Facebook loses users for first time in its history

Facebook loses users for first time in its history

Its business model is increasingly being eaten away by newer social networks and Gen Z's flight to these platforms.

Facebook says it has lost users. Could it be the beginning of the end for the network? (AFP pic)
PARIS:
Never since its creation has Facebook lost users from one quarter to another. This is now a reality for the social network belonging to the freshly rebranded Meta group.

As a direct result of this downward trend, the group’s share price has fallen by 22% on Wall Street.

And while the fall in users is far from extreme – with the loss of about one million active daily users in the last three months, out of 1.93 billion users – it reflects a real trend around the world.

The Facebook social network is clearly losing ground to competitors such as TikTok or Instagram (even though it too belongs to the Meta group), which are much more popular with young people.

If the reasons for this trend are numerous, the economic model of the network appears to be under threat.

Facebook is financed mostly by selling targeted ads based on users’ tastes or habits.

An update from Apple in April 2021 requires application developers to ask permission to retrieve user data.

For Facebook, this is linked to a considerable loss of revenue. Meanwhile, the number of daily users on all the group’s applications (Facebook, Instagram, WhatsApp, and Messenger) totals 2.8 billion people worldwide. A figure that remains stable.

On the financial side, Meta is still recording good results and acceptable growth (+11%).

Its revenue reached US$117.9 billion in 2021, an increase of 37% compared to 2020.

But since the introduction of its new concept for a virtual world, opening up a whole new field of possibilities, Meta seems to be accumulating setbacks, and, as it stands, no financial gains will be able to be drawn from this futuristic project for some time.

For the American group, this seems to be a warning.

If the network continues to lose users in favour of the future platform, it seems hard to see how it could recover.

Stay current - Follow FMT on WhatsApp, Google news and Telegram

Subscribe to our newsletter and get news delivered to your mailbox.