Tue. Feb 27th, 2024

Facebook will have a billion users next year, according to Mark Zuckerberg Reuters

Facebook will reach one billion monthly active users sometime next year, CEO Mark Zuckerberg told an audience in France this week.

Now that it’s about to reach such a huge number, Facebook is eyeing another: 25 billion – the amount of dollars Web giant Google pulls in from search advertising every year.

Facebook would like a piece of the pie and it’s already going for it.

You know all those “Like” buttons Facebook’s splattered all over the Internet?

It turns out Facebook is using them to building a hierarchy of Web pages, similar to the way Google uses the way Web pages link to each other to determine “PageRank.”

Every time a Facebook user “likes” a web page, that page will from then on show up in Facebook search results.

AllFacebook’s Nick O’Neill describes this as a “full scale attack on Google on all fronts at this point as Facebook has officially entered the internet search market.”

We think he’s right. In fact, along with payments and brand advertising, search advertising should eventually be a big revenue stream for Facebook.

But it won’t be anytime soon. The reason? Facebook search results – compiled by Facebook users – are still very, very poor. Especially when compared head-to-head with Google’s, compiled by Google’s computers.

Here are some key questions / thoughts to assess this search opportunity…

1) What percent of US and global searches are now conducted on Facebook?  Facebook already has good search, via Microsoft, and if no one’s using it that means facebook will have to change people’s habits.  So far, that’s been damn hard to do, even when people are hanging out on your site all day (look at yahoo).  Last I checked, facebook had about 2pct of US searches despite being by far the biggest in terms of time on site.

2) Facebook can easily license a decent search engine (including bing) and factor it’s “like” weightings into the SERPS.  So they could fix the search part fast if they wanted to.

3) As yahoo and Microsoft have learned, there are huge scale advantages in search.  Google is the only “must-buy” and it’s revenue per search is therefore vastly higher than Yahoo and Microsoft.  Unless Facebook takes a huge share of the market, the same will apply.

So, basically, I think facebook seriously making hay in search will require a lot more than good search results.

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