Oct twenty first 2021
WORTH NEARLY $1TRN, Facebook is the world’s sixth-most-valuable firm. Its revenues have grown by 56% prior to now yr, and its share value by greater than 1 / 4. Nearly 3bn individuals use its merchandise each month. Why would such a glittering success change its identify, because the Verge, a information web site, studies it plans to inside days?
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The possible official purpose for the rebranding, which Facebook has not confirmed, is that the agency has outgrown the social community that Mark Zuckerberg began 17 years in the past in a Harvard dorm. Today it encompasses different social apps (Instagram, WhatsApp, Messenger) and video {hardware} (Oculus, Portal). It has launched a digital pockets (Novi) and should but supply a forex (Diem). Mr Zuckerberg expects individuals ultimately to affiliate his agency extra with the “metaverse”, a digital area for work, play and extra, than with social media. This week Facebook stated it might rent 10,000 individuals to work on the metaverse.
If the Facebook community is to take a again seat, there could also be a case for regrouping beneath a brand new identify. Facebook wouldn’t be the primary tech titan to take action. In 2015 Google arrange Alphabet, a holding firm for the search engine and its many aspect tasks. Under this mannequin, Facebook would develop into simply one other app inside a wider household, albeit by far its greatest earner.
There is one other, much less flattering attainable motive for a makeover. For all its pecuniary success, the Facebook model has develop into tarnished. The social community is blamed for stoking every part from teenage anorexia to rebellion on the US Capitol. This month Frances Haugen, a former worker, advised Congress that Facebook was failing to average content material on its platform and protecting up a drop in younger American customers (it denies this). Public belief in it’s decrease than in most tech giants, and falling. Although two years in the past the agency began branding its apps as being “from Facebook”, its new “smart glasses”, which may document video and take cellphone calls, function solely the emblem of its associate, Ray-Ban.
Facebook buyers appear untroubled. But its social apps’ rising toxicity threaten to poison its different tasks. On October nineteenth Democratic senators signed a letter arguing that Novi and Diem needs to be scrapped, since “Facebook cannot be trusted to manage a payment system or digital currency when its existing ability to manage risks and keep consumers safe has proven wholly insufficient.”
Mr Zuckerberg himself has been a lightning rod for a lot of the criticism of Facebook, and of bossy tech companies extra typically. As the omnipotent founder, he has a better profile than his counterparts at TikTok, YouTube and different social networks. Normally, a model dealing with a reputational disaster may dump its unpopular CEO. But Mr Zuckerberg’s place is unassailable, which can clarify why he would wish to dump the model as a substitute. ■
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An early model of this text was printed on-line on October twentieth 2021
This article appeared within the Business part of the print version beneath the headline “About-face”
