Facebook Admits They’re Struggling To Monetise Mobile

Posted In Mobile Web - By Ryan On Thursday, September 29th, 2011 With 0 Comments

For years the buzz in industry circles has been ‘mobile is coming’. In 2011, mobile has arrived. It’s here. We’re living it. But monetising mobile is something many businesses are still trying to figure out, from the smallest startups right through to the multibillion dollar social networking behemoth, Facebook.

At Facebook’s f8 developer conference this year, mobile barely featured in the lineup. The only things that cracked a mention when it came to mobile were in reference to the activity feed, timeline and a couple of features. For a company defining the social future of 800 million people (350 million of which access the service via mobile), Facebook has taken much longer than expected to introduce an HTML5 interface (though Project Spartan has been on the cards for some time, and is due to be announced early next week) or an iPad app. The reason for their apparent disinterest? Money.

Facebook’s mobile site and apps don’t include any ads whatsoever. And they don’t support third party apps either. Between these two gaping areas of monetisation, all mobile activity is costing Zuckerberg’s company money instead of earning it – and rising by the month as their mobile destinations continue to grow in popularity.

A consumer mobility analyst at ABI Research, Aapo Markkanen, agrees that mobile is the missing link in the world’s largest social network. “Facebook doesn’t have a very good story to tell about mobile. It’s true that more and more of its users are accessing it from mobile phones, but at the same time Facebook hasn’t really figured out how to monetise them,” he said.

In attempts to light a fire in the mobile space, Facebook recently acquired Snaptu, a company producing mobile apps for feature phones. They also introduced Facebook Messenger, allowing users to send messages to each other directly, as an alternative to popular IM clients like BlackBerry Messenger (BBM) and WhatsApp. But neither of these initiatives are yet providing Facebook with the revenue they need to help feed their cash-hungry business.

Jed Williams, an analyst at BIA/Kelsey, expressed concern at Facebook taking so long to fully get behind mobile. “With social users migrating rapidly to mobile devices, Facebook is under pressure to deliver a compelling mobile experience that uniquely leverages the platform – it can’t wait too long. The fact that mobile didn’t play a more prominent role at f8 isn’t so much a commentary on how Facebook values the platform, but instead an indication that its strategy for a full-scale mobile platform hasn’t fully congealed,” he said.

If statements this week are anything to go by, it looks like Facebook has finally put some speed behind their mobile efforts. Erick Tseng, Head of Mobile Products at Facebook, said at an industry event this week that Facebook “will soon become a company where more than half of all our users will be mobile users” and that they’re “getting to the point now where the countries we’re going into don’t have many computers at all”. As for their long-term mobile strategy, Tseng confirmed that Facebook is working with several major mobile handset manufacturers to embed the Facebook experience throughout the phones’ operating systems: “Where we want to evolve to is a place where you don’t have to go into a Facebook app to make it social, it should be pervasive throughout”.

Pervasive, sure. But profitable (enough)? Only time will tell.

About - With at least 20 phones tucked away in drawers around the house and office, Ryan is a buy-to-try mobile consumer and loves playing with new handsets. Right now he's stuck on the iPhone 4.

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