February 20, 2012
/ by Lisa Denten
Photo courtesy of ideagirlmedia via Flickr
News of Facebook’s IPO spread like wildfire and people were quickly analyzing whether it would be the next Google or Groupon.
At this point, everything is a guessing game but it’s wise for users to be prepared and seek advice from those who can make an educated guess. Enter PCMag.com junior analyst Jill Duffy, and ReadWriteWeb social media writer David Copeland.
“[Facebook] has finally learned to not push out too many drastic changes all at once without much notice,” Duffy said. “Once it becomes a publicly-traded company, Facebook will have to tread even more carefully when it comes to rolling out changes because it needs to monetize its site and service, and show proof of that monetization. I would imagine Facebook will be very careful about introducing major changes moving forward, saving those for perhaps once a year, while continuing to make small changes somewhat regularly.”
Copeland agrees and says over time, Facebook may scale-back its changes instead of rolling them out at a record pace.
“In the past, they have launched changes that have been initially unpopular with users and they have had time to tweak them, roll them out incrementally or just simply wait out the user backlash until members can see the upside of the changes,” he says. “I’m not sure that happens when you have investors looking over your shoulder; stock markets require a faster response.”
Copeland doesn’t foresee Facebook shifting to any kind of paid model for fan pages or personal pages, although he also notes, “never say never.”
“Facebook’s success is the result of, and ultimately relies on, user-generated content. As soon as you start charging people … you put the whole model at-risk,” he said. “That said, I don’t foresee them rewarding those users, like YouTube does by voluntarily offering to split ad revenue with creators of popular videos.”
Looking at post-IPO Google
Both Duffy and Copeland mention Google’s changes post-IPO, such as the way it interacts with users.
“Google has aggressively purchased other companies, developed new products and tried building new and experimental services from scratch,” Duffy said. “What’s interesting about looking toward Google for examples is that Facebook could, in theory, do what Google did and acquire other companies or spring forth new businesses while keeping its main service, Facebook.com, intact as it is now.”
Referencing the dot-com boom, Copeland says there were a lot of companies that had a culture change: employees have less incentive to work diligently because they are millionaires and some will look for other opportunities.
“After all, Facebook’s own COO, Sheryl Sandberg, did just that after Google went public,” Copeland said. “She left the company to join up with a then relatively small startup called Facebook.”
Copeland thinks the biggest change users will see is the inclusion of advertisements in Facebook’s mobile apps, saying the social platform needs to find ways to monetize mobile through advertising if it wants to live up to investor expectations.
Preparing personal and professional accounts
Duffy reminds users to clean up Facebook settings by taking a good look at apps, fan pages, groups and friends.
“Don’t let clutter build up,” she said. “The more unnecessary things you have hanging about, the more likely you are to receive advertising and messages that you don’t want. Keep your Facebook data manageable.”
Even though Facebook is a giant network that nearly everyone uses, Copeland advises people to watch for the next big thing, saying success in social media involves understanding the audience of each platform.
Who is next, you ask? Twitter and Pinterest come to mind but both Copeland and Duffy say it won’t be any time soon.
Duffy says she has heard a lot of talk about whether there is a new tech bubble, due to burst imminently.
“It’s scary,” she said. “I don’t necessarily discount that speculation off-the-bat. Facebook’s going public, if that were to burst the bubble, well, it would probably disrupt online companies around the world. It would probably affect non-Internet companies, too. My forte is certainly not economics but I think it’s safe to say that Facebook going public will be a make-it-or-break-it event.”
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