The ancient Roman Cicero said that “to be ignorant of the past is to forever be a child.” This seems an apt reminder for times when even recent history is ignored. As the Facebook retreat on Places and Daily Deals shows, it’s not the unstoppable juggernaut many believe it is. It is true that Facebook reaches more people than almost any other vehicle in the world. As such, marketers would be foolish to ignore it. At the same time, those with a long-term view would be foolish to assume it will continue to dominate the digital landscape.
The certainty of that statement doesn’t come from any brilliant strategic analysis, but only from history. In the past 15 years, there has been a steady historical record of supposedly dominant players overcome by the unceasing pace of change. Starting with Netscape, and continuing through Yahoo, AOL, and MySpace, the pattern repeats itself. A new player establishes itself as the hot thing, rises to take over the dominant position in its category, and investors and pundits alike point to its widespread adoption as an insurmountable barrier to competition. Until it isn’t.
So what will replace Facebook and when? No one can know. But given the trends, you can make a good guess about where it might come from. The rise of the web has been an exercise in disintermediation, or in non B-school terms, the elimination of the middle man. Google has done that with content. It used to be that content and distribution were linked. If you wanted to find content (TV show, magazine article, etc), you had to go the content provider (CBS, Esquire, etc). Google let you find the content without going through the provider. They effectively decoupled content and distribution. YouTube, Hulu, and others have extended that separation. I can consume content without ever visiting the its source.
Right now Facebook links three things: distribution network, content creation and content consumption. In other words, I have to use Facebook if I want to manage my list of friends, if I want to share something with them, or if I want them to share something with me. This combination makes it the hub of social activity. It makes it the second most visited site in the world. That traffic provides its cultural currency and its commercial reason for being. Yet you can already see the potential for disintermediation. Social network consoles show a future where content creation and consumption are separated from the distribution network. Yonoo, Digsby and others let users bring content from several source into a single dashboard. It points to a future where I never have to be on Facebook in order to use Facebook’s distribution infrastructure. The same way that content sites get demoted to just something Google can scrape, social networking sites could become just feeds for the consoles. And if it does not already exist, it is not hard to imagine an app that manages your LinkedIn connections, Facebook friends, and Twitter followers in a single database that doesn’t require you to directly use their respective tools. If I can manage my content and manage my network without ever visiting Facebook, it becomes a conduit instead of a destination.
That may not be the way it plays out. But history says the digital barbarians are due to bring down the Facebook empire.
The Ryan Report 