Meta Companies Lose Market Share Among Teens & Other Groups; Focus Change Problematic
*Seinfeld Voice* "Hm. That's a shame."
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Pew survey reveals more bad news for Meta
Daniel Howley·Technology Editor
Thu, August 11, 2022 at 2:51 AM·
The hits keep coming for Meta (META). A new survey from Pew Research Center shows that the social media empire continues to lose its grip on its most important audience of all: teens. The survey released Wednesday asked 1,316 U.S. teens between the ages of 13 and 17 about their online habits and found that Facebook usage has plummeted among younger users.
According to Pew, just 32% of teens say they use Meta’s Facebook app. That’s a massive decline from the 71% who said they used the app in a similar survey of teens conducted between 2014 and 2015. YouTube is the most widely used social network among teens, with 95% of teens saying they use the Alphabet-owned (GOOG, GOOGL) video sharing site.
What’s worse, for Meta at least, is that some 67% of teens report using its archnemesis: short-form video app TikTok. Meta has failed to recapture its teen audience from TikTok, going so far as to rearrange the main Facebook app by adding a Home feed that surfaces algorithmically driven content, aping to TikTok’s addictive For You page.
In Q4, Meta reported that Facebook lost daily active users quarter over quarter for the first time in the social network’s history.
Perhaps more worrying for Meta is the fact that 62% of teens say they use Instagram, which is 5% fewer than use TikTok. Meta has been leaning into the photo and video sharing app in recent years as a hedge against TikTok.
Mark Zuckerberg, via video, speaks at Into the Metaverse: Creators, Commerce and Connection during the 2022 SXSW Conference and Festivals. (Photo by Samantha Burkardt/Getty Images for SXSW)
And while a 5% difference between TikTok and Instagram use may not seem huge, the survey also showed that Instagram usage among teens only rose 10% since the 2014 and 2015 survey. Usage of rival Snapchat (SNAP), meanwhile, rose from 41% to 59%. TikTok wasn’t included in the prior survey.
In the past, Meta rolled out new features to combat up and coming peers. It famously debuted its Stories product to take on Snapchat’s Snaps, with relative success. But Meta tried to roll out a test of a new Instagram feed that mimicked the look and style of TikTok, influential users like Kim Kardashian and Kylie Jenner revolted and demanded Instagram go back to its old feed.
The test design sparked so much anger that Instagram head Adam Mosseri finally said the move was only available to some users and that it wasn’t moving forward with the change.
Facebook isn’t the only social media site losing teens’ interest. Twitter (TWTR) also saw the number of teens who use the site fall from 33% to 23% and Tumblr use, meanwhile, fell from 14% to 5%.
Twitch, WhatsApp, and Reddit saw 20%, 17%, and 14% of teens access their services, respectively. Pew didn’t ask about those services in its prior survey. Teen boys were more likely to say they used YouTube, Twitch, and Reddit, while girls are more likely to use TikTok, Instagram, and Snapchat.
Meta, and the social media industry in general, has bigger problems than failing to capture teens’ attention. The company is contending with a drop in advertiser spending, causing it to miss Wall Street’s expectations on both revenue and earnings per share. Part of the issue has to do with inflation and rising interest rates impacting advertisers, as well as the war in Ukraine. The industry is also continuing to deal with the fallout from Apple’s (AAPL) App Tracking Transparency. The feature, which allows users to prevent apps from tracking them across the web, has hammered companies such as Meta, which said that it will cost the company $10 billion.
All of this comes as Meta attempts to transition itself from a social media first company to a metaverse company focused on creating AR and VR worlds, costing the firm billions of dollars. With all of that going on, whether Meta can make Facebook the “it” app among teens again may end up taking a backseat to its myriad other problems for now.
https://finance.yahoo.com/news/pew-survey-reveals-more-bad-news-for-meta-175124484.html?.tsrc=366
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Meta's 'wrenching business model change' makes its future uncertain, analyst says
Alexandra Garfinkle·Senior Reporter
Tue, August 9, 2022 at 10:21 PM·
As earnings season winds down, major tech names such as (AMZN), Microsoft (MSFT), and Alphabet (GOOG, GOOGL) have proven remarkably resilient in a tough macroeconomic environment. But not every tech company has come out unscathed, Independent Solutions Wealth Management Portfolio Manager Paul Meeks told Yahoo Finance. "I think that Amazon, Microsoft, and Alphabet have shown some nice resiliency," he told Yahoo Finance last week. "I'm still... staying away, for defensive purposes, [from] Netflix (NFLX) and Meta (META)."
Meeks expressed particular concern about Meta, which owns Facebook, Instagram, and WhatsApp. The digital advertising market has been shaky, especially after Apple (AAPL) made privacy changes last year that curb the ability of apps to effectively target consumers with ads. “This is a period that demands more intensity and I expect us to get more done with fewer resources,” CEO Mark Zuckerberg told analysts in its most recent earnings call.
Mark Zuckerberg, via video, speaks at Into the Metaverse: Creators, Commerce and Connection during the 2022 SXSW Conference and Festivals at Austin Convention Center on March 15, 2022 in Austin, Texas. (Photo by Samantha Burkardt/Getty Images for SXSW)
While Meeks believes we'll see a "rebound in digital advertising," he says Meta's troubles run deeper than that. Meta, which reported its first-ever revenue drop in late July, has been in the midst of a paradigm shift. In 2021, the company changed its name and began to prioritize its bet on the metaverse, a framework that includes virtual reality experiences. Meta also reported earnings per share and revenue misses.
"Here's a company that's going through a wrenching business model change, and I don't know what it looks like as far as top-line and bottom-line growth afterwards," Meeks told Yahoo Finance. "I need to stay away until I can at least guesstimate what this company will be and look like."
Meta's stock is down approximately 49% year-to-date.
Why Netflix's challenges differ from Meta's
Meeks added that he feels "a bit better" about Netflix, as compared to Meta, and expressed optimism about Netflix's forthcoming ad-supported product. In July, Netflix announced it would be working with Microsoft in developing the company's first ad-based subscription offering.
Meta, on the other hand, has been retooling itself from focusing on its social media properties, to building out its presence in the metaverse, which is why the company changed its name from Facebook. "At least with Netflix, we know that their business model will be similar, whereas [with] Meta, they're going from black to white," Meeks said. He added, "The problem with Meta [is that] they're going from one business to a potentially really different business."
https://finance.yahoo.com/news/metas-wrenching-business-model-change-makes-its-future-uncertain-analyst-says-132106571.html?.tsrc=366
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Pew survey reveals more bad news for Meta
Daniel Howley·Technology Editor
Thu, August 11, 2022 at 2:51 AM·
The hits keep coming for Meta (META). A new survey from Pew Research Center shows that the social media empire continues to lose its grip on its most important audience of all: teens. The survey released Wednesday asked 1,316 U.S. teens between the ages of 13 and 17 about their online habits and found that Facebook usage has plummeted among younger users.
According to Pew, just 32% of teens say they use Meta’s Facebook app. That’s a massive decline from the 71% who said they used the app in a similar survey of teens conducted between 2014 and 2015. YouTube is the most widely used social network among teens, with 95% of teens saying they use the Alphabet-owned (GOOG, GOOGL) video sharing site.
What’s worse, for Meta at least, is that some 67% of teens report using its archnemesis: short-form video app TikTok. Meta has failed to recapture its teen audience from TikTok, going so far as to rearrange the main Facebook app by adding a Home feed that surfaces algorithmically driven content, aping to TikTok’s addictive For You page.
In Q4, Meta reported that Facebook lost daily active users quarter over quarter for the first time in the social network’s history.
Perhaps more worrying for Meta is the fact that 62% of teens say they use Instagram, which is 5% fewer than use TikTok. Meta has been leaning into the photo and video sharing app in recent years as a hedge against TikTok.
Mark Zuckerberg, via video, speaks at Into the Metaverse: Creators, Commerce and Connection during the 2022 SXSW Conference and Festivals. (Photo by Samantha Burkardt/Getty Images for SXSW)
And while a 5% difference between TikTok and Instagram use may not seem huge, the survey also showed that Instagram usage among teens only rose 10% since the 2014 and 2015 survey. Usage of rival Snapchat (SNAP), meanwhile, rose from 41% to 59%. TikTok wasn’t included in the prior survey.
In the past, Meta rolled out new features to combat up and coming peers. It famously debuted its Stories product to take on Snapchat’s Snaps, with relative success. But Meta tried to roll out a test of a new Instagram feed that mimicked the look and style of TikTok, influential users like Kim Kardashian and Kylie Jenner revolted and demanded Instagram go back to its old feed.
The test design sparked so much anger that Instagram head Adam Mosseri finally said the move was only available to some users and that it wasn’t moving forward with the change.
Facebook isn’t the only social media site losing teens’ interest. Twitter (TWTR) also saw the number of teens who use the site fall from 33% to 23% and Tumblr use, meanwhile, fell from 14% to 5%.
Twitch, WhatsApp, and Reddit saw 20%, 17%, and 14% of teens access their services, respectively. Pew didn’t ask about those services in its prior survey. Teen boys were more likely to say they used YouTube, Twitch, and Reddit, while girls are more likely to use TikTok, Instagram, and Snapchat.
Meta, and the social media industry in general, has bigger problems than failing to capture teens’ attention. The company is contending with a drop in advertiser spending, causing it to miss Wall Street’s expectations on both revenue and earnings per share. Part of the issue has to do with inflation and rising interest rates impacting advertisers, as well as the war in Ukraine. The industry is also continuing to deal with the fallout from Apple’s (AAPL) App Tracking Transparency. The feature, which allows users to prevent apps from tracking them across the web, has hammered companies such as Meta, which said that it will cost the company $10 billion.
All of this comes as Meta attempts to transition itself from a social media first company to a metaverse company focused on creating AR and VR worlds, costing the firm billions of dollars. With all of that going on, whether Meta can make Facebook the “it” app among teens again may end up taking a backseat to its myriad other problems for now.
https://finance.yahoo.com/news/pew-survey-reveals-more-bad-news-for-meta-175124484.html?.tsrc=366
-------------------------------------------------------------
Meta's 'wrenching business model change' makes its future uncertain, analyst says
Alexandra Garfinkle·Senior Reporter
Tue, August 9, 2022 at 10:21 PM·
As earnings season winds down, major tech names such as (AMZN), Microsoft (MSFT), and Alphabet (GOOG, GOOGL) have proven remarkably resilient in a tough macroeconomic environment. But not every tech company has come out unscathed, Independent Solutions Wealth Management Portfolio Manager Paul Meeks told Yahoo Finance. "I think that Amazon, Microsoft, and Alphabet have shown some nice resiliency," he told Yahoo Finance last week. "I'm still... staying away, for defensive purposes, [from] Netflix (NFLX) and Meta (META)."
Meeks expressed particular concern about Meta, which owns Facebook, Instagram, and WhatsApp. The digital advertising market has been shaky, especially after Apple (AAPL) made privacy changes last year that curb the ability of apps to effectively target consumers with ads. “This is a period that demands more intensity and I expect us to get more done with fewer resources,” CEO Mark Zuckerberg told analysts in its most recent earnings call.
Mark Zuckerberg, via video, speaks at Into the Metaverse: Creators, Commerce and Connection during the 2022 SXSW Conference and Festivals at Austin Convention Center on March 15, 2022 in Austin, Texas. (Photo by Samantha Burkardt/Getty Images for SXSW)
While Meeks believes we'll see a "rebound in digital advertising," he says Meta's troubles run deeper than that. Meta, which reported its first-ever revenue drop in late July, has been in the midst of a paradigm shift. In 2021, the company changed its name and began to prioritize its bet on the metaverse, a framework that includes virtual reality experiences. Meta also reported earnings per share and revenue misses.
"Here's a company that's going through a wrenching business model change, and I don't know what it looks like as far as top-line and bottom-line growth afterwards," Meeks told Yahoo Finance. "I need to stay away until I can at least guesstimate what this company will be and look like."
Meta's stock is down approximately 49% year-to-date.
Why Netflix's challenges differ from Meta's
Meeks added that he feels "a bit better" about Netflix, as compared to Meta, and expressed optimism about Netflix's forthcoming ad-supported product. In July, Netflix announced it would be working with Microsoft in developing the company's first ad-based subscription offering.
Meta, on the other hand, has been retooling itself from focusing on its social media properties, to building out its presence in the metaverse, which is why the company changed its name from Facebook. "At least with Netflix, we know that their business model will be similar, whereas [with] Meta, they're going from black to white," Meeks said. He added, "The problem with Meta [is that] they're going from one business to a potentially really different business."
https://finance.yahoo.com/news/metas-wrenching-business-model-change-makes-its-future-uncertain-analyst-says-132106571.html?.tsrc=366