in Startups

More on how I was right – Facebook is dead as a platform

I am sitting here watching my cat chase his tail (what does that say about me?), and it reminded me that I was going to make this post.

This time last year, just as everyone was getting the Facebook logo tattooed on their butt and while my buddies were trying to figure out the science of breaking up with someone they had listed as a relationship on their profile, I went against the grain.

Almost exactly 1 year ago, I took the time to tell you that you were all deluded, that the Facebook Platform made no business sense and that this was all going to come crashing down.

Then, just 4 months later, I got on my high horse (on which I am still firmly mounted) and I wrote that I was right. The house of cards came down even faster than the credit markets.

So, I am back again, thinking I will gloat a little more, and tell you that if you haven’t moved on yet, then you need to get over it. Your relationship with Facebook is unhealthy. It is a fine place to find old boyfriends and girlfriends from High School, but it is no place to make a business.

As your mother would say: I told you so.

Now we are at the point that even the people who were making money off of Facebook applications are willing to admit that the whole thing has gone down the tubes.

Scott Rafer, the founder of Facebook App shop Lookery, recently declared the Facebook Platform “dead” at the Facebook Developer Conference in Berlin.

“Lookery’s own statistics from Quantcast suggest that their publisher traffic has been almost halved since the new site design was released. Ultimately, I think we may see an increase in traffic as users become educated on the new design but there is no doubt that developers were impacted significantly.”

The redesign of Facebook was just the final nail in the coffin of the world of Facebook applications, but it is representatitve of a point I made in my first post on this subject: “You cannot build a business on someone else’s platform when they don’t see you as a partner.”

As an app developer, you were a customer of Facebook. A guest and a test market. You were disposible.

Build for a real platform

What is a real platform? Here are some examples:

The Web.
Yes, all those things you loved about Facebook, The Web has them too, and more, and better,. more better.

The Web has an API, it has users (a lot more than Facebook), and it is pliable and you can apply all sorts of revenue models on top of it. Yes, the web is a wonderful place to put things that have value.

Sure, the web isn’t for lazy folks. It isn’t like Facebook in November 2007 when you could get 50,000 people running your app which displayed various types of mullets, but you know what, if you put a little elbow grease in to it, you just might get 50,000 users, and you might get 5million, and they will be all YOURS.

Microsoft Outlook
I’m not telling you this is a MUST-BUILD platform, but it is worth taking a look at. Outlook has proven itself as a great platform on which to build. From a development perspective I am sure it is a total pain, but once you are in there, you have as much access to someone’s “social graph” as Facebook could ever give you, and your ability to integrate with Outlook is limited only by your imagination and the willingness of your users.

The Blackberry
I might get a rough ride for this one, but the Blackberry is the ultimate platform. Blackberry users are addicted. They are fiends and they ALL HAVE MONEY. Here is the other thing: Blackberry has been getting a lot of grief for not having an app store like Apple does for the iPhone. I have to agree that it seems silly, but there is a reason: RIM does not want to be a gatekeeper. You can install whatever you want on a Blackberry, and through that, RIM ensures that they are not the broker of success on thier hardware. The web is where Blackberry apps compete.

Now, sure RIM recently announced carrier-specific app stores, but those will probably die off, and they are about RIM pleasing the carrier. The ability for anyone to be able to install your app will still live on.

So go on, get out there and build on top of things that care about you, your users and your business.

35 Comments

  1. I feel I should comment for consistency’s sake. The initial promise of FB was certainly unmet. Kudos to you for seeing the way in which FB would treat developers. There were still some success stories, and some millionaires were made, but overall not the Next Big Thing.

    Now Facebook Connect, that’s where the real party is!

  2. I feel I should comment for consistency's sake. The initial promise of FB was certainly unmet. Kudos to you for seeing the way in which FB would treat developers. There were still some success stories, and some millionaires were made, but overall not the Next Big Thing.

    Now Facebook Connect, that's where the real party is!

  3. Sorry for the ridiculous gloating,. I am being a jerk to have some fun. ;-)

    That said, I KNEW you would bring up connect. I am still digging in on it and need to understand it a bit better, so no comments yet good or bad.

  4. Sorry for the ridiculous gloating,. I am being a jerk to have some fun. ;-)

    That said, I KNEW you would bring up connect. I am still digging in on it and need to understand it a bit better, so no comments yet good or bad.

  5. I think it’s a good thing. But I was wrong before… :P

    Looking forward to hearing your analysis.

  6. I think it's a good thing. But I was wrong before… :P

    Looking forward to hearing your analysis.

  7. Jevon,

    Absolutely true. I have been saying the same thing myself for a long time. Facebook was much better when it was simply about keeping in touch with friends, planning events, and posting pictures. After they opened it up as a platform it soon became cluttered with people throwing hot-dogs and vampire bites. When I saw how the new interface design was trying to suppress all these terrible applications, I new the people at Facebook had realized the same thing.

    Your Microsoft paint image in the middle was a nice touch.

  8. Jevon,

    Absolutely true. I have been saying the same thing myself for a long time. Facebook was much better when it was simply about keeping in touch with friends, planning events, and posting pictures. After they opened it up as a platform it soon became cluttered with people throwing hot-dogs and vampire bites. When I saw how the new interface design was trying to suppress all these terrible applications, I new the people at Facebook had realized the same thing.

    Your Microsoft paint image in the middle was a nice touch.

  9. “Your Microsoft paint image in the middle was a nice touch.” — I am glad somebody noticed!

  10. “Your Microsoft paint image in the middle was a nice touch.” — I am glad somebody noticed!

  11. Jevon I think you’re right that FB is dead in terms of being a developer or building on their Social Network; but I don’t think it’s dead as a standalone service/product. People still use it, and subscribers are growing. FB is about one-one or one-few group relationships, the apps don’t reflect that very nature.

    FB totally messed up it’s partnering/developer program and I think they realized this with the silly apps that were built like racing cars and vampire bites – RIM is smarter in this regard. It was novel so people tried it, but in our 90-Second Economy or Attention Economy, they aren’t sustainable. We get bored too fast!

    It’s how FB is “used” by Participants (I hate the term “user”) that is changing. It will be a “connecting” place, then once connected, the relationship will move elsewhere (i.e. Outlook or a phone call) and FB just becomes a hub. It’s a “general” space for all demographics, whereas LinkedIn is more business focused…further fragmentation.

    It’s not dead, just morphing. I think Facebook Connect is as useless as Flock, which will fade to be a minor player.

  12. Jevon I think you're right that FB is dead in terms of being a developer or building on their Social Network; but I don't think it's dead as a standalone service/product. People still use it, and subscribers are growing. FB is about one-one or one-few group relationships, the apps don't reflect that very nature.

    FB totally messed up it's partnering/developer program and I think they realized this with the silly apps that were built like racing cars and vampire bites – RIM is smarter in this regard. It was novel so people tried it, but in our 90-Second Economy or Attention Economy, they aren't sustainable. We get bored too fast!

    It's how FB is “used” by Participants (I hate the term “user”) that is changing. It will be a “connecting” place, then once connected, the relationship will move elsewhere (i.e. Outlook or a phone call) and FB just becomes a hub. It's a “general” space for all demographics, whereas LinkedIn is more business focused…further fragmentation.

    It's not dead, just morphing. I think Facebook Connect is as useless as Flock, which will fade to be a minor player.

  13. The new Facebook profile has been a good separator of engaging applications vs non-engaging. If your strategy on FB was to put up a profile box and have users spam their friends for virtual dollars its a tough change…

    I still believe that the Facebook Application platform is a powerful tool to promote your brand or you website. Purely from a traffic perspective Facebook is good value. There are very few cheaper sources even if you completely ignore the brand development that is also possible.

    I think the value of Facebook is still ease of communication and engagement within your friend network. This is available for free, on most of the other platforms listed the communications between individuals are limited and there is no structure of friend relationships. The result is that the virality of these platforms is fairly limited and your cost per engagement is very high ( ie search at cost per click ).

  14. The new Facebook profile has been a good separator of engaging applications vs non-engaging. If your strategy on FB was to put up a profile box and have users spam their friends for virtual dollars its a tough change…

    I still believe that the Facebook Application platform is a powerful tool to promote your brand or you website. Purely from a traffic perspective Facebook is good value. There are very few cheaper sources even if you completely ignore the brand development that is also possible.

    I think the value of Facebook is still ease of communication and engagement within your friend network. This is available for free, on most of the other platforms listed the communications between individuals are limited and there is no structure of friend relationships. The result is that the virality of these platforms is fairly limited and your cost per engagement is very high ( ie search at cost per click ).

  15. FB’s still not a bad way to cheaply acquire users to other sites, but the application market is not maturing as people hoped. I’ve seen great user acquisition success with FB groups and highly target advertising using the FB platform (although my own effort fell flat on its face.)

    My big question is how the iPhone application world will evolve… any thoughts? (I know you have to support RIM given your location, but still you must have an opinion.)

  16. FB's still not a bad way to cheaply acquire users to other sites, but the application market is not maturing as people hoped. I've seen great user acquisition success with FB groups and highly target advertising using the FB platform (although my own effort fell flat on its face.)

    My big question is how the iPhone application world will evolve… any thoughts? (I know you have to support RIM given your location, but still you must have an opinion.)

  17. Outlook and Blackberry are definitely dominant and where the action is now as far as social graph content and mobile device powerusers – if you can leverage it. Organizationally though I think both MS and BB are struggling with really understanding the way the markets and ‘users’ are evolving. Google and to a lesser degree Apple, are making serious moves much more effortlessly – moves that I think could tip the game very quickly. I keep thinking to the social/semantic gold mine sitting with google as I host email through google apps, run all my searches through them, and will likely move to Android within the next year. Their big test – which is being challenged – is if they can maintain their ‘do no evil’ position. Be interested to see where startups are making their bets at startupempire.

  18. Outlook and Blackberry are definitely dominant and where the action is now as far as social graph content and mobile device powerusers – if you can leverage it. Organizationally though I think both MS and BB are struggling with really understanding the way the markets and 'users' are evolving. Google and to a lesser degree Apple, are making serious moves much more effortlessly – moves that I think could tip the game very quickly. I keep thinking to the social/semantic gold mine sitting with google as I host email through google apps, run all my searches through them, and will likely move to Android within the next year. Their big test – which is being challenged – is if they can maintain their 'do no evil' position. Be interested to see where startups are making their bets at startupempire.

  19. Hey Jevon!

    Great article. This caught my eye because we’ve had this conversation come up almost on a weekly basis. These are interesting times and we can’t help but keep contrasting Facebook’s / Apple’s / Google’s path from 2004-on vs. Microsoft’s path from 1994-on. You’ve pointed out how the way a platform sees its partners is key. I couldn’t agree more. With MS in the 90’s, you had an ISV with a piece of software it could sell with no cut going to MS. These attractive economics were a crucial driver in the creation of the biggest, most successful platform of all time, MS Windows.

    Facebook’s (ongoing) practice of serving its own ads alongside its platform apps always struck me as out-of-line in terms of a healthy platform/partner relationship, since they were/are directly cutting into profits that (IMO) rightly belong to the independent software creators. The equivalent in the 90’s would have been MS charging a profit-damaging “MS tax” on every piece of Windows software that went into the marketplace.

    The next big thing in software may be a company that offers the same thing MS offered in the 90’s: a general platform with broad reach and no (direct) cutting into partners’ profits. “Cloud” infrastructure companies and companies that abstract the infrastructure to increase development productivity could be ideal candidates.

    Time will tell whether Facebook will become the MS of the 2000’s, or just another app on top of a “real” killer platform, yet to be revealed.

  20. Hey Jevon!

    Great article. This caught my eye because we've had this conversation come up almost on a weekly basis. These are interesting times and we can't help but keep contrasting Facebook's / Apple's / Google's path from 2004-on vs. Microsoft's path from 1994-on. You've pointed out how the way a platform sees its partners is key. I couldn't agree more. With MS in the 90's, you had an ISV with a piece of software it could sell with no cut going to MS. These attractive economics were a crucial driver in the creation of the biggest, most successful platform of all time, MS Windows.

    Facebook's (ongoing) practice of serving its own ads alongside its platform apps always struck me as out-of-line in terms of a healthy platform/partner relationship, since they were/are directly cutting into profits that (IMO) rightly belong to the independent software creators. The equivalent in the 90's would have been MS charging a profit-damaging “MS tax” on every piece of Windows software that went into the marketplace.

    The next big thing in software may be a company that offers the same thing MS offered in the 90's: a general platform with broad reach and no (direct) cutting into partners' profits. “Cloud” infrastructure companies and companies that abstract the infrastructure to increase development productivity could be ideal candidates.

    Time will tell whether Facebook will become the MS of the 2000's, or just another app on top of a “real” killer platform, yet to be revealed.

  21. I have always seen – and in some cases written and spoke – that Facebook in and of itself was someone else’s system… and any app developer was the equivalent of the bootleg t-shirt salesperson… there might be a market, but watch out for two things: (1) when the venue decides to sell competitive products to your bootlegs… your market shrinks significantly…
    (2) annoyed fans who just wanted to see the concert and find your bootleg booth in way of their view… and watch your customer service/complaints handling and acquisition costs increase…
    While my view is often seen as too direct/clear-cut… at least my general perspective is shared by someone…
    D.

  22. I have always seen – and in some cases written and spoke – that Facebook in and of itself was someone else's system… and any app developer was the equivalent of the bootleg t-shirt salesperson… there might be a market, but watch out for two things: (1) when the venue decides to sell competitive products to your bootlegs… your market shrinks significantly…
    (2) annoyed fans who just wanted to see the concert and find your bootleg booth in way of their view… and watch your customer service/complaints handling and acquisition costs increase…
    While my view is often seen as too direct/clear-cut… at least my general perspective is shared by someone…
    D.

  23. I think both Jevon's comment about “The Web” as a platform and Igniter's about Google are bang on. “Do no evil” and stop trying to rule your own little empire becomes ever more important as the glass on the fishbowl we're all living in gets clearer and clearer. Google's support of Open ID is no accident – it's both a very smart business decision and a PR move, that announces loud and clear it doesn't want to just be in the search business but the Web business. And Igniter, you'll see at StartupEmpire where I'm making my bet.

  24. I think both Jevon’s comment about “The Web” as a platform and Igniter’s about Google are bang on. “Do no evil” and stop trying to rule your own little empire becomes ever more important as the glass on the fishbowl we’re all living in gets clearer and clearer. Google’s support of Open ID is no accident – it’s both a very smart business decision and a PR move, that announces loud and clear it doesn’t want to just be in the search business but the Web business. And Igniter, you’ll see at StartupEmpire where I’m making my bet.

  25. While most Facebook applications saw a dramatic decrease in usage after the new profile launch, but that doesn't mean that that platform is dead. It is just that with any closed platform, if the owner's of that platform decide to change it to the detriment of its eco-system. Yea, it hurts when your revenue is cut in half, but you are playing in some one else's sandbox, so they make the rules.

    I think it has made app developers take the reality pill and realize that Facebook isn't the magical fountain of cheap user acquisition and unlimited revenue that doesn't have any string attached. But compared to other mediums and online mechanisms, it is still one of the best places to raise awareness of brands and to acquire users.

    Facebook is just another platform, but it should remain on the list of top platforms (for now) along with iPhone, Blackberry, Web and Windows. It will probably and eventually go the way of Friendster when newer options come in to the market and present a more compelling value-proposition to its target audience.

  26. While most Facebook applications saw a dramatic decrease in usage after the new profile launch, but that doesn’t mean that that platform is dead. It is just that with any closed platform, if the owner’s of that platform decide to change it to the detriment of its eco-system. Yea, it hurts when your revenue is cut in half, but you are playing in some one else’s sandbox, so they make the rules.

    I think it has made app developers take the reality pill and realize that Facebook isn’t the magical fountain of cheap user acquisition and unlimited revenue that doesn’t have any string attached. But compared to other mediums and online mechanisms, it is still one of the best places to raise awareness of brands and to acquire users.

    Facebook is just another platform, but it should remain on the list of top platforms (for now) along with iPhone, Blackberry, Web and Windows. It will probably and eventually go the way of Friendster when newer options come in to the market and present a more compelling value-proposition to its target audience.

  27. You can believe those rumors all you want, but a lot of purported “revenue” numbers from FB developers have been debunked in the last year.

  28. You can believe those rumors all you want, but a lot of purported “revenue” numbers from FB developers have been debunked in the last year.

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