Future of Tech: Facebook's Dominance Challenged by Social-Media Splinter
October 22 2019 - 2:29PM
Dow Jones News
By Heather Somerville
Facebook Inc.'s dominance is declining as people spend more of
their attention on alternative social-media platforms that promise
privacy or cater to selective interests and hobbies.
A lack of public trust in Facebook and growing interest in
alternative social networks such as discussion forum Reddit Inc.
and mobile-video app TikTok have caused the social-media market to
splinter, according Michael Wolf, co-founder and chief executive of
consulting firm Activate Inc. Taken together, these networks pose a
threat to Facebook, which is already under siege by governments and
users for its personal data-collection practices and the spread of
misinformation on its platform.
The trend is one of several in the tech and media industries
that Mr. Wolf is sharing during a presentation at The Wall Street
Journal's WSJ Tech Live conference on Tuesday in Laguna Beach,
Calif.
Although Facebook's more than 2 billion daily users is
unmatched, the amount of time people are spending on Facebook's
website monthly has dropped by 26% since 2017, Mr. Wolf's research
found.
Social-media users are instead gravitating to networks relevant
to their local community or interests, whether it is cannabis,
gaming, trail running or best-selling novels.
Today, the average user toggles between about six different
social networks. By 2023, people will use an average of about 10,
according to Activate's analysis.
"There will be a broad social-networking world beyond Facebook
as other large social networks' growth exceeds Facebook's," Mr.
Wolf said in an interview.
Mr. Wolf also forecasts that online sports betting is poised to
become a massive financial trading market, with bets wagered
growing more than 11-fold by 2023. Industry players include
everyone from tech companies to television networks. It isn't just
football and baseball enthusiasts eager to place bets, but also
fans of drone racing, bull riding and the urban acrobatics known as
parkour. Mr. Wolf predicts that total annual U.S. sports wagering
will grow from $13 billion to $149 billion in five years.
Key to this industry's growth is employing sophisticated data
science and machine learning to make determinations about the
outcome of games. The risk: Legislative headwinds might emerge in
the 24 states where bills to legalize sports betting are
pending.
Other findings from Mr. Wolf's presentation:
-- Consumers will subscribe to more video-streaming services,
particularly as prices remain relatively affordable, with the
average number of subscriptions per consumer growing from more than
two to nearly five in 2023. Despite streaming media giants Netflix
Inc., Amazon.com Inc. and Hulu investing a combined $4 billion in
original content this year, viewers are often more interested in
licensed classics like "Seinfeld" and "Friends."
-- A large share of streaming music fans are getting their tunes
free by settling for ad-based services and avoiding monthly
subscription fees. Almost 40% of people who currently don't pay for
a music service say they are happy with the free version and may
never want to pay. Alphabet Inc.'s YouTube has the highest number
of free music tracks at 3 billion.
-- More digital financial services are branching out from online
payments to credit services, such as point-of-sale loans and credit
cards, in a bid to fuel growth.
-- E-commerce remains a small piece of the overall retail
industry but will nearly double in size to $6.8 trillion in annual
global sales by 2023. China continues to be a leader, including
Alibaba Group Holding Ltd.-owned Tmall.com and Taobao.com.
-- The number of podcasts available on iTunes jumped from 60,000
in 2015 to 750,000 this year, and will continue growing. Listeners
are flocking to podcasts because of the ability to multitask while
listening to audio. More than a quarter of listeners say they
always combine listening with some other activity, whether that is
driving a car, exercising or shopping.
Write to Heather Somerville at Heather.Somerville@wsj.com
(END) Dow Jones Newswires
October 22, 2019 14:14 ET (18:14 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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