FACEBOOK’S BID FOR SNAPCHAT REVEALS MORE ABOUT FB’S STATUS THAN THAT OF SC

This week that Facebook attempted to acquire Snapchat for $3billion. Much of the initial media coverage focused on Snapchat’s growth and revenue opportunities, as well as surging tech valuations across the app industry. However, recently the discussion has turned more to Facebook and its future. Of course Snapchat is valuable due to its large, active, and rapidly growing user base, largely in the popular and difficult to target teen demographic. Additionally, while the app does not currently generate revenue, it reports daily photo uploads of 350 million – the same rate as Facebook. While it is important to consider this offer based on the consider the future of photo sharing via apps, the bid, along with Facebook’s purchase of Instagram last year, also illustrates the shift in how Facebook is used.

The New York Times ran a piece in today’s Sunday Business section dissecting how Facebook social activity has changed and why apps like Snapchat and Instagram will continue to receive seemingly outsized valuations for non-revenue-generating companies. While Facebook reported a 60% surge in quarterly revenue last month, the site also revealed declining daily visits, notably among its critical teen audience. While a mass exodus from the site is unlikely, users are looking to more specialized apps for daily messaging, photo sharing, and socializing. It will be interesting to see how marketers evolve their programming to address this change, and whether or not Facebook revenues continue to grow as the site is used less for social engagement and more, as the article describes, “akin to a yearbook or yellow pages”.

http://bits.blogs.nytimes.com/2013/11/16/still-on-facebook-but-finding-less-to-like/