Facebook Announces its New Game Plan

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A press release at the company’s headquarters is expected to reveal the company’s new social networking plan to the world. Investors who were once leery of Facebook’s teetering market value several months ago are now waiting on the edge of their seats to see what CEO, Mark Zuckerburg, will have up his sleeve to move the company forward in 2013. There are quite a few rumors already swirling around on the Internet as to the details, of which the following three are getting the most attention:

A Facebook smartphone

The release of a Facebook smartphone has been the topic of discussion on and off again for several months. With the exception of the iPhone launched by Apple, smartphone hardware, in general, has many limitations as to what it can do for Internet companies. Perhaps, it would be more advantageous for Facebook to follow a course of action as Microsoft or Google – offering an operating system or solutions apps — this is a much simpler way to broaden their horizons just based on their huge popularity with the average consumer to make greater profits. Moreover, other hardware vendors could use Facebook’s brand as a marketable tool in the smartphone universe.

There is strong skepticism, however, about whether or not an operating system will ever come to fruition. There are several rivaling companies all vying for that third operating system position – the recently announced Firefox OS, the soon to be released BB10, from Research in Motion (RIM) and Microsoft’s latest mobile OS are all in hot pursuit of Google’s Android and Apple’s iOS. Is it possible that Facebook could one day launch a branded device built by a company like HTC or another company in the near future? Realistically, it’s a stretch.

Integrating a video service with Instagram

In September 2012, Facebook completed its ownership of Instagram, the widely used mobile social network that links to Twitter and Facebook. Attaching video to a platform belonging to Instagram would be a clever strategy by Facebook to allow its more than a billion users to capture and share video with an Android, iPhone, iPod or iPad.

The extra perk of integrating video with Instagram, is that it offers unique advertising capabilities opposed to photos. Videos posted on Facebook could be formatted very much in the same way as those found on Hulu and YouTube commercials. The merger of a wildly popular platform like Instagram with live media would cause many analysts on Wall Street to possibly adjust their price targets on Facebook shares as well as revisit their earnings and revenue predictions which, in itself, gives a glimpse of Facebook’s impact on social networking if this features alone were added.

A Facebook search engine

Because of the number of existing search engines present in the market, speculations of Facebook coming up with their own search engine seems to be more of a whimsical notion than a reality. Presently, Google dominates the market at 66.7%. Right after Google, Microsoft Sites account for 16.3% and Yahoo! YHOO) Sites hold at 12.2% of search engine traffic. There are also other search engines players according to comScore(SCOR)reveals that both hold notable share rankings since December 2012:

▪ ASK Network (IACI) – 3.0%
▪ AOL, Inc. (AOL) – 1.8%

Can Facebook actually build a search engine? It makes sense. Facebook already has a page where users can locate “people, places and things” in its search box. Moreover, Apple, who shares a close relationship with Facebook would likely benefit from a Facebook search engine; since they have no plans of developing a search engine of their own. Having an alternative to Google that is not a Microsoft product is sure to be a good fit for Apple’s Mac products and iOS devices.

Would Facebook making this kind of move be a threat to Google? After you consider the combined market shares of Yahoo!, Microsoft’s Bing, and AOL’s IAC/Interactive, it could cause a real upset. comScore’s figures of Google’s market shares reveal that the tech giant lacks roughly 33% of the online search engine market in the U.S. Based on these statistics, Facebook could reasonably steal away traffic Google and other search engines’ now have, since it has the capability of incorporating search results based on social feedback — web users would get to see how how many people “Like” content, products or services within their social circles, which could prove more informative and beneficial than just seeing a list of top ranking websites generated by Google’s algorithm.

A search engine offered by Facebook would be designed to do one thing – generating limitless revenue. There is even talk of a Facebook dating site. As always, change brings on resistance. Some are already chafing at the bit just at the thought of Facebook controlling every aspect of their lives. Others would welcome any enhancements offered by Facebook to make their search engine experience better. Whatever changes the company announces today, users and marketing analysts should expect some type of shift in Facebook’s presence on the Internet one way or another.

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