Facebook’s Home App: What’s In It For Facebook?

Download our full FB Home POV as a PDF by clicking here or read some excerpts below. 

What Is Facebook Home?

Facebook Home is a family of Facebook smart-phone apps wrapped into a unified presentation layer running on Android OS. It is essentially a launch-pad on top of Android’s locked home screen. It was made available on April 12 in the US on select devices. Facebook CEO Mark Zuckerberg emphasizes that Facebook Home is built around people, not apps, which he says means users can spend more time interacting with their friends and families on their smart-phones, rather than take unnecessary time to switch between all the apps that you have piled onto your Android handset.

Once installed, FB Home essentially replaces the standard Home Screen with a scrolling visual stream of full-screen photos from each user’s Facebook Newsfeed. Text-only posts also appear, using friends’ primary profile pictures (cover photos) as the image backdrop.

Insights about Facebook Home

There are several reasons Facebook launched Home the way it has:

Unparalleled value in home screen ownership: Owning the Home screen gives Facebook a tremendous amount of leverage in deciding what applications are presented, it helps them establish their mobile currency as the gold standard via “Facebook Credits”, it extends their relevance in the real world via location-aware locked screen alerts (a-la Apple’s Passbook), gives them access to a new pool of data to mine and develop unique products around, and most importantly it gives them a fresh canvas for ad monetization. FB Home gives Facebook the unique opportunity to reinvent mobile advertising at scale with endless integration and targeting possibilities.

Facebook as a new, mobile “walled garden”: Facebook is testing whether it has a shot at making the entire mobile experience its own “walled garden”. For years, wireless carriers decided what you saw on your device – this space was called the carrier portal “deck”.

  • Carrier “on-deck” real estate was incredibly valuable and it wasn’t until they had no other choice did they release the stranglehold they had on content as a core revenue stream (e.g. downloadable Java applications, ringtones, games, graphics, ticketing, cross-sell of services, packages for weather, horoscopes, sports scores, et al).
  • This paradigm shift happened in 2007 when AT&T, with subscriber numbers steadily shrinking and “switching” happening at a brisk rate in the wake of mobile number portability, knew it would be crushed if Verizon secured the exclusive on the iPhone. Left with no other choice, AT&T allowed Apple to commandeer the entire mobile device and content experience and stepped aside so we could finally meet the iPhone.
  • The iPhone removed the carrier (AT&T) from the equation almost entirely, with the exception of voice service and billing (for everything other than iTunes purchases), and reduced the role of the carrier to a “dumb pipe”.
  • This is not unlike what we saw happen in the ‘90s when AOL was nearly synonymous with the World Wide Web. Remember “AOL Keywords”? This obviously changed when users discovered the power of the broader Web via Search and Google, outside of the AOL walled garden.

Messaging & “Chat Heads” as Trojan Horse: While Facebook has become ubiquitous across the wired and wireless Web, with features like Facebook Connect extending its reach into would-be competitors’ environments by speeding the provisioning process when users download an application, signup for an email newsletter, or signup any recurring service – it has failed to become the messaging platform of choice.

  • Twitter, Microsoft’s Skype (and Windows Messenger before it), G Talk, iChat, ICQ, AIM and many others, have solid footing in this category. Not to mention the variety of enterprise clients and also consumer mobile messaging apps like What’s App (currently rumored to be Google’s next acquisition), Pinger, and Kik (a mobile messaging app with active monthly users approaching 50MM) preventing Facebook from gaining traction in this category.
  • For Facebook to sustain its user base, it must have a sustainable, fundamental utility built into it at scale – Chat Heads is the feature that would make messaging an “ownable” possibility for them.

Facebook Home on the iPhone was not an option for them, and it will remain that way: FB Home will never exist on the iPhone with an experience that even remotely resembles what it is today on Android. Apple will never give away the home screen on any iOS device for the reasons above, and also the simple fact it does not outsource or partner in creating compelling consumer experiences on its hardware.

Samsung & Facebook Joint Venture: A remote, however interesting, possibility would have Samsung and Facebook partnering in a deeper way that puts Facebook in the hardware business and give Samsung a point-of-entry in the social software space. Samsung must re-think their ad/media monetization plans, their content model, and the degree to which they can broaden their ecosystem and create a new, multi-screen platform open to developers. This would put them in a much better position to engage users on smart TVs and tablets – at the moment users/viewers are leaping over the Samsung “home” screen on Smart TVs and opting instead for Roku and/or Apple TV, Wii, et al. This scenario would give Facebook ownership of all of the “home” screens around us – Samsung TVs, tablets, PCs, and obviously mobile handsets. It would give them both the opportunity to deliver OTT video, social TV apps, and integrated messaging/chat/email and PIM across screens unified on a Facebook/Samsung multi-screen platform built for entertainment, utility, socialization and participation.

Facebook Home cover feed photo

Facebook generates most of its revenue from media sales. In 2012, Facebook scored a 36% growth in revenue, with approximately 9.5% of this derived from its mobile products. The mobile advertising industry is rapidly growing due to the aggressive shift from PCs to smart-phones and tablets.

It is estimated that spending on mobile advertising will reach $12.8BN and $24.5BN by the end of 2013 and 2016, respectively. Mobile advertising is creating new prospects for app developers, ad networks, mobile platform providers, specialist agencies and even communications service providers. Google currently dominates the mobile ad market with more than half of the entire market share. This is a direct result of its search platform, YouTube and Android.

A generational change is already signaling a decline in the appeal and perceived value of Facebook among youth, a demo Facebook has consistently relied upon.

In comparison to other social media sites among teens, Facebook still remains a winner. Business Week points out that Facebook’s popularity among youth has dropped significantly since the same time last year. Decline in usage could be attributed to, “so many parents and grannies that seem, creepily, to be all over Facebook these days,” Business Week says.

As teens migrate away from Facebook, they are arriving at niche interest app communities that include Instagram, Vine, Snap Chat, and Kik. A key disadvantage of Facebook’s Messenger feature is the lack of rich multimedia capabilities. Unlike popular messaging apps like those above, which let users share video and audio clips within real-time group chats, FB Home only includes group messaging, but the Facebook Messenger on Home will not have multimedia sharing features like these at launch.

[highlight]The appeal of FB Home 1.0 will likely be limited to fanatic addicts of Facebook.[/highlight] There is too little value and the Android OS is beyond compromised (e.g. modified menus, hidden apps) for most users to justify migrating to FB Home, even less likely these users

As mentioned, Facebook currently offers no advertising opportunity with FB Home. However, organic user activity does appear and so can, then, user activity related to brand social media programming (e.g. posts and activities on a brand’s behalf by users who are true brand fans and share because they care about their friends and the brands they love).

FB Home: Best Practices Moving Forward

  • Continuing to support brand loyalists with compelling offers and reasons to share
  • Like other social mobile applications with no paid media opportunities, if FB Home begins to scale or a compelling reason to uniquely target Home users surfaces, brands can leverage any of a number of engagement tactics:
  • Rewarding users for posting a brand-themed image as their main profile pic which would then be displayed within FB Home’s Cover Flow feature to their friends
  • Tagging a brand in a photo or pass-along offer, etc.

Note: This is a condensed version of our full POV about Facebook Home. Download the full version as a PDF here.

Jason Newport

Jason Newport is an accomplished Mobile, Digital, Social and Youth Marketing Subject Matter Expert. He is Head of Mobile Strategy at Aegis Media and also leads the 200+ member Reinvention Team, a global talent collective which draws on the massive resources inside and outside of the network to create modern, converged media solutions for clients. In 2013, Business Insider named Jason one of the Top 30 Most Creative People in Mobile Advertising.

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