Facebook rebounds from May slump despite Google+

Computerworld - After Facebook hit a wall and lost 6 million U.S. users last May, the social network has been slowly coming back.

In the past five months, Facebook has gained about 6,581,000 active U.S. users, according to data from Facebook's advertising tool and compiled by Computerworld, bringing the social network's U.S. user base back to just ahead of where it was before the decline.

At the start of May, Facebook had 155,200,000 users in the U.S. A month later, the number had plummeted to about 149,400,000.

Since then, the Facebook user count has risen to 155,981,460.

Ironically, Facebook's rebound began as Google entered the social networking business with Google+.

"They have a saying in the stock market -- 'Nothing grows to the sky'. This applies to Facebook, and other social networks too," said Dan Olds, an analyst at Gabriel Consulting Group.

"There's a limit on the number of individuals and businesses who are going to use Facebook in a significant way. At some point, the growth rate will be limited by economic and population growth. I don't think we're at that point yet, or anywhere near it. There's plenty of room to grow," Olds added.

Olds did note Facebook's massive user base makes it difficult to sustain past growth rates of 15 million or 20 million new worldwide users a month.

"If Facebook truly has 800 million active users, they're going to find it hard to grow the base significantly," he added. "To put it in perspective, to hit a 10% growth rate, Facebook would have to grab enough new users to equal the populations of California, Texas and New York. "

Brad Shimmin, an analyst with CurrentAnalysis, describes Facebook's rebound simply as the end of a temporary slump.

"The earlier downward trend, for example, could have been driven by a combination of factors, such as oversaturation in the U.S. market, where most of its growth had come from to that point," said Shimmin. "It also could have been a tipping point in negative opinion built from numerous past privacy blunders, the introduction of competitive alternative solutions, as well as many other such factors."

Olds noted that with a reported 800 million users, the temporary loss of 6 million in one region represents only a small percentage of the total user base.

Facebook's U.S. user numbers started to grow again in June, which is the month that Google launched its rival, well-funded social networking site, Google+.

"Google+ doesn't seem to be putting much of a dent in Facebook at this point," said Olds.

"This doesn't mean that [Google] won't or can't, but it does mean Google is losing precious time in its race to get some mindshare with social network users. While Google has the resources to do about anything it wants, the one thing they can't do is turn back the clock to a time before Facebook was the dominant player in social networks," he added.

Shimmin said it's too early to tell how the new social network will fare.

"From my perspective, Google+ is still undergoing the typical peak-and-valley associated with new offerings," Shimmin said. "I don't think we'll be able to assess the health of this service until it has further matured, entering the enterprise marketplace, for example."

Sharon Machlis and Ken Gagne of Computerworld compiled the data on which this report is based.

Sharon Gaudin covers the Internet and Web 2.0, emerging technologies, and desktop and laptop chips for Computerworld. Follow Sharon on Twitter at @sgaudin, or subscribe to Sharon's RSS feed . Her e-mail address is sgaudin@computerworld.com.

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