Facebook’s Home a Home Run?

Since last Thursday we finally know what it is all about the new ‘Facebook phone’: No, it is not a phone as a piece of hardware but it has the potential to turn many Android phones into ‘Facebook phones’. How? FB Home is a ‘skin built around the Android platform’. It replaces the typical cover screen and puts FB content first to the user (in technical terms it is a ‘launcher software’) with two core features in the spot light: “Cover feeds” show photos and captions from Facebook friends, messages and status updates float on top. Important: You can see all of that without even unclogging your phone. “Chat heads” is a new messaging interface integrating FB messages and SMS. Important: The messaging runs on top of all other apps so no more switching between apps when messaging.

So FB gave birth to something more than an application, and slightly less than an operating system. All of it puts the user in the focus, not apps anymore. Third party apps like Twitter and Google Maps are still there but they are tucked away and require a couple of swipes to access.

The first phone from HTC preloaded with FB Home will be available on April 12 through AT&T. On the same day you will be able to get FB Home in the Google Play Store for several Android phones including Samsung Galaxy S III, Galaxy S4, and Galaxy Note II.

These are most of the presented facts but how about first analysis and predicted implications?

– Mobile strategy: FB Home is the step to pivot from desktop and web (with right column ads) with 1+ billion users to phones and tablets, with integrated ads in the user experience. And mobile is the only way to get to the targeted 3-5 billion people (Zuckerberg).

– Reach & position: FB made the right decision in creating software instead of hardware: A great phone might sell 10 or 20 million units best which would only serve 1 to 2 percent of the FB community. FB Home has the potential to sit on most Android phone out there today and tomorrow putting FB right there on the home screen and all of its products at the forefront of the UI. And it didn’t require a lot of up-front capital or R&D investment.

– Experience: Home offers a deeply integrated mobile FB experience without having to give up the Android system people already know and love. It’s elegantly designed and seamlessly integrated into Android. Your whole FB experience is all right there on the home screen, one tap way.

– User demand: FB accounts for 23% of the time people spent on smartphones, Instagram adds another 3%. FB is regularly used on around 200 million Android devices. There is simply a big need out there.

– Google: From Google’s perspective there are good and bad news. Not good: Mobile means already less searches for Google because the behavior is around apps and we search less than on desktops (and mobile apps answer a lot of questions too). Now FB puts another layer of activity between mobile users and Google’s ubiquitous search box. Potentially good: After years of success, Android’s market share numbers dropped for the first time for a three months period in the end of February (53.7% to 51.7%) with Apple catching up (35.0% to 38.9%) in the US smartphone market (comscore data). FB Home might turn it around again.

Advertising: Last but not least. BIA/Kesley forecasts US mobile local advertising revenue will grow from $1.2 billion in 2012 to $9.1 billion in 2017. 54% will be location targeted ads and the FB Home will be a champion in tracking their users. It is going to know where you are, who you are talking to and when, even what app’s you are running. FB wants to know all of you because every little thing could transform into a click on some ads. And the idea of full screen photos automatically scrolling across user’s devices is particularly interesting for advertisers. At some point basic Page Post Ads, Promoted Posts and Sponsored Stories could be in the Home cover feed. But experts already see potential to offer more real-time, location-based advertising.

Closing with a statement of Robin Grant, global managing director of We Are Social: “Facebook Home could be the holy grail of mobile advertising. Aside from mobile operators, no other company is able to keep track of a consumer’s location at all times… features provide a potential mechanism to allow location-based ads to appear in a relatively unobtrusive way – something mobile operators can’t offer… it will effectively give Facebook a license to print money, their long sought-after equivalent of Google’s AdWords”.


Questions for the class:

– Who will install FB Home on their device?

– What challenges FB will face with FB Home?

– Do you agree with Facebook’s new statement calling themselves a “mobile first, mobile best” company?

– What are the consequences on the Apple ecosystem?

– Will there be an avalanche of other launcher software (e.g. Twitter)?









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