tl;dr or Summary: I have argued for some time that Facebook is going to be disrupted: Facebook was the huge winner of Web 2.0 but doesn’t really fit the mobile age. They still have the advantage of a huge user base, but the primary functions of FB — photo and video sharing or text communicating — are better performed on smartphones by specialized apps developed for mobile. In my opinion, the purchases of Instagram and now WhatsApp is an acknowledgement that Facebook itself shares that vision!
Disruption: The model of disruptive innovation (Clay Christensen) is a new platform, technology or business model that results in a new product or service that seems more basic than the current market leader. The market leader ignores the new product/service too long and it evolves to become the new market leader. Think Mainframes/minis/PCs or the array of memory devices for computers…
Mobile is a new platform. Instagram or Vine are more basic than FB but are better as sharing pics or videos on mobile; Twitter or the more basic message apps are better at texts. Already I see my students moving from FB to Instagram, Vine, Snapchat and Twitter…
According to the model Facebook should be overwhelmed by some combination of Instagram and either Twitter or a more simple message service like WhatsApp. The big twist here is that FB has acquired Instagram and now WhatsApp before they ate Facebook’s lunch.
I hate to say it (in fact I REALLY hate to say it!) but if I am right this makes Zuckerberg a truly exceptional business leader. One of the factors that makes disruptive innovation so deadly to traditional market leaders is the unwillingness of the leaders to self-cannibalize their existing business. IBM had to send a team to Boca Raton, far away from headquarters, in order to even get a foothold in the PC business… Blockbuster held on to their stores…
Zuckerberg is, in my opinion, investing heavily in companies very well-positioned to take Facebook’s business. Exceptional!
(I have a theory of a large niche market that Facebook will eventually be limited to… I will write about that in a later post…)
What is YOUR opinion:
- Are WhatsApp and Instagram the future of what WAS Facebook?
- Is Zuckerberg the truly exceptional leader who embraces disruptions?