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Facebook, the flaws of the empire

Facebook CEO Mark Zuckerberg (from the back) at the official announcement of the group's name change to Meta on October 28, 2021.

Among the internal Facebook documents leaked in October 2021 by whistleblower Frances Haugen, one element went relatively unnoticed: the fear of the social network and its subsidiary Instagram of being overwhelmed with young people and get outdated by TikTok, the champion social network for short videos. “On Instagram, the content is not as funny and interesting as on TikTok. What’s there is often quite basic and less fun, and there’s a lot of copied content.” asserted a teenager, among the 35 users questioned as part of a study, published in April 2021.

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In another document, dated March 2021, the authors noted trends “concerning” : “TikTok has doubled [en 2020] its time per user and teens spend two to three times more time there than on Instagram” ; “Migration of teens from Instagram to Facebook is minimal”; Facebook users born after 2000 visit more frequently, but “shorter and superficial”…

On February 2, these confidential torments became a public reality. For the first time since its creation in 2004, the social network Facebook announced that in the fourth quarter of 2021 it lost daily users (one million people). A drop of water among its 1.93 billion users or the combined 2.82 billion of Facebook, Instagram and WhatsApp. However, the specter of decline also hovers over the three networks of the company, which has been renamed Meta: they have only gained 10 million users in three months.

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Combined with advertising results deemed disappointing (+ 37% in total turnover, to 118 billion dollars, or 107 billion euros, for 2021, but + 20% in the fourth quarter), these figures earned Meta losing 26% of its value in one session and seeing $251 billion in market capitalization go up in smoke. A record in the history of the Stock Exchange.

“Facebook is dying” wrote the Protocol news site in early February 2022. Attacked on the ground of ethics since the election of Donald Trump in November 2016, Mark Zuckerberg’s company today shows flaws in the business. “Its economic model has taken an uppercut”, summarizes Daniel Ives, analyst at Wedbush Securities.

The TikTok threat

For Meta, the first front is linked to TikTok: what to do with the explosion of short videos, lasting a few seconds, popularized by the Chinese network? Faced with analysts, Mark Zuckerberg wants to be reassuring. “We have already successfully experienced transitions: the passage from the Web to mobile, then from the news feed [qui classe les contenus sur la page d’accueil d’un utilisateur Facebook] to stories”, he says. Noting the rise of Instagram, then WhatsApp, Facebook had bought them. Then, faced with the success of Snapchat’s “stories”, the group had copied this format of vertical videos of a few tens of seconds. To counter TikTok, Mark Zuckerberg now relies on Reels, his home replica of short videos, deployed across Facebook in February, and present on Instagram since 2020.

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