Social Climber

Despite increased competition,Facebook is well-positioned to be the future of the mobileweb with its acquisition of Instagram and WhatsApp, writesJamie Carter

PUBLISHED : Friday, 04 July, 2014, 12:38am
UPDATED : Friday, 04 July, 2014, 12:38am

What social platform do you use? What you use, and where you use it, says a lot about you - and especially about where you live.

Facebook is the leading social network, and by quite some distance, according to the latest research by GlobalWebIndex. It reveals that a whopping 83 per cent of internet users around the world aged 16 to 64 now have a Facebook account, a figure that's still growing. Lining up behind Facebook are Google+, YouTube and Twitter, although those figures hide some massive regional differences.

Twitter is the biggest social media platform in Japan, as of this year, while Google+ is growing fast in the developing world. Meanwhile, WhatsApp is used by over half of the online populations of Hong Kong, South Africa, Malaysia and Singapore - and it's the most used app in Brazil, Indonesia and South Africa. However, the GWI data reveals that Instagram is the fastest rising social platform overall, with a 25 per cent increase in active user numbers in the last six months.

Facebook already has the lion’s share of all social logins … 53 per cent globally

No wonder, then, that Facebook now owns both WhatsApp and Instagram. It's part of Facebook's aggressive intention to dominate the mobile web sphere, which is destined to become the de facto online experience for most of us - if it isn't already.

"Facebook already has the lion's share of all social logins, accounting for 53 per cent globally," says Patrick Salyer, CEO of US-based social data company Gigya.

"Mobile logins are even higher, accounting for 62 per cent globally, showing a clear dominance in the mobile space."

Although Google is second to Facebook, it lags behind with just a 26 per cent share, while 87 per cent of mobile internet users visit it each month. Facebook gets 10 per cent fewer views.

The social media platform's increasing domination of the mobile web has got analysts wondering whether it could soon overtake Google as the main arbiter of the online experience.

China, of course, is the exception to all of this. With Facebook banned by the government, social networking is dominated by WeChat, Qzone, Sina Weibo and Tencent Weibo, with Youku, Qzone and Tudou on the rise. However, Facebook does have a role.

"Each month, 16 per cent of China's adult internet population say they use Facebook, with millions turning to virtual private networks and proxy servers in order to bypass the government's restrictions," says GlobalWebIndex's head of trends, Jason Mander.

Besides, the "great firewall" is being circumvented. Step forward Facebook's key recent acquisitions, Instagram and WhatsApp, which Mark Holden, head of futures at Arena Media UK, thinks might act as Trojan horses to help develop a bigger footprint in China, and Asia as a whole. "The potential to build a user base in China, even if a minority one, may be one of the most strategically valuable parts of the WhatsApp and Instagram acquisitions," he says.

The purchase of those apps is significant because it shows Facebook's hand. Neither service has been rolled into the Facebook platform, but kept distinct. "Facebook has only really begun to grasp the importance of mobile recently," says Dave Wallace, CEO of Heath Wallace.

He thinks that the rise of mobile demonstrates that small devices are perfect for sharing and consuming content as well as browsing, and that mobile will become the dominant access device for Facebook.

"For many Gen Y users, mobile and tablets will be the only way they choose to access it," he says. "Building and buying a suite of functions around mobile is where the company seems to be heading - as with its acquisition of WhatsApp and the atomisation of its functionality into individual apps."

Ben Austin, CEO at UK-based Absolute Digital Media, says: "The acquisition of WhatsApp is being seen by some as a step towards Facebook becoming a hub for different apps rather than a unique platform in its own right."

Austin thinks that when Facebook sees something successful, it either tries to buy it, or makes its own version. "We've seen this with Instagram, WhatsApp - and Snapchat, which turned down an offer of US$20 billion (HK$155 billion) from Facebook." Facebook retaliated by creating its own version called Slingshot. "If it carries on like this, it's hard to picture how it won't continue this dominance."

Being all things to all people is impossible, and the acquisition of messaging app WhatsApp - which is largely about restoring young people's interest in the network - could be misguided. Teens have been leaving the site in their droves, but can the addition of WhatsApp reverse that trend? "The motive behind it screams desperation," says Austin. "What Facebook is forgetting is that teenagers are fickle. It doesn't matter if you fix the problem because once they've moved on they'll be unlikely to return." However, messaging services like WhatsApp could soon eclipse SMS, and could eventually even replace voice communications; it's a big prize.

While Facebook's success and ambition makes it tempting to call it "the new Google", we're not there yet. Holden thinks that Facebook's dominance in mobile needs to be put into perspective. "It doesn't own the operating system layer of our smartphone experiences - Google, Apple and Microsoft play a far bigger role there," he says, citing the failure of Facebook Home, a user interface layer for Android devices that was roundly ignored.

"Google is far more dominant on mobile than Facebook," he says. "Android users can embed Google services right at the very heart of how they use their mobiles - through search, Google Now, the app marketplace, native applications, mapping and the need to link every Android device to a Google user ID."

It's hard to ignore Google Search, YouTube, Gmail and Maps. A Comscore report showed that Google apps reach a third more monthly unique mobile users than Facebook. "Facebook needs to work hard to retain its dominant position in the mobile experience," says Holden.

Others agree. "Facebook and Google are being driven from two entirely different places at the moment," says Will McInnes, chief marketing officer at social media analytics company Brandwatch. "Google is primarily driven by data, by providing useful services to consumers that help the company follow them around the web, and then derive insight and value from those digital contrails," he says. "Google is more like an incredibly intelligent piece of string that both guides and follows you throughout your day."

Facebook, on the other hand, is primarily driven by engagement. "Its places are much more defined - its website, its mobile app, Instagram. Facebook is more like a family of islands that connect, and that we carry around with us, continually visiting and then dipping away again."

Facebook's position is vital and fascinating, thinks McInnes, who likens it to a universal currency. "Like any currency, it can hold its value if others continue to value it, or it can slowly be eclipsed."

It could all boil down to what happens in - and comes out of - China. "China will be a key market to watch - services like Tencent's WeChat already have huge followings in China and are now looking to expand elsewhere," says Mander. "As more and more Chinese websites come to international prominence and consider initial public offerings, Facebook's presence in this market will become crucial to it maintaining a global dominance."