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Facebook is the worlds largest social network, boasting more than 900 million users and dominating the online world in several countries around the world. On May 18, the company is expected to go public and raise several billion dollars that it can use to fund acquisitions and promote future growth. Its a lofty goal, for sure, but its one that, given the history of major Web IPOs, doesnt seem out of the question.
Yet another thing thats not out of the question as it relates to Facebook is its ability to become the next Google. Since its IPO, Google has become a Web and technology industry juggernaut, establishing itself as a leader in search, advertising and even mobile phones. In addition, the companys innovative exploits are second to none.
But for the first time in Google’s relatively brief and storied history, a new company has come along with a record of rapid growth and global presence that could challenge even Googles unparalleled record.
If Facebook makes the right management decisions and continues to innovate in the social networking space, it might use its IPO riches to become an even greater technology industry powerhouse.
Read on to find out how Facebook could become the next Google.
1. Consider the IPOs
The similarities between Google and Facebook perhaps become most striking when one considers their initial public offerings. As of this writing, Googles IPO is the largest of any Web firm. But Facebook is on its way to shattering that record. First things first: In order for Facebook to become the next Google, it needs to follow in its footsteps. It appears to be doing that with its IPO.
2. Advertising
Although Facebook started without a clear path to monetization, the company is now doing a fine job of generating cash from its user base. In fact, last quarter, it made about $1 billion in revenue by advertising alone. And over time, the company is expected to continue to increase its ad revenue as more marketers warm to the idea of promoting content to people based on many more factorslike when they were born and where they workthan Googles offering.
3. The user base is expanding
According to the latest S-1 Registration Statement Facebook filed with the SEC, the company has 901 million monthly active users. Thats a monstrous figure that is anticipated to hit 1 billion sooner rather than later. The most important reason Google became so rich and powerful is its ever-increasing worldwide user base. So far, Facebook has the same thing going for itself.
4. Facebook has eyes on other markets
Although Google started in search and monetized its service with advertising, the company quickly expanded into other markets, including mobile, maps, applications many others. Facebook, meanwhile, is following that same path with talk of establishing a greater presence in mobile and even offering an email service through its platform. Facebook is no longer just a social network.
Zuckerberg Will Continue to Control Decision Making
5. The founders remain in control
One interesting thing about Google is that its co-founders Sergey Brin and Larry Page stated their intention to retain some control over their companys direction. In fact, they both had a controlling stake in decision making at Google even after its IPO. After Facebooks IPO, Zuckerberg will have a 57 percent ownership of the companys shares, which gives him total control over Facebooks decision making. Make no mistake, Zuckerberg, Brin and Page all love control.
6. Regulatory concerns
Despite Googles continued success, the company has faced a host of regulatory issues with governing bodies in the U.S. and Europe. Looking ahead, its expected to face even more trouble. Even before its IPO, Facebook has come under regulatory scrutiny over concerns about its users’ data privacy. It even acknowledges in its own risk factors in its S-1 Registration Statement that it could very well face more scrutiny in the coming years. See the similarities?
7. Facebook is indeed eyeing search
Although Google might not like it, Facebook has been slowly but surely starting to creep its way in the search game. When users type keywords into Facebooks search bar, theyre not only presented with access to pages related to that, but also Web results. With so many users, why shouldnt Facebook try its luck at search?
8. The app battle
Whereas Google has its own application stores, including Google Play and the Chrome Web Store, Facebook allows users to access applications from its own service. With help from Facebook Credits, the social network shares revenue with developers who earn cash from the applications they produce. It sounds awfully Google-like, doesnt it?
9. Facebooks Open Graph tentacles
One of the issues many stakeholders have with Google is that it attempts to bring its innumerable services to as many Websites as possible. Although Facebook started as a walled garden, the companys Open Graph initiative has allowed it to extend its tentacles across the Web. Look for that to continue in the coming years.
10. Power and influence
Finally, its difficult to overestimate the sheer power and influence both Google and Facebook have in the online world. With so many users and so many Websites relying on their services for one thing or another, the companies have far more influence in the online world than most others. Chances are that kind of power will only be augmented as both companies pick up would-be competitors in blockbuster acquisitions.
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