Facebook executives and their acolytes stimulate a lot of heavy breathing when they talk about strategy. With its 500 million-and-counting 'friends' Facebook is the China of the Internet; a vast market of relatively unrealized potential. Visions of sugar plums dance in the heads of marketing executives as they contemplate the riches to be plucked from this fat souk teeming with relatively affluent and eager souls. If only.
The challenge is that the vast gulf between strategy and execution. It is one thing to craft Powerpoint cloud castles in the sky; quite another to build the technology and the alliances necessary to realize the vision. In encouraging rampant growth, Facebook has followed the market. Given the results, that decision can hardly be gainsayed. But the market has moved in a curious direction, essentially expropriating the site for commerce-free interactions. Release of recent advertising results suggests the company has creatively tiptoed around the landmines of overt advertising appeal, using the 'Like' option to promote affinity that may have some sell-through potential. The reality is that no one knows what that click-through rate is - yet - and as a still private enterprise, Facebook is not required to release figures. So, how might the vision be realized?
Michael Wolf comments in GigaOm on the potential for Facebook to become the web's Entertainment Operation System, the Crossroads of the World when it comes to electronic bread and circuses. The strategy has its advantages: entertainment is less overtly business-y than selling products like eggs and laundry detergent, so it skates by the unspoken 'commerce free' ethos many FB denizens have adopted. On the other hand, it presupposes a breathtakingly vast assignment for a company that has not overwhelmed with the strategic genius or executional chops of its leaders. Bright, yes. Ambitous, natch. But is Zuckerberg the next Gates or Jobs? The polite response is, time will tell. Even if they could make it happen, are netizens really ready to assign all of their entertainment demands to one company? And what are Google, Amazon, the Chinese and a host other potential competitors going to do about it?
So, read on and judge for yourselves. Leave a comment if you are so inclined. The betting here is that the complexity of wiring all the elements together to achieve this audacious goal may be a bridge to the future too far. Convergence, yes. On Facebook? We'll see. JL:
"Earlier this week, when networking goliath Cisco all but confirmed it had shut down an ambitiously named Entertainment Operating System (EOS), I suspect some folks at Facebook may have chuckled quietly to themselves. After all, the big social network, which is reportedly in negotiations with all sorts of entertainment companies to integrate their services, may have designs on becoming for real what the Cisco product was only in name: a social entertainment operating system for consumers.
Okay, sure, while Facebook and its sign-on, presentation, app platform and commerce only represent a portion of what a true OS would be — as Tim O’Reilly points out so well — it is perhaps the most important and unavoidable layer of the Internet OS, one that consumers will increasingly go through to find, purchase and even consume their entertainment content on the social Web.
The growing importance of Facebook as a social entertainment layer is due to two main factors. First, the social Web is becoming the new EPG for a generation of consumers. Fading is the old-world model of corporate-programmed guides and tastemakers; ascending is a world where entertainment is personalized and social, and where much of it will be driven by Facebook.
Second, time and place restrictions on media are going away, making way for anytime, anywhere on-demand consumption across any screen. And as these linear models break down and anytime-anywhere media consumption rises, Facebook can become the recommendation and consumption layer that enables, organizes and make sense of the media chaos.
So which types of media will flow through Facebook? In short, all of them. Facebook has tackled certain content types with more gusto than others, in part because it looked to take on those media types with less complexity and lower licensing barriers. Photos — a content type to be sure but largely personal media — was the first media Facebook integrated (and dominated) in a big way. Gaming, in particular casual gaming, was the first premium content type that Facebook set its sites on; as a result it’s become the dominant social gaming platform by enabling companies like Zynga to create huge value atop the Facebook platform.
Over the past few months, it’s become apparent that Facebook is now looking to extend its platform to video and music entertainment services, capitalizing first on the strong adoption of Facebook Connect and, over time, possibly integrating the actual third-party services themselves to varying degrees.
To be certain, in the war of platforms for entertainment distribution and consumption, Facebook isn’t the only game in town. In many ways Apple already has a true entertainment OS in iOS, owning the entire stack from hardware up to application platform. Google is certainly a contender here as well, with Android and its strong adoption across many devices.
But it is Facebook, in becoming the indispensible and ubiquitous social layer across the Web, that occupies a unique position of attack in the battle to win its place as the social entertainment operating system.
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