Zuckerberg struggles to name a single Facebook competitor
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Disclaimer: I hate Facebook and twitter and Pinterest and Snapchat and whatever the hell else and have no personal investment in this whatsoever. I'm listing purely for the entertainment value of watching zuck squirm.
Microsoft's competitors are Apple on the hardware and software front, Google on the search engine front, Atlassian on productivity tools front, GitHub on the repository/code storage front, AWS on the cloud storage front, etc. I assume Microsoft's core solutions are their OS, their productivity tools and cloud.
Google's competitors are Yahoo, Bing and Duckduckgo on the search front. Garmin, TomTom and others on the map front, etc. And perhaps everyone on the email front. Here I assume Google's core tools are search, email, and maps.
Facebook's competitors are... Instag- oh right. Uh, Snapchat, I guess?
Google on the ads front.
Telegram and Apple (iMessage) on the IM front. (Not sure this one really counts, though. Is IM a "front"?)
The answers you gave for MS / Google would have gotten the same kind of interruption from the senator.
Yahoo and Bing are not significant Google competitors. They aren't even independent — Yahoo search is Bing.
As a social media user, you're not the customer, you're the product.
Take a look at all of the companies where a court determined that the company abused its monopoly power.
Every single one of them had "a myriad of other players" in the market.
So the existence of other players doesn't mean that Facebook doesn't have market power, it doesn't mean that FB isn't a monopoly, and it doesn't mean that FB can't abuse its market power.
Only a few hours ago, jwz (who blocks links from HN - fwiw, we are HN products) at https://www.dnalounge.com/backstage/log/2018/04/10.html wrote:
> Advertising anywhere that is not Facebook simply does not work. We keep trying and keep getting nowhere.
> We hear that from other promoters and venues, too: everyone says "Yeah we only advertise on Facebook. Nothing else does any good."
> I hate that this is the case. A lot.
This is the sort of comment you see if a company has market power, where switching to other players is not an option.
On one layer, they offer a social networking site to people, who become users. Then they take the information and sell it to advertisers to make money. Without the social networking site, Facebook wouldn't have its advertising business. There are more, I'm sure (governments are sometimes customers, for example).
There is only light competition for the advertising right now, but I'm going to guess we'll figure that stuff out as time goes on.
As far as the social networking itself, there are options, but none that can replace facebook's user functionality. There isn't anywhere robust enough to make change feasible. Instead, you can replace parts of facebook with other things and get partial functionality Your mother probably won't download a weird app just to talk to you instead of using messenger, for example, and your sister probably won't send you the pictures of the kids as often.
Facebook is defined by a single product, more so than even Google or Microsoft.
Facebook competitors are literally every other company that is trying to sell advertising.
Its much more nuanced. Advertising offered by facebook is VERY different from advertising slots during Superbowl.
If I start an advertising company which charges advertisers a blanket $1 per year, I don't affect FB's market power, because I don't have the same reach or same targeting capabilities.
Standard Oil's competitors might have been every other energy-provider company, but that doesn't detract from Standard Oil's market power in subsets of the energy-provider field.
Facebook's competitors might be every other advertiser, but that doesn't mean Facebook is immune from charges of abusing its market power.
I bet also that Zuckerberg might have "forgotten" that, in mainstream common sense, Facebook is viewed as "a website and mobile app". As CEO, he is trained to view Facebook as a giant company with a diverse selection of products, not just as a website. So his perspective on proper competition might be quite different from Senator Graham's.
IIRC they all had ~5 minutes to ask questions. Not enough time to do a proper cross examination and it gives Zuckerberg the advantage (he can draw out his answers and play for time).
The only take away for me is that these senators are not even close to being capable of engaging MZ properly in debate.
Isn't their single product the Facebook website/app? Sure they sell ads but so does Yankee Stadium. From the consumer's perspective the stadium's competitors include Citi Field, not Google Adsense.
But in this case, Yankee Stadium sells seats, and Tv rights (that the station puts ads on)
This question, in this context, means something like "in the market where you have the most market power, who are your competitors"?
Competition law has defined what 'market' means for cases like this; see https://en.wikipedia.org/wiki/Relevant_market .
Facebook is overwhelmingly known for its social network and it's biggest competitor is probably twitter who problem has ~10% of it's customers.
The point is that none of facebook's competitors come even close to facebook's size no matter which portion of Facebook's core functionality you're talking about. Plus, facebook is not diversified in the way that SAP or Honeywell is.
But, while this is "how" they get information; twitter and facebook's business is actually in selling advertisements.
he asked for clarification. were they asking about tech companies, messaging companies, or something else (advertising companies and publishers? they never got to the other categories)
BUT had they been able to ask a clear question, they could have gotten to the point that he doesnt have many messaging competitors (wechat/snapchat/google/skype.) more importantly they could have gone a more standard protocol/decentralization approach and asked him about going back towards intra-messenger inoperability. should facebook messenger be able to talk to skype and hangouts? ALL email providers talk to each other (within reason) and if i leave gmail i can go somewhere else and CHOOSE not to email other people with gmail.
this question should have been about anticompetitive acquisitions and closed/open platforms.
If the boss wanted information, they could get it the normal way. The point of calling someone to testify before Congress is to embarrass that person, and that point is generally not well served by asking sensible questions.
Yes, there may be genuine concern and a desire to get something done, but that isn't going to happen in front of the cameras - it's going to happen in committee meetings and discussions.
What happened today was the political equivalent of WWE and just about as useful.
If Senator Graham genuinely wanted to know about Facebook's competition, there would be legions of staffers and thousands of pages of reports on it. If Senator Graham were genuinely not sure what to do about Facebook, there are exceptionally well-informed people in his office to summarize the landscape, the propsals, the pros and cons, and to debate the finer points, who are deeply familiar with everything AEI/Heritage/Cato/Brookings have to say about it, etc. because that's their full-time job.
By the time you hear a pointed question in the committee hearing room or a speech in a floor "debate" from a Senator, they've been over it with staff, decided on a position, and calculated the optimal move to present to the cameras. That you enjoy or agree with the thrust of this particular show has no bearing on the theatricality of committee hearings as a tactic. They wouldn't do it if no one enjoyed it.
It's not that politicians don't debate things in good faith. It's that they do it with and through staff (who are more like the people you find in high school debate than televised election debate), behind closed doors, and not on the floor.
- B: Admitting competition is bad for wall street, legitimizes them, and turns the narrative into whether that is true or not (you don't want that to happen either)
- C: The senator was obviously trying to bait Mark into saying that they have no competition... why? Easy anti-trust/regulation. He avoided that as well.
Mark took the most strategic path. Sure - it could have been delivered better.
I don't think monopolies are necessarily a problem that needs fixing, but call it what it is. Facebook makes decisions based on their understanding of dominance.
If you don't like Ford, you can buy a car that you can't drive on most public roads and even fewer gas stations offer you the type of gas you need.
The good outweighs the bad for me, but it hurts nonetheless. If you fare better, all the more power to you, but do note: out of sight, out of mind. You may not fully realize what you are giving up by not having a digital social network, from not being able to use Tinder, to more serious stuff, like not knowing a childhood friend has died.
Not being on social media is the equivalent of not having a mobile phone 10 years back. The "essential"-part of Facebook (and other companies, like Google) actually plays a role in European directives. It is why Google has to clean its index on request, and a small niche search engine does not have this responsibility.
The only benefit was reconnecting with a former exchange student we had hosted, luckily she already had Signal! Besides that, my feed was just tales of woe from people I used to have a coincidental connection to.
Perhaps I'm an oddball, but my SO is banned from Facebook (real name policy), parents consider Facebook to be spyware, and extended family has held it in poor regard (not of my doing surprisingly) for a decade thus far. Getting lots of pressure to join a Mastodon server though, seems the extended family is all on that. Not what I'd expect from a bunch of mid-westerners!
And to amplify the impression to mention "Putin" somewhere.
That might stop all further questions to Mark.
Or even start procedure of canonization [1] of fb.com in general and Mark in particular by Congress.
Although the music integration is better.
I meant VK.com is visually and functionally similar to Facebook (because it started as a clone).
Now if you live in a Russian-speaking country, it's unusual not to have a VK account.
Senator: "But that is just for advertising. What about competitors for your customers that use the social networking product?"
Zuckerberg: "Oh them. They aren't our customers, they are the product."
We do not need these ignoramuses making decisions about social networking technology. They're as clueless as it gets. We just need users to become aware of the value of data privacy and then demand it. Technology will deliver.
I'm not worried because I think users will support the right things in the end.
- Social media platform (you are the content).
- Advertisers pay for eyeballs.
- Hashtags and groups collect similar users.
- Privacy settings control who sees your content.
- Text, pictures, videos, & polls.
- People leave Facebook for Twitter, & vice versa.
I'm not sure why he didn't just say "Twitter". In some very abstract way, Facebook overlaps with Apple. But that wasn't the question. The spirit of Lindsey Graham's question was to determine if consumers have a choice, and the answer is yes, they do: Twitter.
While this may or may not be true, part of Graham's job here is to make sure that the meaning of his questions can be ascertained by the actual wording of the question with no interpretation required, unless he's intentionally trying to confuse Zuck or get him to misspeak.
If Graham wants to determine if consumers have a choice, he should ask consumers if they have a choice. I'm sure the fine folks of South Carolina would be glad to help him out with that one. That would get him a more accurate answer than asking Zuck's opinion on the matter.
Any guesses on who sells bottled tap water for a huge markup, and who is part of the marketing effort to convince us to buy bottled water?
(Blame is not solely on C-C of course. Look to the Spectrum Stadium as an example of what happens when water is seen as a profit center, not a basic necessity.)
If you don't want to use roadways, what is the alternative? Flying? Railroads? Boats? Other roadways?
I get where the senator is going with his questions but there are plenty of alternatives out there, just no one wants to use them.
To quote the senator - "If I buy a Ford, and it doesn’t work well, and I don’t like it, I can buy a Chevy." but to put that into perspective here - "If I buy a Ford, and it doesn’t work well, and I don’t like it, I can buy a skateboard with two wheels."
> LG: Are there any other social platforms that reasonably compete with Facebook?
> MZ: Don't really want to say no because that's clearly a monopoly, but don't really want to cop to our core business being a data farm and not a social network, so... here is some convoluted non-answer.
> LG: Didn't expect that to be a stumper....
As such it competes with other advertisers: e.g. Google, TV broadcasters, et.c.
The fact that it does this using a "social network" has nothing to do with the question!
If FB were to change its fees or policies, can 5%-10% of the advertisers who are currently using FB switch to Google, TV broadcasters, etc. to get a roughly equivalent service?
If not, that would suggest FB is also in a more specific market than 'advertising', and has market power in that market.
duh
I miss google buzz.
Go to a high school and you'll notice that young people are more on Instagram than Facebook.
I'm not being flippant.