smartphone

Facebook Daily Active User Count Drops, But Stock Values Go Up

mark zuckerberg

Facebook has made some great changes over the last couple of months, but what’s interesting about all of this is that Mark Zuckerberg is bragging that people are spending less time on the platform.  In fact, he said that Facebook users spend 50 million hours less, per day than before.  Which Zuckerberg is viewing as an accomplishment.  Is this a good thing?  I think so.  Even Zuckerberg thinks that people should be spending less time on the platform, so yes, it’s a good thing.  Zuckerberg made this announcement as part of their quarterly announcements, by saying:

Already last quarter, we made changes to show fewer viral videos to make sure people’s time is well spent. In total, we made changes that reduced time spent on Facebook by roughly 50 million hours every day. By focusing on meaningful connections, our community and business will be stronger over the long term.

If you’ve paid any attention to what has been happening with Facebook in the last few months, this shouldn’t come as a big surprise.  One of their initiatives is to reduce the amount of misinformation that is appearing in your news feed.  Part of that includes reducing the amount of viral content including videos on the platform.  Rather, Facebook wants users to engage in meaningful interactions rather than just sharing content.

facebook

TechCrunch gave us some really interesting statistics.  They estimate, a drop of 50 million hours of use per day, roughly translates to about 2.14 minutes spent on Facebook per user, per day.  This takes into account the fact that Facebook has 1.4 billion users.  According to Zuckerberg, this is about 5% of the total time spent on Facebook.  While 5% doesn’t seem like a high number, but that’s significant changes in the last few weeks.

Facebook might be interested to know that their daily active users dropped by about 700,000.  Again, that’s a significant number.  Hopefully, this is merely a drop and not something that will become a trend.  Facebook has also reported the slowest quarter-over-quarter yet, in terms of daily user growth ever – at 2.18%.  Normally, it would be around 2.24% if those daily active users didn’t disappear.

But, like I said, Facebook isn’t worried. In fact, Facebook stock has increased by 1.4% after the announcement.  Part of Zuckerberg’s statement indicates that this model might be just as profitable as the previous model:

By focusing on meaningful interactions, I expect the time we all spend on Facebook will be more valuable. And I always believe that if we do the right thing and deliver deeper value, our community and our business will be stronger over the long term.

Overall, this concept is an interesting one to me.  It seems like Zuckerberg is turning the tables a bit.  Lots of people (myself included) seem to criticize Facebook for some of their recent practices.  Zuckerberg is kind of going on the defensive, in a way and saying – here we’ve made changes – what do you think?  And in fact, I would argue that this strategy is beneficial to Facebook.  They’re saying – look at what we’re doing/we’re listening to you – and that gives them an advantage in terms of being the social networking platform of choice by the masses.