When the new Facebook platform was introduced last year, it was believed to the “next big thing” in social media. The media, small start-ups, and even large corporations all shared equal enthusiasm for its future potential. And this is not surprising since Facebook has an estimated 50 million users worldwide with most of its audience concentrated in North America.
The platform enables you to deliver your applications to millions of people instead of delivering it to our audience one by one. And it will not only be delivered, it will be injected to a massive network of users. However, despite all the carefully laid-out plans for the new platform, three major issues surfaced including:
1. Business – if a publisher, the Wall Street Journal for example, develops a Facebook application, would this be profitable for them? It is very unlikely because there is little revenue to be derived from Facebook.
2. Technical – should the applications be a “teaser” that directs members to the site or should it have full functionality?
3. Provider cost – would Facebook derive revenue if it maintains the platform? As a business with high valuation, the company needs to maximize its profitability.
Unlike Apple, Facebook did not develop a structure for paid applications. Instead, the way to monetize the applications is through advertising.
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