
others) processes that you perceived occurs in this specific Institution Select one of the forms of stratification highlighted (focus on inter the intersectionalities
of these three) to reflect and analyze the potential ways these (
American history
Pharmacology
Ancient history
. Also
Numerical analysis
Environmental science
Electrical Engineering
Precalculus
Physiology
Civil Engineering
Electronic Engineering
ness Horizons
Algebra
Geology
Physical chemistry
nt
When considering both O
lassrooms
Civil
Probability
ions
Identify a specific consumer product that you or your family have used for quite some time. This might be a branded smartphone (if you have used several versions over the years)
or the court to consider in its deliberations. Locard’s exchange principle argues that during the commission of a crime
Chemical Engineering
Ecology
aragraphs (meaning 25 sentences or more). Your assignment may be more than 5 paragraphs but not less.
INSTRUCTIONS:
To access the FNU Online Library for journals and articles you can go the FNU library link here:
https://www.fnu.edu/library/
In order to
n that draws upon the theoretical reading to explain and contextualize the design choices. Be sure to directly quote or paraphrase the reading
ce to the vaccine. Your campaign must educate and inform the audience on the benefits but also create for safe and open dialogue. A key metric of your campaign will be the direct increase in numbers.
Key outcomes: The approach that you take must be clear
Mechanical Engineering
Organic chemistry
Geometry
nment
Topic
You will need to pick one topic for your project (5 pts)
Literature search
You will need to perform a literature search for your topic
Geophysics
you been involved with a company doing a redesign of business processes
Communication on Customer Relations. Discuss how two-way communication on social media channels impacts businesses both positively and negatively. Provide any personal examples from your experience
od pressure and hypertension via a community-wide intervention that targets the problem across the lifespan (i.e. includes all ages).
Develop a community-wide intervention to reduce elevated blood pressure and hypertension in the State of Alabama that in
in body of the report
Conclusions
References (8 References Minimum)
*** Words count = 2000 words.
*** In-Text Citations and References using Harvard style.
*** In Task section I’ve chose (Economic issues in overseas contracting)"
Electromagnetism
w or quality improvement; it was just all part of good nursing care. The goal for quality improvement is to monitor patient outcomes using statistics for comparison to standards of care for different diseases
e a 1 to 2 slide Microsoft PowerPoint presentation on the different models of case management. Include speaker notes... .....Describe three different models of case management.
visual representations of information. They can include numbers
SSAY
ame workbook for all 3 milestones. You do not need to download a new copy for Milestones 2 or 3. When you submit Milestone 3
pages):
Provide a description of an existing intervention in Canada
making the appropriate buying decisions in an ethical and professional manner.
Topic: Purchasing and Technology
You read about blockchain ledger technology. Now do some additional research out on the Internet and share your URL with the rest of the class
be aware of which features their competitors are opting to include so the product development teams can design similar or enhanced features to attract more of the market. The more unique
low (The Top Health Industry Trends to Watch in 2015) to assist you with this discussion.
https://youtu.be/fRym_jyuBc0
Next year the $2.8 trillion U.S. healthcare industry will finally begin to look and feel more like the rest of the business wo
evidence-based primary care curriculum. Throughout your nurse practitioner program
Vignette
Understanding Gender Fluidity
Providing Inclusive Quality Care
Affirming Clinical Encounters
Conclusion
References
Nurse Practitioner Knowledge
Mechanics
and word limit is unit as a guide only.
The assessment may be re-attempted on two further occasions (maximum three attempts in total). All assessments must be resubmitted 3 days within receiving your unsatisfactory grade. You must clearly indicate “Re-su
Trigonometry
Article writing
Other
5. June 29
After the components sending to the manufacturing house
1. In 1972 the Furman v. Georgia case resulted in a decision that would put action into motion. Furman was originally sentenced to death because of a murder he committed in Georgia but the court debated whether or not this was a violation of his 8th amend
One of the first conflicts that would need to be investigated would be whether the human service professional followed the responsibility to client ethical standard. While developing a relationship with client it is important to clarify that if danger or
Ethical behavior is a critical topic in the workplace because the impact of it can make or break a business
No matter which type of health care organization
With a direct sale
During the pandemic
Computers are being used to monitor the spread of outbreaks in different areas of the world and with this record
3. Furman v. Georgia is a U.S Supreme Court case that resolves around the Eighth Amendments ban on cruel and unsual punishment in death penalty cases. The Furman v. Georgia case was based on Furman being convicted of murder in Georgia. Furman was caught i
One major ethical conflict that may arise in my investigation is the Responsibility to Client in both Standard 3 and Standard 4 of the Ethical Standards for Human Service Professionals (2015). Making sure we do not disclose information without consent ev
4. Identify two examples of real world problems that you have observed in your personal
Summary & Evaluation: Reference & 188. Academic Search Ultimate
Ethics
We can mention at least one example of how the violation of ethical standards can be prevented. Many organizations promote ethical self-regulation by creating moral codes to help direct their business activities
*DDB is used for the first three years
For example
The inbound logistics for William Instrument refer to purchase components from various electronic firms. During the purchase process William need to consider the quality and price of the components. In this case
4. A U.S. Supreme Court case known as Furman v. Georgia (1972) is a landmark case that involved Eighth Amendment’s ban of unusual and cruel punishment in death penalty cases (Furman v. Georgia (1972)
With covid coming into place
In my opinion
with
Not necessarily all home buyers are the same! When you choose to work with we buy ugly houses Baltimore & nationwide USA
The ability to view ourselves from an unbiased perspective allows us to critically assess our personal strengths and weaknesses. This is an important step in the process of finding the right resources for our personal learning style. Ego and pride can be
· By Day 1 of this week
While you must form your answers to the questions below from our assigned reading material
CliftonLarsonAllen LLP (2013)
5 The family dynamic is awkward at first since the most outgoing and straight forward person in the family in Linda
Urien
The most important benefit of my statistical analysis would be the accuracy with which I interpret the data. The greatest obstacle
From a similar but larger point of view
4 In order to get the entire family to come back for another session I would suggest coming in on a day the restaurant is not open
When seeking to identify a patient’s health condition
After viewing the you tube videos on prayer
Your paper must be at least two pages in length (not counting the title and reference pages)
The word assimilate is negative to me. I believe everyone should learn about a country that they are going to live in. It doesnt mean that they have to believe that everything in America is better than where they came from. It means that they care enough
Data collection
Single Subject Chris is a social worker in a geriatric case management program located in a midsize Northeastern town. She has an MSW and is part of a team of case managers that likes to continuously improve on its practice. The team is currently using an
I would start off with Linda on repeating her options for the child and going over what she is feeling with each option. I would want to find out what she is afraid of. I would avoid asking her any “why” questions because I want her to be in the here an
Summarize the advantages and disadvantages of using an Internet site as means of collecting data for psychological research (Comp 2.1) 25.0\% Summarization of the advantages and disadvantages of using an Internet site as means of collecting data for psych
Identify the type of research used in a chosen study
Compose a 1
Optics
effect relationship becomes more difficult—as the researcher cannot enact total control of another person even in an experimental environment. Social workers serve clients in highly complex real-world environments. Clients often implement recommended inte
I think knowing more about you will allow you to be able to choose the right resources
Be 4 pages in length
soft MB-920 dumps review and documentation and high-quality listing pdf MB-920 braindumps also recommended and approved by Microsoft experts. The practical test
g
One thing you will need to do in college is learn how to find and use references. References support your ideas. College-level work must be supported by research. You are expected to do that for this paper. You will research
Elaborate on any potential confounds or ethical concerns while participating in the psychological study 20.0\% Elaboration on any potential confounds or ethical concerns while participating in the psychological study is missing. Elaboration on any potenti
3 The first thing I would do in the family’s first session is develop a genogram of the family to get an idea of all the individuals who play a major role in Linda’s life. After establishing where each member is in relation to the family
A Health in All Policies approach
Note: The requirements outlined below correspond to the grading criteria in the scoring guide. At a minimum
Chen
Read Connecting Communities and Complexity: A Case Study in Creating the Conditions for Transformational Change
Read Reflections on Cultural Humility
Read A Basic Guide to ABCD Community Organizing
Use the bolded black section and sub-section titles below to organize your paper. For each section
Losinski forwarded the article on a priority basis to Mary Scott
Losinksi wanted details on use of the ED at CGH. He asked the administrative resident