Facebook is dead.
I’m aware that this is a bold statement, seeing as 3½ billion people are on Facebook.
That’s a sizeable user base for a dead tech giant.
How do I know that Facebook is dead?
Here’s the clue: Facebook won’t let me give them money.
Disclaimer: This is not investment advice. Tangled Web is about tech, not investment. It’s for information purposes only and you should not base any investment decisions on it. Do your own research.
Better late than never
I have to admit that I’m a little late here.
When I first wrote an outline for this article, it was a bold statement indeed to suggest that Facebook is dead.
Now that I’m finally putting it out there, however, it’s far from bold to hint that Facebook might not have as bright a future as it once did.
Over the last year, Meta, the holding company for Facebook, has fallen 57% on the NASDAQ. Sure, most tech stocks are down, but the NASDAQ composite index has fallen only 18% over the last year. In comparison to other tech stocks, Meta has taken a nose-dive.
If only I’d published this article when I’d first outlined it, I’d have looked like a tech oracle.
Too late for that, so let me tell you instead two short stories of how I tried to throw money at Facebook, and how they threw it back in my face.
Is facebook.com a phishing site?
Facebook, like Google, is an advertising company.
I know, I know, Facebook thinks it’s a tech company.
But according to Statista, in 2020, 97.9% of Facebook’s revenue came from advertising.
Sure, Facebook uses technology to help generate that revenue, but these days every corporation uses technology to help generate revenue.
Facebook is an advertising company.
So when I wanted to get the word out about my wood-carved maps and globes, I thought I’d try Facebook ads. I didn’t much like the idea of advertising through Facebook, but it’s hard for niche businesses like mine to get the word out any other way.
To get started with Facebook ads, I needed a Facebook account.
So I clicked the Create a new account button at facebook.com, entered my email address, and was up and running in no time. Right?
Wrong.
Facebook refused to let me create an account. They didn’t believe that I was human. They didn’t believe that I was me.
Failing to create a Facebook account was a process that took many weeks and involved ever more intrusive demands. I caved in to all these demands, giving Facebook access to the most confidential information about myself and my business. Every time I gave them more, I was told, in a manner that left no doubt that they thought I was a deplorable person, or, worse, a non-person, that they would get back to me. Days or weeks later, they would, indeed, get back to me... with further demands.
At no point was there any option to talk to a human. Whatever it was that convinced Facebook’s software that I should not be allowed to create an account would no doubt have been cleared up in a moment if I’d been allowed to talk to a human. Unfortunately, whatever it was that convinced the software that I should not be allowed to create an account also convinced the software that I should not be allowed to talk to a human.
Facebook’s final demand was that I upload my passport. Dutifully, I did so, despite nagging doubts as to the wisdom of transmitting an image of my passport to Facebook’s servers. Again, I was told that they would get back to me.
I never heard from them again.
I began to wonder whether facebook.com is a phishing site. Maybe Mark Zuckerberg, in the most elaborate scam ever, created Facebook not to make billions of dollars, but simply to steal my identity?
Well, maybe not. No doubt the truth is more mundane than that.
The clue to what was really going on here was the font in which Facebook presented its demands.
Yes, the font. Fonts can tell you a lot. This font wasn’t the one you see in your Facebook newsfeed. It was an embarrassingly bad font that looked like it was out of the nineties.
These days, when any web designer has free access to thousands of beautiful web fonts, a web page in an embarrassingly bad font out of the nineties is a sure sign that no web designer was involved in creating that page.
The font was a sign that Facebook simply didn’t care whether I was able to create a new account.
Facebook was printing so much money that allowing new customers to sign up for Facebook ads just wasn’t a priority.
Think about that for a moment.
Facebook was a business that simply didn’t care about acquiring new customers for its core product, from which it earns 97.9% of its revenue.
Into the beyond
I know what you’re thinking. That’s the old Facebook. Facebook isn’t even called Facebook any more, it’s called Meta. It’s no longer about advertising, it’s about the metaverse. Facebook might be old and tired, but Meta is alive and kicking. Right?
Wrong.
I’m deeply interested in the metaverse, nebulous as that term might be, and in virtual reality in particular.
So, naturally, I’ve investigated headsets, with a view to implementing the Open Web Mind in virtual reality.
The obvious choice was the Oculus Quest. I didn’t much like the idea of buying a virtual reality headset from Facebook, the owner of Oculus, but it seemed sensible to implement the Open Web Mind on the most widely-used headset.
After a little investigation, however, I discovered that you can’t use the Oculus Quest without a Facebook account.
And I didn’t have a Facebook account.
And I couldn’t get a Facebook account.
Because, well, I’ve just told you the story of the Kafkaesque process I had to go through to fail to create a Facebook account.
Once again, I’d tried to throw money at Facebook, to buy a virtual reality headset, and once again, they’d thrown it back in my face.
Obviously I’m not welcome in Meta’s metaverse.
The innovator’s dilemma
None of this should come as a surprise.
This is how it goes with companies as stupendously successful as Facebook.
First, they get fat. They’re printing so much money that they simply don’t care about acquiring new customers.
Next, they realize that they’ve hit a hard limit. Their core product has eaten the world, and there are no new customers to acquire. Even if they came back, cap in hand, to those they’d previously spurned, like me, they wouldn’t be able to meet their investors’ expectations for further growth. So they branch out, creating new products in new markets. New products like the Oculus Quest, in new markets like the metaverse.
Then, they find that they’re not as good at creating these new products in these new markets as they were with their core product in their core market.
Facebook succeeded as a startup that moved fast and broke things. It created an extraordinarily successful social network and monetized it with an extraordinarily successful advertising model. It would be astonishing if it succeeded to the same extent in a new field as highly innovative as virtual reality, now that it’s no longer a startup, can’t move fast and gets hauled before Congress whenever it breaks things.
But it’s worse than that.
Facebook’s advertising model makes so much money that it can’t help but strangle the company’s metaverse ambitions.
The proof?
You can’t use the Oculus Quest without a Facebook account.
Which means that Meta cares more about Facebook accounts than about the Oculus Quest.
Which means that it cares more about advertising than about the metaverse.
It has to: advertising is where all its money comes from.
Life support
Facebook’s death will be long and slow. Those billions of dollars of advertising revenue could keep it on life support for decades.
But Facebook’s refusal to allow me to throw money at it to advertise my wood-carved maps and globes suggests to me that its advertising business is in terminal decline.
And Facebook’s refusal to allow me to implement the Open Web Mind on the Oculus Quest suggests to me that its metaverse business will be strangled at birth.
Facebook is dead. It just doesn’t know it yet.