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Facebook New Apps and Information Effects

Facebook, the social network giant, has published five new mobile apps this year. Recently, Facebook launched a new mobile app called Facebook Groups. The group feature is one of the most popular tools on Facebook. Simply speaking, the new Groups app is just the company’s strategy to split its group feature from its major mobile app, giving users another way to access their groups, instead of digging through the sophisticated Facebook app.

Earlier this year, Facebook removed messaging from its main app and forced users to transfer to their Messenger app for chats. This move caused a large range of rage among users. The Messenger app’s rating on App Store dropped from 4.5 stars to only 1.5 stars. In fact, the Messenger app had existed since 2012. The only explanation for the plunge of its rating can only be traced to users’ anger toward the company’s imperious removal of messaging feature.

The separation of messaging on mobile devices is just an example of Facebook’s failure in mobile app markets. All the other apps the company launched this year have not drawn enough attention from its more than 1 billion users. Slingshot, Facebook’s product that more or less cloned Snapchat, did not successfully divert Snapchat users to its platform. As we can observe around ourselves, friends are still using Snapchat for photo messaging. Facebook’s attempt to compete with Snapchat in photo messaging market already flopped.

TIME magazine commented on Facebook’s problem:

“If there’s one project that’s stumped the company, it’s the very thing that made Facebook what it is today: Creating the Next Big Thing, particularly in the form of a new mobile app.”

Several years ago, Facebook plundered MySpace’s

We could explain both its success and failure with the knowledge of information and network effects.

As we learned in class, since people make choices knowing others’ decisions, there exists a tipping point which determines whether a product could success or fail.  The product’s popularity largely depends on whether it could pass the tipping point. The phenomenon is more prominent for social network apps as the driving force behind any user’s activeness or quit on a platform is whether or not the user’s friends are participating.

Once any social network website gains a user base that is large enough to exceed the tipping point,  the information effect would push it to continuously win more users until it establishes a dominant status among its comparable competitors. This is how Facebook entirely took over MySpace within a very short period. However, there cannot be a player that wins every single match. The battle between Facebook and Snapchat on photo messaging service was already in favor of the latter when Facebook set foot in the field, since it is much easier for the precursor to gain popularity and a large user base if both companies have almost identical products. After its popularity stabilized, the late-comers must develop some truly groundbreaking features to attract the crowd to use their products. The tipping point is extremely hard to reach when the previous product has become what Facebook is in today’s social networking market or Google in the search market. For these tech giants to succeed in other fields, they have to launch revolutionary products . The dominating power in their own market in not going to help them succeed everywhere.




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November 2014