Ronnie05's Blog

Facebook: Of 500 million users, and the next 500 million

Posted in Social context, media and advertising by Manas Ganguly on July 22, 2010

Half a Billion! That’s the number that Facebook has released as its latest update on active users. 500 million users is not a mean achievement and Facebook is promoting the feat with its “Facebook Stories” user testimonies. Facebook started out as a networking tool for US university students. In its conquest of the global audiences Facebook adopted native language avatars and the impressive growth has continued unabated.

Who will be Facebook’s next 500 million?

With 500 million users, the next question for Facebook is: “What Next”? Growth in native US seems to be plateauing and the penetration across Mid East, Latin America and Europe is at percentage point 60s indicating further high growth may be difficult to come by. Facebook has a lot of room for growth in Asia pacific region which is the next focus area for Facebook growth. Then there are pockets in Europe, Lat Am and Japan-Korea which have a very high head room for supporting growth of Facebook. In all, international users comprise about 70% of Facebook’s total user base and the figure will grow exponentially with the roll outs in Asia-Pacific.

There is definitely a path to a billion users for Facebook, but how long it takes will depend a great deal on its strategy to spur adoption in some of the larger, low-penetration markets. Making a push in India right now is an example of going after what is still relatively low-hanging fruit for Facebook as a large and growing market with room for continued penetration that does not have significant cultural barrier to adoption.

The way to larger low penetration markets is Mobile

Facebook is already engaging leading smartphone and feature-phone makers to engage mobile audiences through Facebook Connect. Facebook has a direct and a very relevant match between its service and USP and mobility. Operators would also see Facebook Connect as a means to drive up data traffic. Thus even as growth in US markets is gradually leveling out, Mobility experiences in social networking could be the growth engine of Facebook in Asia Pacific and other low penetration markets.

(The Facebook credits program has a internet-transactions redefining scope and this could be a strategic direction towards a global currency. Discussed in next my post)

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