Facebook Is 'Going To Disappear' Within 8 Years
By Wendy Hernandez
From The Huffington Post
Don't expect to find your Facebook inbox full of friend requests eight years from now -- it's likely Facebook is going to disappear. At least, that's the future according to Eric Jackson, founder of investment firm Ironfire Capital.
Jackson appeared on CNBC’s "Squawk on the Street" on Monday to discuss Facebook's inevitable demise and how web companies strive to evolve.
"In five to eight years [Facebook is] going to disappear in the way that Yahoo has disappeared," Jackson said during a phone interview on the show. "Yahoo is still making money, it's still profitable, still has 13,000 employees working for it, but it's 10 percent of the value that it was at the height of 2000. For all intents and purposes, it's disappeared."
Jackson described three generations of web companies. The first generation was dominated by websites like Yahoo, which aggregated everything you need to know in one place. Those big web portals, which Jackson dubs Web 1.0, were followed by the dawn of social networking sites, including Facebook. The current generation is composed entirely of web companies focused on monetizing the mobile platform.
Jackson said Facebook's struggle lies in a web company's inability to easily move from one generation to the next. Take Google for example. The web giant reigned supreme in Jackson's designated first generation, but struggled to move into the social networking realm, with several failed models. Google+ may be the most successful of Google's social networking efforts to date, but its more than 100 million active users still does not rival Facebook's astounding 900 million.
"When you look over these three generations, no matter how successful you are in one generation, you don't seem to be able to translate that into success in the second generation, no matter how much money you have in the bank, no matter how many smart Ph.Ds you have working for you," Jackson said.
In Jackson's view, Facebook cannot effectively create and monetize a mobile platform by simply buying up as many mobile apps as it can muster. Sure, Facebook can purchase Instagram for $1 billion, but that will not transform Facebook's core business model. At its heart, Facebook is a social networking site, not a mobile company.
"[Facebook] can buy a bunch of mobile companies, but they are still a big, fat website," Jackson said.
The bottom line behind Jackson's comments is that Facebook may be stuck in the social networking realm forever. And as we've seen with Facebook predecessors like MySpace and Friendster...