Facebook Share Price: Social Network Developing Mobile Newspaper
Facebook Inc. (NASDAQ:FB) is developing a service that will display content from its users and publishers in a new visual format tailored for mobile devices, The Wall Street Journal has reported.
The idea behind the service, which has been in development for more than a year, reflects the inexorable push into mobile of the operator of the world’s largest social network.
The Facebook share price has fallen by about 4 percent to $23.54 in New York today, June 24.
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**A newspaper for mobile devices**
While it’s unclear when the company will be ready to unveil the product, if it ever is, the project, internally called Reader, is a good illustration of Facebook’s efforts to evolve from being a hub for users to interact with friends and classmates to a destination for users’ interests, increasingly focused on the mobile segment of the market, The Wall Street Journal commented yesterday.
Earlier this year, Mark Zuckerberg, the company’s co-founder and Chief Executive Officer said that he wanted Facebook to be “the best personalised newspaper in the world”. And it seems that Reader might be a step in that direction. Recent versions of the product resemble the popular smartphone and tablet application Flipboard Inc, which aggregates from multiple sources and lets users swipe to flip through articles, according to unnamed sources cited by the WSJ.
Flipboard and other similar services have become increasingly popular amongst users, with Flipboard alone having more 50 million users globally. Earlier this year, social networking rival LinkedIn Corp. (NYSE:LNKD) bought Pulse, another mobile news reader, for about $90 million. The company said that the decision had been in part driven by its desire to become “definitive professional publishing platform”.
Some analysts believe that it may be difficult for Facebook’s Reader to catch up with the competition, given the considerable lead that existing players in that area have already built, as well as aggressive efforts by Twitter and LinkedIn to push their own services.
“There are a lot of things people didn’t do on Facebook several years ago that they now do,” said Nate Elliot, a Forrester analyst, as quoted by the WSJ. “But I imagine it’s going to be very hard” to retrain consumers to see Facebook as a go-to hub for news.
**Seeing more ads**
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The Reader could also turn to be really beneficial to Facebook’s efforts to increase mobile ad revenue, an area that is seen as a key for the company’s long-term success. Facebook has made a significant progress there, with about a third of its revenue currently coming from mobile ads. Also, more people are using the social network on mobile devices, compared with a couple of years ago. However, most users’ interactions with the social network on mobile devices consist of brief sessions of up to several minutes.
The Reader project is a sign the company is trying to get users to spend more time with it on mobile devices – and to see more ads.