At 10, Facebook strives not to be your granny's social network

Facebook defines social networking but must fend off the next big thing, teen boredom

Facebook, the company that defines social networking, is turning 10 years old and looking into a future where it must evolve or risk becoming the next MySpace -- a company Facebook eclipsed years ago.

The last 10 years have been quite a journey, not just for the people who co-founded Facebook, but also for the more than a billion people around the world who use the social networking site to connect with family, post photos of the things and people they love, and reach out to a wider world than the one in their own home or office.

The site started out as a simple idea in co-founder Mark Zuckerberg's dorm room at Harvard University. Launched on Feb. 4, 2004, the site was set up to help college students check each other out.

A decade later, Facebook has become the most popular social network in the world.

In its early days, Facebook came up behind social pioneer MySpace and quickly surpassed its rival. Facebook was too powerful, too popular, too fast growing for MySpace to keep up.

With a new and engaging user interface, a focus on building a social network of friends, instead of following, say, bands or movies, Facebook quickly went from being a MySpace alternative to being "the" social network. It was a snowball effect. People joined because it was the site their friends, family and co-workers were using. The more who joined, the more others were drawn to follow them into Facebook's pages.

Today, MySpace is barely mentioned in the ranks of the world's top social networks. Facebook, meanwhile, with its 1.2 billion global users, is far ahead of its social competitors -- Twitter and Google+ -- both online powerhouses in their own right.

"Facebook's meteoric rise was part brilliance, part luck and part timing," said Patrick Moorhead, an analyst with Moor Insights & Strategy. "Facebook perfected what MySpace started, cleaned up its messy design and made it simple... The public was ready to share their lives."

Despite its size and success, Facebook has had its challenges, particularly over privacy issues.

In 2010, federal lawmakers sent an open letter to Zuckerberg raising questions about privacy issues surrounding the revelation that some of Facebook's third-party apps, like FarmVille and Texas HoldEm Poker, were sending users' personal information to advertisers and Internet monitoring companies.

The site was also criticized for a bug that allowed spammers to harvest users' names and photos, sharing user information with third-party Web sites and having privacy controls that were too difficult to use.

Unprepared for the rush to mobile

Facebook also was caught unprepared for the massive push to go mobile.

When the company was preparing to launch its initial public offering in 2012, executives listed mobile as one of its biggest risks. The company had not figured out how to generate revenue from the burgeoning number of users who were accessing the site via their mobile phones.

Eight months after its IPO, Zuckerberg began referring to Facebook as a "mobile company." By that time, more users were accessing the site from mobile devices than from the Web, and more importantly, mobile accounted for 23% of Facebook's ad revenue, up from 14% the previous quarter before and zero from a year earlier.

However, while Facebook mades gains in mobile, it struggled much more with its highly anticipated IPO.

There was great anticipation about Facebook's IPO, but the company stumbled repeatedly in the months leading up to the launch. Zuckerberg met with potential investors in jeans and a hoodie, raising questions about his maturity. The company raised its opening price at the last minute and suffered a blow when General Motors, one of the country's largest advertisers, pulled a $10 million ad campaign days before its IPO.

With those troubles ahead of it, the company's IPO, despite the media frenzy, stumbled out of the gate. Its stock slid for months, hitting a low of $17.55 per share before rebounding to its opening price of $38 slightly more than a year after going public.

With Facebook on track with mobile, the company's shares have soared, closing Monday at $61.89 a share, Facebook is looking to its future.

As the company moves ahead, it faces new challenges, including boredom among its younger users and irrelevance.

The online market is a fickle one. Just ask MySpace.

Facebook has said that it's seen a decline in teenage users. During a quarterly earnings call this past November, David Ebersman, Facebook's chief financial officer, reported that the social network is struggling to keep teenagers' attention, though he also called the teen user base "stable."

It's not a new problem. As far back as 2009, a study released by iStrategyLabs showed that Facebook's U.S. high school and college-age users were on the decline even as its popularity among the 55-and-older crowd was booming.

The social networking site that cut its teeth on college-age users is now trying to figure out how to keep the attention of that same age range. Suddenly Zuckerberg, who became the world's youngest billionaire, is shepherding a company that may no longer be seen as the fresh, cool site.

Is 10 the new 50?

Can a site remain the top social network in the world if young users think of it as the site that their parents and grandparents use?

"There's this impression out there that Facebook is now your grandma's social network and isn't cool any more," said Dan Olds, an analyst with The Gabriel Consulting Group. "Youngsters and hipsters are supposedly fleeing the site for cooler pastures. But Facebook has well over a billion users and its size makes them the place where people still need to be if they want to have the maximum potential to be connected."

To stay relevant and useful, Facebook needs to continue its new focus of using large images, making it easier for users to post photo and videos to the site, and placing emphasis on local - local information and local deals.

The company also has to keep its wallet open to fend off or buy up the next big thing, much like it did when the company acquired Instagram.

"Facebook always need to contain the next big thing," said Moorhead. "Facebook bought Instagram to contend with Twitter's Vine videos. What about SnapChat? What will be the next big thing they have to deal with?"

If they can do all that, he adds that Facebook may still be the top social network in another 10 years.

Brian Blau, an analyst with Gartner, said Facebook may be able to remain the world's largest social network if it can bring people from underserved markets onto the site.

"If they could do that, they could very well be a much larger and more powerful company," said Blau said. "But even if that doesn't happen, or it takes longer than 10 years, I still think Facebook will grow during this period. They will continue to help connect people, and we will see them branch out into other types of businesses that can use social networking as a core part of their product or offering."

This article, At 10, Facebook strives to not be your granny's social network, was originally published at

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

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