You’ve got to hand it to Facebook. With the announcement of Facebook Home they may well disrupt mobile advertising and handsets in a really significant way. A very shrewd move.
Fair warning before I continue: I think Facebook is hell on earth. In my opinion embracing Facebook is like blindly handing all your personal paperwork over to a stranger (who appears to be well dressed and independently wealthy) that knocks at the door and hands you a message from a friend which you then read aloud together. Many times every day. It is even more insidious than Google, which is pretty tough. I suppose at least Facebook make products that more people want to use.
My personal distaste aside, I can’t help but marvel at the Home announcement because of its huge ramifications.
There’s the obvious effect on Google. If pretty much anybody with an Android phone can install Facebook Home this could be the beginning of the end of Google’s dominance and ad revenue. That is, at least, the small part that comes from Android as most is from Apple devices. A fact also reported by Opera . There may yet come a day when Google regrets its torching of the relationship with Apple.
MG Siegler has a piece on Home at Techcrunch which talks about spooning a bit too much but is interesting. A major takeaway from the post is that apparently HTC have added non-standard Android hooks that give Facebook Home deeper integration. This means more tracking of more activity. HTC have surely prostrated themselves this way in a desperate bid to avoid death in the mobile market in the next year or so.
Even as a Facebook cynic I can see that hundreds of millions of users will love Facebook Home if it is well executed. It doesn’t have to be smooth or particularly fast. For most people with cheaper Android phones they will not expect much polish. The Facebook website is hardly exemplary and this does not matter, it is always more a matter of what you can do and whether it fits your usage patterns.
The lure of top-level total immersion in Facebook will be a huge draw for many people. That is if Facebook’s star is not already beginning to wane at this point, and at least anecdotally in “the West” this may be the case. Total users are growing nicely but how many are really active?
Either way right now I think Google has a lot to fear from this. Facebook could even introduce their own search to kill Google. Right there on the home screen all the time. They have so much data from the graph about URLs and their relationships and value to users that this is very possible, especially if Facebook starts mixing in info about retail purchases and preferences.
A huge amount of media shared on Facebook must have come from Google searches in the first instance, not to mention Twitter, and yet when a user shifts this content link to Facebook it reduces Google’s revenue potential – especially when sites are so eager to adopt Facebook’s mechanisms for presenting content inline in the Facebook timeline. Twitter may see a similar effect. It’s no coincidence they try to discourage sharing between the two networks.
So you can expect Google to try to slam this open door very quickly. This would be controversial now, but not impossible.
What about Apple? I can’t believe this will not affect iPhone sales if it sees wide adoption on half decent handsets. It would be crazy to think that there aren’t a huge number of existing iPhone users to whom Facebook is a killer app. The existence of the Facebook app for iOS is testament to this. For those people who maybe have an iPhone for fashion rather than functional reasons, this could be a major lure away from Apple, if they are not too invested in the iTunes ecosystem.
Meanwhile, Samsung are busy building their brands and are presumably building their own new O/S or Android fork. They may not be interested in shipping Facebook Home on new devices right now but they are likely in a very strong position with Google and Facebook. They have apparently signed up to make it possible to install Facebook Home on existing high end handsets.
It is safe to assume both Google and Facebook will be offering Samsung a lot of money and other sweeteners to get the control of the “home screen” on future devices. Existing devices are pretty much a write-off because of the cost and lack of interest getting new Android updates to older handsets. This may be a big factor in slowing Facebook Home adoption, or conversely it may drive existing Android users with older handsets to upgrade sooner if it is really valued so much by users.
The user information and resultant ad revenue means that this home screen positioning is worth hundreds of millions of dollars to Google and Facebook. HTC probably received a big payout from Facebook to wire it deeper into the O/S, but perhaps not given their pitiful standing in smartphone market share. They might have begged for the opportunity in the hope of catching some early buzz among Facebook fanatics.
Recall that Google paid $10bn for Motorola alone. The home screen is without doubt much more valuable in the long term. Conversely Samsung may not want to tie its flagship phones that own the Android smartphone market to Google’s weak social offerings, nor to Facebook’s look and feel. They are investing heavily in the Galaxy brand. Google may not be able to offer any price that Samsung would accept, as there is a huge risk that a non-Nexus device that only works with a “Google+ Now Yoyo Shit Sandwich” home screen would bomb in the market. They are probably also not dumb enough to let Facebook be the UI skin of high end Samsung phones.
In summary, if Facebook don’t screw this up they could really change things. Facebook Home may even be compelling enough to shift buying habits away from Apple and Samsung. It could boost HTC sales and further nix Windows Phone and Blackberry unless they jump on board by opening up their O/Ses to Facebook. This risk alone is likely to increase pressure on Samsung to offer at least some phones with Facebook Home deeply integrated. Amazon is yet another wildcard. What if they cut a deal with Facebook too? Arguably this would make Kindle devices much more attractive to some customers.
It’s not something everyone wants, so the question is simply how many people do want this?
