Facebook Wants to Compete With Everyone

As Facebook (NASDAQ: FB) continues to face antitrust scrutiny and grapple with calls that it should be broken up, the social networking behemoth wants to get even bigger. Through ruthless competition and aggressive acquisitions, Facebook has transformed from a single tech platform into a sprawling conglomerate, operating most of the world’s largest social networking services including WhatsApp and Instagram.

In defending Facebook from antitrust criticisms in front of Congress in early 2018, CEO Mark Zuckerberg said that the “average American I think uses eight different communication and social apps,” suggesting that competition in the marketplace is robust and everything is fine. What His Zuckness did not mention is that Facebook either owns most of those apps, or is actively trying to supplant them by developing clones.

Image source: Getty Images.

Facebook has a lot more apps up its sleeve.

There’s an app for that

The New York Times reports that Facebook is contemplating releasing a handful of apps that span new categories, including podcasts, travel planning, enterprise productivity, and newsletter tools. The ambitions are wide-ranging and mostly represent areas where Facebook has little to no experience thus far, but the company has earned a reputation for experimentation by regularly releasing new apps and then quickly shuttering them if they flop.

Over the summer, Facebook had announced that it was creating the New Product Experimentation (NPE) Team, whose edict is self-explanatory. Apps that are developed by the NPE Team carry that branding, so that users know to expect frequent changes.

“NPE Team apps will be aligned with Facebook’s mission of giving people the power to build community but will focus on shipping entirely new experiences,” the company said. “We decided to use this separate brand name to help set the appropriate expectations with users that NPE Team apps will change very rapidly and will be shut down if we learn that they’re not useful to people.” Facebook also added that it expects “many failures.”

The first NPE Team apps were released last month: a chat app called Bump that allows users to chat anonymously with others in close physical proximity, a social music listening app called Aux, and a meme creator called Whale. Facebook isn’t concerned about monetization initially, which is in line with Zuckerberg’s long-standing strategy of building up user bases before turning attention to profitability.

Competing with everyone

A Facebook podcast app could encroach on Apple and Spotify, while a travel planning app might step on the toes of Booking Holdings or Expedia. Facebook has already dabbled in the enterprise with Workplace, but further incursions could irritate Microsoft or Slack, as Facebook has considered revamping email or developing presentation software that uses the popular Stories format that has overtaken social media, according to the report. Current email newsletter platforms include start-ups like Mailchimp and Substack.

Of course, many of these ideas are still just that; the company may never move forward with releasing them. Presumably, Facebook’s new Viewpoints app may also eventually help inform which areas to explore and which to leave alone.

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Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Evan Niu, CFA owns shares of Apple, Facebook, and Spotify Technology. The Motley Fool owns shares of and recommends Apple, Booking Holdings, Facebook, Microsoft, Slack Technologies, and Spotify Technology and recommends the following options: long January 2021 $85 calls on Microsoft. The Motley Fool has a disclosure policy.

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