[codingkev]

Facebook is dying slowly in the developed world, that is true. However it is still growing in emerging markets. And most importantly: FB is still generating tons of cash to fund the other assets.

WhatsApp has basically zero monetization right now but billions of users. Huge potential cash cow.

Instagram still has a ton of potential for further optimized monetization. Think fully embedded 1-click buying for things like fashion, gadgets, accessories. They could take a decent cut of Shopifys business if executed right.

[cobookman]

The emerging markets *currently* do not have as large of revenue potential for advertising as the western markets.

Meta made in Q4-2020 53.56B in ad rev in the US and Canada. Meta only made 4.05B in Asia Pacific in Q4-2020.

https://www.statista.com/statistics/251328/facebooks-average...

[BbzzbB]

Emerging markets still shown slightly north of 30% YoY ARPU growth. Combine this with a larger user base (7x NA's, 5x EU's) and it remains an important lever, one to potentially outgrow NA's + EU's share of revenue. They in fact, lumped together, earn more than EU, and is not even one doubling of ARPU (proportionally) away of outgrowing NA. If the trends remain in like 5 years AP + RoW will be their core business.

[aylmao]

I largely agree with you, though I'm also rather skeptical.

> Facebook is dying slowly in the developed world, that is true. However it is still growing in emerging markets.

+1, though this is a slow and not necessarily viable bet. Meta makes about 12x more revenue from their USA/Canada ($52/Q) users than their Asia-Pacific users for example ($4.3/Q).

Market share in the USA is extremely valuable, not only for Meta, but for a lot of companies. Apple for example sits at a $3 trillion market cap in spite of Android dominating the global mobile market because iOS captures not the most users, but the most valuable.

> WhatsApp has basically zero monetization right now but billions of users. Huge potential cash cow.

I agree with this. I think there's a lot of potential in WhatsApp, though I also see two shortcomings with betting too much on it:

- WhatsApp is largely used in countries where users are harder to monetize. As stated above, user count matters, but it's not the only factor when it comes to generating revenue.

- Messaging is very competitive. A change in WhatsApp's TOS was widely reported to have triggered millions of new user sign ups on Telegram and Signal after just a few weeks [1]. I don't how accurate or overblown this correlation might be, but I do know anecdotally I text people through many different apps, and have switched the primary app I used to text different people multiple times in the last few years.

> Instagram still has a ton of potential for further optimized monetization.

I think this is still the most straight-forward path to increasing revenue Meta has, and I imagine they're trying to make sure it doesn't fade away like Facebook is.

[1]: https://www.theguardian.com/technology/2021/jan/24/whatsapp-...

[ElectronShak]

I feel like if instagram were to be driven further in the monetisation direction, we would no-longer have instagram, so someone else could innovate around photos, and take the still photo market.

I feel like instagram is no longer an actual photo sharing app, just a place where high profile users promote stuff to their followers.

[codingkev]

The last paragraph hits hard, very true.

[dahdum]

I think maybe they banked too heavily on getting their crypto Libra/Diem going in order to power monetization of WhatsApp/Instagram. It could have been as slick as Weixin/WeChat pay and dominate the cross currency remittance market.

[spookthesunset]

Except crypto is a pump and dump scam and most people know that. It was obvious from the start that libra was a “fellow kids” attempt to capitalize on the blockchain hype.

[dahdum]

I disagree, Libra had absolutely massive potential with Facebook, Instagram, and WhatsApp behind it. Stabilized by multiple fiat currencies it would hold value well, and it could power a global Venmo (via WhatsApp), capture a large portion of the entire remittance market, simplify e-commerce payments, and maybe even support micro transactions at scale. I’m sure I’m missing other large benefits.

The West is mostly so far behind on payment processing it’s a joke. Stripe charges 2.9% + $0.30 while WeChat Pay is 0.6% and Alipay .55%.

[spookthesunset]

What the hell would be it’s point? Why would it need Satoshi’s Holy Blockchain? Nobody in the mainstream consumer space wants an irreversible cryptocurrency.

Why not just use a database?

FB picking up Libra is just another loop in the blockchain’s solution in search of a problem.

[aylmao]

+1, though I imagine the motivation was probably skipping regulation related to handling international payments or something along that line. Riding the blockchain hype couldn't have hurt too (until it did, I guess).

[dahdum]

> Nobody in the mainstream consumer space wants an irreversible cryptocurrency.

Venmo and Zelle are both irreversible and mainstream but can't be used globally.

[notyourwork]

Sounds a lot like smoking cigarettes. Phasing out of the developed world and not the business is shifting to the innocent to milk the cow.

[Waterluvian]

I don’t doubt there are a lot of users in developing markets. Is there much money?

[donsupreme]

relying emerging markets in developing countries has a lot of inherent risk. For one they have to comply to the local data collection laws or risk being censored or banned outright. Developing nations either see FB as a tool to surveil or a foe to restrict information.

[kodemager]

> if executed right

I think this right there is the biggest issue for the companies that sell consumer data. Google has had so many golden eggs, office365 before Microsoft, the cloud infrastructure before AWS and so on, and they keep fumbling the ball because their organisation is geared toward a very different form of sales.

The fact that Instagram didn’t become an Etsy styled platform for artists when it was the main platform for sharing semi-professional “hobby” work should tell you everything you need to know about how little Facebook understands markets that aren’t selling privacy data. Because even if they opened up now that ship has sailed as less and less people who produce things rely on Instagram as a platform because the younger audiences aren’t there.

[umanwizard]

Facebook doesn’t sell consumer data. They sell ads which they target using consumer data. Not at all the same thing.

[hw]

Which begs the question - why not focus efforts on those, rather than bet the company on an unknown like the Metaverse? Is Meta getting too distracted?

[nabla9]

No. Facebook lost users globally for the first time in its history. This is probably the biggest take. Facebook has peaked.