Killing Facebook
Zuckerberg is currently participating in the single-most expensive attempt to manifest reality and painfully failing. He is a nakedly awful ruler that can never actually be fired, meaning that he can burn this company to the ground if he sees fit.
Capital Thinking • Issue #1142 • View online
As I’ve written before, I do not think much of Mark Zuckerberg as a CEO.
In the most charitable interpretation of the events of the last ten or so years, he has overseen a company grow from “catch up with what your friends are up to!” to a discordant social network experience where algorithms constantly attempt to trick you into doing stuff.
It’s fair to say that Instagram and Facebook have become platforms that use their users, with your feed feeling like some sifting through cat litter for whatever nuggets of whatever it is you logged on to see, a thing that is becoming increasingly hard to remember.
Mark Zuckerberg Is Going To Kill His Company
And things are getting worse:
Meta just reported its third quarter earnings, revenue decreased 4% and active users increased 4%. Stock is down 7% on the news.
— Alex Heath (@alexeheath) October 26, 2022
“We do anticipate that Reality Labs operating losses in 2023 will grow significantly year-over-year”
Zuckerberg to critics: pound sand
How do you increase active users yet decrease revenue? Very easily: by turning your previously-beloved social networks into social engineering traps.
Meta has successfully taken two products that people liked (and the only two products that made them any real money) and, in their desperation, tried to wring more money out of them by annoying their users into submission.
The obvious problem is the one they’re currently facing, which is that the only way to make more money is to make the products significantly worse, pissing off users old and new, which will, in turn, mean advertisers reach fewer people, which will make Meta more desperate, which will mean the algorithm will continue to pump irrelevant crap into your feed.
This will, eventually, mean that many people will stop using these platforms entirely.
But really, what is the reason to go on Facebook or Instagram these days for the average person?
These experiences were never transcendent other than the fact that almost everybody is on Instagram or Facebook. Meta has likely overestimated exactly how powerful the value proposition of these platforms is and underestimated how powerful the effect of interfering with it is too.
We then get to the inevitable conversation around Mark Zuckerberg’s metaverse, one of the stupidest things I have ever seen a company pursue.
Reality Labs (the metaverse department of Meta that is tasked with spending and losing as much money as humanly possible) lost $10 billion in 2021 and, “[anticipates] that [their] operating losses will grow significantly year-over-year.” This comes two days after Meta shareholder Altimeter Capital’s CEO Brad Gerstner said that Meta should cap spending on the metaverse at $5bn a year and that “people are confused by what the metaverse even means.”
As funny as it is that Zuckerberg responded to “don’t spend as much money on the metaverse” with “I will now spend more on the metaverse,” anybody with half a brain can see that he is burning his company to the ground.
Zuckerberg is experiencing peak founder-brain - that previous success begets future success and that has had several good ideas means that every idea you’ll ever have is perfect.
And that’s the ultimate con of Mark Zuckerberg. He is a liar and has created very little.
Every major product that Meta sells (other than Facebook itself, and even then…) was acquired - FriendFeed, Friendster, Beluga, Instagram, Oculus, Face.com, every part of this company is some taped-on acquisition.
It worked for a while, but no part of this narrative suggests Zuckerberg is the true architect of this company’s success.
He is, however, clearly the architect of its destruction.
Ed Z