On the other hand, I think that Zuck is demonstrating that he doesn't understand what the near future holds, based on the geopolitical upheavals we are seeing today. Facebook is going to need to change in order to grow, and Zuck has a specific mindset about privacy, and a nonchalance towards regulation, that probably won't jive much longer if he finds himself in a regulatory environment that actually intends to be effective at its job.
The mistake is compounded by the fact that he thinks that he knows better than those who vote overwhelmingly against him. Facebook needs a new tack, and he is stubbornly maintaining course.
Facebook can't really grow; that race is effectively over, there are no significant new slices of humanity for it to penetrate into easily. Something like one third of all the people on Earth have a Facebook account, and when you factor in Instagram and Whatsapp, they have just about all the users that there are to have.
Apple were a computing company until they weren’t.
Amazon was a bookstore until it expanded into web services of all things. I remember what an eye opener the success of AWS was too everyone on the outside.
Google was a search/ad company and yet that hasn’t precluded them from trying any sector to see if something sticks. With the move to walled garden apps which exclude Google from indexing them Google’s share price would’ve tanked if not for Android.
Netflix went from shipping DVDs to building a video distribution service and then a studio production arm. Big moves.
My point is these companies aren’t afraid to think outside the box. Facebook can do that. But they don’t. They seem comfortable buying other companies instead. What a Facebook pivot would look like I have no idea. Buying Instagram and WhatsApp were strong moves but Facebook itself isn’t making a lot of bet the farm type moves itself - at least not the way in which the other big tech companies are doing.
That would have been Facebook buying LinkedIn or GitHub.
The fact that they ceded both to Microsoft boggles the mind.
Facebook looks a lot like Microsoft of the 90s, obsessing over stagnant or slow growing business lines to the exclusion of new opportunities.
Whereas Amazon, Google, and Apple (to some degree) seem to realize it's expand or become irrelevant.
You can build a world-scale business on one great idea, but every idea isn't great. And a lot of successful companies forget they got a lucky roll on their first idea (by definition). Shotgunning and pruning >> all-in.
I think Microsoft of 2019 looks a lot more like Amazon of 2006?
Specifically, recognizing that for large, mature businesses, growth has to be driven by new product types that customers are demanding.
And that at that scale nothing starts off "big", but by observing metrics, demand, and properly incubating and then funding launches of internal projects, small popular services can indeed become huge revenue drivers.
Just spitballing, but as Facebook use declines I'd imagine their huge data center resources will become increasingly less utilised. They clearly have some incredible data center engineers (see https://www.opencompute.org/). FB could have made for an interesting AWS competitor. It would've certainly hedged their bets because right now unless Instagram/WhatsApp are utilizing capacity which FB's stalled growth is ceding I see them outsourcing data center operations to another vendor eventually.
There's so much potential in FB or was till very recently (Open Compute and React to name two very impressive projects) - I imagine employee retention can only have become harder as the privacy scandals have hit and the share price gains have slowed.
Facebook, as mentioned in parent comments, has essentially tapped out casual social networking as a growth driver.
But casual (e.g. your mom and uncle) is the key there. There are many other kinds of social networking: not as large, but large enough to be worth even Facebook's time.
Developer networking is absolutely a large and valuable demographic. Facebook has demonstrated competency is compiling and making social graphs useful.
Ergo, buying GitHub would allow Facebook to move into a new market while offering new features that GitHub couldn't build on their own.
(Note: I'm charting out an "If Facebook decided not to be stupid and just slap ads on GitHub" business case here)
The main asset that facebook has is data. I've been reading "21 Lessons for the 21st Century", and I agree with Dr. Harari's argument that we need a regulatory environment for data, and the way that the cultural/political swing is going, all it takes is one election to completely upend the value that facebook holds. I would go one step further and argue that actions that the US has taken in regards to China and Europe endanger facebook in areas where they will most want to be in the coming years.
What will Zuck need to do to survive and thrive in that? I don't know and I have a strong feeling that he doesn't either, but I'm guessing that he has some investors that do.
The mistake is compounded by the fact that he thinks that he knows better than those who vote overwhelmingly against him. Facebook needs a new tack, and he is stubbornly maintaining course.