Gregory John Lee

Vernon Timothy Thaver

From

Facebook then Meta: Yesterday, today, & tomorrow

Digital BusinessMain area: Strategy in the digital era
Other areas: Digital exponentials & abundance
Research to end 2024

Meta Case

Love them or hate them, there is no denying that social media giant Meta has been a game-changing organization. As the holding company for social media technology giants like Instagram, Facebook, and WhatsApp, Meta is one of the world’s most influential organizations and a major innovator in the social technology space.

The Origin Story: Facebook

The origin story behind Facebook is so well known it has passed into digital legend. In late 2003, Mark Zuckerberg, a Harvard University student and enthusiastic developer, had already created a series of desktop computer applications such as Coursematch, in which students could view fellow course attendees, and Facemash, which included hacked photographs of students and in which students could rate the attractiveness of their peers (Phillips, 2007). Facemash was closed down by the university for using hacked photographs and, frankly, for being in poor taste (Sivakumar, 2023). However, the taste for new social applications, at least among students, had seemingly been proven in these initial attempts. Congruently, Myspace was also blazing the trail for social media and showing what could be achieved with dramatic growth.

In February 2004, Zuckerberg teamed up with a group of fellow Harvard dorm mates to develop an initial app called “TheFacebook” which they initially only released to and for Harvard students (Sivakumar, 2023). This progenitor of Facebook was a digitization of the traditional book of class photographs and identities that was disseminated among students in various degrees. The product was an almost immediate success in Harvard, as noted by Phillips (2007): within 24 hours, 1,200 Harvard students had signed up, and after one month, over half of the undergraduate population had a profile.

TheFacebook’s focus on students and campuses was a specific feature that helped distinguish it from Myspace, which may have helped them gain a foothold among college students. The team rapidly scaled TheFacebook throughout the United States college community. Only a month after the Harvard release, they included Columbia, Stanford, and Yale (Sraders, 2020), in other words, scaling to similar ivy-league environments to Harvard, which bettered their odds of similar successes. The continued success led the team to continue scaling the product throughout US campuses, including non-ivy league institutions who received it just as well.

Figure 1: An early example of TheFacebook’s look
Source: Loomer (2012)

The stellar early growth of TheFacebook inspired Zuckerberg to leave Harvard before graduating to work on the business full-time. He moved the headquarters to Silicon Valley, initially working out of a rental house. Networking was critical, as he enlisted Dean Parker, the founder of Napster, as a partner and garnered $500,000 and significant investment networking from Peter Thiel, founder of PayPal (Greiner et al., 2019).

The company increasingly worked on its product and its market. On the product front, between 2003 and 2006, they released key features such as “the Wall” (which allowed for publicly viewable posts), followed by many other features that are well known by now such as their name-change to Facebook, newsfeeds, tagging people, the Like button, and the mobile version of Facebook (clearly a key to future success, Sivakumar, 2023; Sraders, 2020).

As discussed above, one could argue that the initial genesis of Facebook lay not so much in commercial exploitation as in innovative exploration. As self-reported by Zuckerberg (McFadden, 2023):

I never started this to build a company…Ten years ago, you know, I was just trying to help connect people at colleges and a few schools…That was a basic need, where I looked around at the Internet and there were services for a lot of things that you wanted…You could find music; you could find news; you could find information, but you couldn’t find and connect with the people that you cared about, which as people is actually the most important thing. So that seemed like a pretty big hole that needed to get filled.

The focus in this first phase of Facebook was clearly on building users. Growth continued apace among college students: by June 2004, less than a year and half after inception, over 250,000 students from 34 colleges had joined Facebook. This number had reached one million users by the end of 2004 (McFadden, 2023; Sivakumar, 2023). In 2005, the site expanded to high school students and non-US universities, growing to over six million users by the end of that year. In 2006, they expanded to the employees of major tech companies and then to the general public (any user over the age of thirteen), garnering some 12 million users by December 2006. Thereafter, Facebook’s growth continued on a massive exponential path, although it is worth noting that Facebook lagged contemporaneous competitor Myspace for some time, only overtaking them in 2008 (Hall, 2022). The left pane of Figure 2 shows the growth in users in the Facebook platform until the third quarter of 2024.

Figure 2: Facebook’s usership and annual revenue figures
Note that the usership data are for the Facebook platform only, while the revenue figures are for the Meta group as a whole, with 2024 figures forecasted based on information available in early December 2024.
Sources: Backlinko (2024), Dixon (2024a & b), Trefis (2024)

A challenge in this first period of building the user base was to build out new features that were attractive and not controversial and problematic for users. This proved to be difficult, since virtually all Facebook activities involved exposing user information to others, which walks a fine line between the desired effect of connection and privacy concerns. As one example of the challenges in this period, Facebook found controversy with its Newsfeed feature introduced in 2006, which was overly visible to other users, forcing them to introduce user privacy controls. In another example, they introduced a “Beacon” feature in 2007 which tracked users’ behavior on third-party websites, which also attracted substantial user resistance and bad press, and which had to be discontinued (Greiner et al., 2019). However, even with such controversies, the user base continued to grow apace, which was possible partly to the company’s responsiveness to issues.

Building the Business Model

It did not take long for the commercial possibilities of Facebook to become apparent, possibly stimulated by the guidance of Parker and Thiel. Having built the initial user base and seen the exponential growth, the second push for Facebook was to attract advertisers. They started this relatively early; for example, companies like Mastercard were paying for exposure as early as 2004. The key was direct customer contact, which was something not available in traditional marketing – as noted by Hall (2022) for a 2006 campaign:

[H]ousehold product manufacturer Procter & Gamble attracted 14,000 people to a promotional effort by “expressing affinity” with a teeth-whitening product. This kind of direct consumer engagement on such a large scale had not been possible before Facebook, and more companies began using the social network for marketing and advertising.

The advertising revenue stream started to escalate, and the company added further commercialization opportunities. For instance, in 2007, Facebook introduced the Groups feature which allowed businesses to create pages. This also turned into trading opportunities and other monetizable options. The right pane of Figure 2 shows the annual growth in revenue in Meta as a group until 2024.

Expanding to an App Ecosystem and Maturing

Many cycles of funding, product development, commercialization, and controversy have occurred since the early Facebook years. Important in the 2010s was Facebook’s acquisition trail, with the company buying Instagram and WhatsApp among others to add to their already-existing grouping of Facebook and Messenger (Sivakumar, 2023). These acquisitions enabled the group to appeal to and access a wider variety of users, especially as Facebook’s demographic began to shift to older users.

This period over the 2010 was the major growth period for Meta, as seen in the charts in Figure 2.

Adding to the ecosystem continued into the 2020s in an attempt to compete with other major and disruptive social media players. In 2020, Meta introduced Reels – its response to the popular platform TikTok. In roughly three years, Reels supposedly reached the same size as TikTok’s businesses based on ad revenue (Dang & Paul, 2023). In July 2023, Meta launched Threads, a platform created to compete with X (formerly Twitter). In the first five days of its existence, Threads had amassed 100 million users, largely made possible by linking Instagram and Threads accounts (Davis, 2024). As of October 2024, Zuckerberg reported that Threads had 275 million monthly active users (Hutchinson, 2024). Having said this, the initial success of Threads appears to have stalled somewhat, although their trajectory remains to be seen. However, the impending US decision to ban TikTok or force its sale to a local competitor promises to provide a major boost to Meta’s investment in Reels should it go ahead (Trefis, 2024).

There have been signs that some of the “traditional” social media businesses in the Meta group have begun to settle somewhat into a mature or even declining market. For example, Facebook began to run out of ad space in Newsfeed, and Richter (2022) presents possible signs of a plateau in Facebook usership (this can be seen in the shallowing pattern in the left pane of Figure 2).

Thinking Far Ahead: The Metaverse Focus

As its traditional social media products have reached mature stages through the 2010s, Facebook began to explore a relatively futuristic concept: the Metaverse. Still nascent, the Metaverse concept involves notions such as integrated augmented and virtual reality universes with built-in financial technologies and integrated record keeping which would allow users to integrate social media even more into daily life (McFadden, 2023). The move towards this concept may have started as early as 2014 when Facebook acquired Oculus, a virtual reality firm (Greiner et al., 2019). The Metaverse concept even inspired the group to change its name to Meta in October 2021 (Clayton, 2023; Meta, 2021).

In the face of a seemingly dramatic stage in the growth and prospects of the group and increasing competition in the social media space, Zuckerberg’s hope in the potential of the Metaverse to help revive the group was clear, as reported by Vanian (2022):

Zuckerberg said he hopes that within the next decade, the metaverse “will reach a billion people” and “host hundreds of billions of dollars of digital commerce.” He told CNBC’s Jim Cramer in June that the “North Star” is to reach those sorts of figures by the end of the decade and create a “massive economy” around digital goods.

However, the pivot of Facebook to the metaverse has been one fraught with difficulty. Reality Labs (a branch of Meta that focuses on virtual and augmented reality) lost more than $21 billion between 2022 and 2023 (Clayton, 2023). In normal times, this type of expenditure might be seen as mere seed capital, however, in this reality of severely constrained post-COVID times at the beginning of the 2020s this was seen as a bridge too far and too soon by many. As noted by Olson (2022):

Zuckerberg’s expensive shift to the metaverse is also inspiring less and less confidence. He posted a virtual selfie last month that was widely ridiculed for its crude graphics, and the company’s primary focus on headsets as the main gateway to the metaverse looks unwise. The most successful metaverse platforms already exist in 2D, with Roblox Corp. and Epic Games Inc.’s Fortnight, and have managed to attract millions of regular users with incentives around building and sharing experiences…Meta has instead focused on the immersive sensation of its virtual reality products, which isn’t all that appealing. Its Horizon Worlds doesn’t have the same kinds of built-in incentives as Roblox and Fortnight, either.

As of the first few months of 2024, Reality Labs’ losses had shrunk by 17% compared to the last quarter of 2023 (Bratton, 2024), though these losses still remain large (e.g., $1 billion in revenue vs. $4.65 billion in losses, Cheng, 2024). Overall, the Metaverse has proven to be a financial sinkhole, with Reality Labs predicted to lose $20 billion in 2024 (Snow, 2024). Gene Munster, a managing partner at Deepwater Asset Management, noted that while Meta can continue to work on the Metaverse, if the hardware does not advance enough in the next few years, their investments will need to be redirected elsewhere (Snow, 2024).

The AI section below highlights how the addition of a major focus on AI may help to round off the Metaverse concept.

Crisis in the Early 2020s

Certainly, Meta’s empire began to show signs of strain over the early 2020s, despite the belief that COVID lockdowns would be a boon for social media. By 2022, Meta began announcing a hiring freeze and the possibility of the first major retrenchments of its existence (e.g., Fried, 2022; Olson, 2022; Times of India, 2022; The Guardian, 2022). Since announcing the Metaverse, Meta has had some major layoffs: in October 2022, 11,000 employees (13% of its workforce) were laid off, though Reality Labs was mostly unaffected (Rose, 2022), and in March 2023, a further 10,000 employees were set to be laid off, reportedly to focus on efficiency (Thorbecke, 2023). By September 30th 2022, Meta shares were down by 60% for the year (Zilber, 2022). There were at least three reasons for this seeming crisis.

Conventional companies which formed the core of Meta’s advertising pool were cutting advertising spend, largely because of the temporary economic headwinds created by COVID and, perhaps, partly because of the scrutiny of Meta’s ethics. This was an issue shared by the industry (as noted by Fried (2022), Google, Microsoft and Apple reduced hiring in 2022 and companies such as Snap, Docusign, Coinbase, and Netflix were undertaking retrenchments).
The enormous investments in the Metaverse, as discussed above, with no commensurate revenue, had cut severely into Meta’s profitability.
Competition had become far fiercer, especially with a youth migration to TikTok.

As noted by Brent Thill of Jeffries (Olinga, 2002):

So you have an ad slowdown, which is the first thing that companies cut when there’s an economic headwinds. I think the second component is competition. Obviously there’s been a stampede to TikTok…Very few 18 to 25 year olds are still on Facebook, they stampeded over to TikTok. So I think you have a competitive issue as well. In the interim you have revenue stolen, you have big investments going into the metaverse, you have operating margins coming down, and then you have the combined effect of no interest in buying technology right now

During this crisis, the very future of Meta was being questioned, as evidenced by headlines such as:

“Has Facebook reached its growth limit?”

Richter (2022)

“Facebook scrambles to escape stock’s death spiral as users flee, sales drop”

Vanian (2022)

“Wall Street sours on Facebook: ‘I’m not sure there’s a core business that works anymore'”

Zilber (2022)

Things seemed bleak for Meta. However, the end of 2022 saw the modern advent of generative AI, and a new possibility as discussed next.

Pivoting to AI

Roughly two years after heavily investing into the Metaverse, in 2023, Zuckerberg announced that most of their next investments would go towards “advancing AI and building into every one of [their] products”, though the Metaverse still “remains central to defining the future of social connection” (Thorbecke, 2023), with the company expecting to invest between $35 and $40 billion into AI in 2024 (BBC, 2024).

Meta’s AI has several functions, for example, giving advertisers creative freedom to vary their featured advertisements (Swant, 2024) and adding an AI assistant chatbot to Meta’s apps, where questions and requests can be entered (Capoot, 2024), a clear response to OpenAI’s ChatGPT and Google’s Gemini. Currently, the Meta AI bot uses Google and Microsoft’s Bing to source information for queries; however, there are hints that Meta is working on its own AI-powered search engine (Roth, 2024). Importantly, Meta has developed and provided a key free generative AI training framework, the LLAMA frameworks, which promise already to become a keystone in the wildly successful generative AI industry.

The move to AI investments has not been devoid of attention to the metaverse. For example, in December 2024, Reuters (2024) reports:

Meta said on Thursday it was releasing an artificial intelligence model called Meta Motivo, which could control the movements of a human-like digital agent, with the potential to enhance Metaverse experience. The company has been plowing tens of billions of dollars into its investments in AI, augmented reality and other Metaverse technologies, driving up its capital expense forecast for 2024 to a record high of between $37 billion and $40 billion. Meta has also been releasing many of its AI models for free use by developers, believing that an open approach could benefit its business by fostering the creation of better tools for its services. “We believe this research could pave the way for fully embodied agents in the Metaverse, leading to more lifelike NPCs, democratization of character animation, and new types of immersive experiences,” the company said in a statement. Meta Motivo addresses body control problems commonly seen in digital avatars, enabling them to perform movements in a more realistic, human-like manner.

It may be, therefore, that the Meta AI initiatives provide the extra missing piece for the eventual take-off of the metaverse.

It appears Meta’s shift to efficiency and AI was a welcomed change, as shares increased by 83% from early 2022 to December 2024 (Trefis, 2024). Meta has also enjoyed a 24% year-on-year increase for their ad business, an increase in users, and increases in watch time and Reels resharing, all of which the company attributes to its investment in AI (Kelly, 2024).

Pervasive Ethical Criticisms

Since the initial excitement in the birth of social media had settled to a mature stage in the 2010s, Meta has never been far from ethical critique, especially as it relates to its effects on children. It would take a full book to detail and analyze all the ethical concerns with this company. Here, we mention just a few of the most pernicious:

A plethora of studies and reports have averred the potential for deleterious effects of social media on the mental health of people, most especially children and teens (e.g., Braghieri et al., 2022; Brooks. 2023; Cornell University, 2023; Kerr, 2023; Ortutay, 2024; Rothenberg, 2023). There are even reports of Meta’s own internal research showing such findings (e.g., Center for Countering Digital Hate, 2024). We also note that some formal academic studies have also shown the potential for both negative and some positive mental effects (e.g., Naslund et al., 2020; Sadagheyani & Tatari, 2021). Meta has mostly tried to deflect and deny these concerns, and, as noted below, they have quickly dismantled guardrails they were forced to implement.
Meta has been accused of monetizing user data in ways that have garnered ethical critique (e.g., Feiner, 2023; Sen, 2024). For instance, in 2024, Cooban (2024) reported that:

European consumer rights groups have accused Meta, the owner of Facebook and Instagram, of carrying out a “massive” and “illegal” operation of collecting data from hundreds of millions of users in the region. The European Consumer Organisation (BEUC), an umbrella body for 45 consumer groups, said eight of the groups were filing complaints with their respective national data protection authorities Thursday.

The groups claim that Meta (META) collects an unnecessary amount of information on its users — such as data used to infer their sexual orientation, emotional state or even their susceptibility to addiction — which they are unable to freely consent to. The company’s practices, the groups argue, breach parts of the European Union’s signature data privacy law, the General Data Protection Regulation or GDPR.

“With its illegal practices, Meta fuels the surveillance-based ads system which tracks consumers online and gathers vast amounts of personal data for the purpose of showing them adverts,” the BEUC said in a statement.
Meta platforms have frequently been accused of transmitting falsehoods, inflammatory material, baseless conspiracy theories, recruiting material for extremist and terrorist organizations, and so forth (e.g., Fishman, 2023; Center for Countering Digital Hate, 2024).
Meta has recently received criticism, as it plans to incorporate users’ public posts and images as a training dataset for its AI (McMahon, 2024).
Reports revealed that Meta would make its generative AI Llama technology available for military use, against its own stated policies (The Conversation, 2024).
Meta has recently removed any attempt at content moderation, seemingly relying on the second Trump presidency’s support in this matter (Nazzaro, 2025). Widespread fears have been expressed that this will open a sluicegate of hate speech, even over and above that allowed before (e.g., Lawler, 2025; Tech Xplore, 2025).

Unfortunately, it seems technology companies have to date mostly managed to deflect or bury the worst of the accusations of ethical breaches. It will take a sea change in the technology world to see this changed.

Meta Case: Conclusion

Meta has been an inescapable part of the Western world’s reality for several decades now, defining a modern reality in many ways. This case illustrates how the company has continued to evolve and find new ways to thrive, despite deep concerns about its impact. It remains to be seen whether these next foci will truly reinvent Meta as their traditional social media businesses mature. Undeniably, Meta continues to innovate in the social media and technology spaces.

Challenges to the reader: Meta

Meta and the horizons of growth

How can the concept of strategic horizons of growth be seen in Meta’s business evolution? You can watch this resource or similar resources to understand the horizons of growth concept. Contrast this with some other leading social media organizations.

How does the Facebook growth pattern illustrate digital exponentials?

How does the Facebook growth pattern illustrate digital exponentials? For a discussion on digital exponentials, see this explanation or similar resources online.

How does the Facebook growth pattern illustrate the concept of abundance?

How does the Facebook growth pattern illustrate the concept of abundance? Abundance refers to assets that are available and widespread. Greatly abundant assets can create a nearly endless flow of opportunity for revenue or other advantages. In the digital arena, some companies can tap into digitally created and greatly available and widespread digital assets to stock their business model. For instance, YouTube taps into user-created video which is abundant as it is limited only to the desire of millions of users to upload video. Some resources are less abundant, notably, where physical and/or constrained. There are a limited number of airplanes in the world, or highly skilled AI engineers. See this resource or similar ones for a discussion on abundance.

How does the Meta story illustrate convergences as a key ingredient of disruption?

How does the Meta story illustrate the concept of convergence? For this challenge, you can use this summary of the concept of convergence.

Platform business launch strategies in the Facebook story

What types of platform launch strategies do we see used in the Facebook story? For some examples of platform launch strategies, see this download.

Explaining Facebook’s domination of Myspace

Why do you think Facebook came to dominate Myspace, even though the latter had a strong head start in the social media space? Usually in technology spaces, latecomers do not dominate like this. You might use the crucial triad model (which you can read about here) to consider this question.

Reflections on ethical concerns at Meta

How do you think ethical concerns regarding Meta could be improved in the future, especially concerning possible negative effects on children and teens?

Conversely, play ‘devil’s advocate’ and argue for Meta’s right not to be required to moderate content online. What do you learn about reflecting on and researching this perspective, which also seems to be held by right wing governments around the world?

Reflections: Facebook and Meta

Meta and the horizons of growth

Following the horizons of growth concept, we see this concept playing out in the case of Meta as follows:

Horizon 1 at Meta: The focus in the first “horizon” of Facebook was clearly on building Facebook’s users. We see in the case how this was done.
Horizon 2 at Meta: We would argue that two distinct phases of horizon 2 activities can be seen at Meta:
- The first horizon 2 involved the second phase of Facebook. Having built the initial user base and seen the exponential growth, the second horizon of activity for Facebook was to attract advertisers. As seen in the case study, they started this relatively early. The “Horizon 2” advertising revenue stream started to escalate, and the company added further commercialization opportunities. For instance, in 2007, Facebook introduced the Groups feature, which allowed businesses to create pages. This also turned into trading opportunities and other monetizable options.
- As noted in the case, as Facebook itself started to mature, a second set of horizon 2 activities can be observed. Notable here was Facebook’s acquisition trail, with the company buying Instagram and WhatsApp among others to add to their already-existing grouping of Facebook and Messenger. These acquisitions enabled the group to appeal to and access a wider variety of users, especially as Facebook’s demographic began to shift to older users.
Horizon 3 at Meta: As seen in the case study, from the late 2010s, Facebook began to explore the Metaverse. Still nascent, the Metaverse concept involves notions such as integrated augmented and virtual reality universes with built-in financial technologies and integrated record keeping which would allow users to integrate social media even more into daily life. The move towards their Horizon 3 concept may have started as early as 2014 when Facebook acquired Oculus, a virtual reality firm. The Metaverse concept even inspired the group to change its name to Meta. It remains to be seen whether this next horizon of activity will truly reinvent Meta as their traditional social media businesses mature (this uncertainty is a classic feature of Horizon 3 projects).

How does the Facebook growth pattern illustrate digital exponentials?

For reference in this digital exponentials reflection, we repeat the charts of Facebook and Meta’s growth in Figure 3 (although the question specifically relates to Facebook itself, we will draw on a few elements of the Meta revenue chart too).

Figure 3: Repeat of Facebook’s usership and annual revenue figures
Sources: Backlinko (2024), Dixon (2024a & b), Trefis (2024)

There exists a simplistic, common narrative often found in digital business communities that exponential growth is immediate and perpetual acceleration in growth. In contrast, Facebook’s evolution follows the more realistic pattern we mention in the challenge question. As seen in Figure 3:

The “slow” initial growth phase in the exponential curve: Facebook’s initial growth is seemingly slow compared to later radical growth, which is a feature of exponential growth. In this initial period before the “tipping point”, an exponential pattern may be in effect, as we’ll see when representing the data on a logarithmic scale. But this is off a small initial base so that growth is a fraction of later achievement. Consider, for example, that the group’s revenue was approximately $10 million in 2005, growing to $50, $150, then $275 million across the next three years. This is clearly exponential growth; however, in the right pane of Figure 3, it is dwarfed by later growth.
The rapid growth phase in context of the overall pattern: Then, we do see the rapid growth phase. In Digital Business Vol I (Lee & Armstrong, 2023), we discuss the possibility of an event-based inflection point towards rapid growth. In the case of Facebook as a platform, this is more likely merely a continual growth pattern without an inflection point. In the left panel of Figure 3, we see truly exponential-like growth from ~2006 until 2009, whereafter, there is broadly linear growth between about 2010 and 2020. On the other hand, in the right pane of Figure 3, exponential revenue growth may be seen to coincide with the period after their major acquisitions, especially Instagram in 2012 and WhatsApp in 2014.
Growth decline towards a plateau or collapse: Finally, we also argue in Digital Business Vol I (see Lee & Armstrong, 2023) that it is usual to see a plateau or sharp decline in such growth patterns. In the case of Facebook, the left panes of Figure 3 seemingly shows usership growth decline. Meta’s revenues also started to slow down in the early 2020s, but have lately had a resurgence due to the horizon 2 and 3 strategies discussed in the case and the prior reflection starting to bear fruit. This period may evidence saturation, particularly for Facebook.

How does social media illustrate the concept of abundance?

Facebook’s earlier exponential growth with regard to metrics such as users and revenue can partly be traced to s as described in the reflection question. Facebook as the initial platform, and subsequent platforms like Instagram and WhatsApp, exemplify the 7Ds as discussed in Digital Business Vol I (Lee & Armstrong, 2023): they are purely digital and therefore dematerialized, demonetized (free), and so widely disseminated that they have become ubiquitous. Of course, the final point may lead to the end stage of saturation as discussed further below.

A key point underlying the abundance concept for social media is also that their main factors of production – new content of various types – are user-supplied and frequent. Meta’s platforms do not produce or even really disseminate the photographs, stories, reels, memes and so on which form the nucleus of their content and the reason people log in and scroll: this is all externalized to the users and frequently uploaded by them. Meta merely encourages and orchestrates this abundant and free content, all the while making money from the advertising and data monetization that the presence of their users allow.

How does the Meta story illustrate convergence?

There are a variety of ways in which the Facebook and Meta reflects principles of convergence.

The origins of social media helped to bring technology into the social context in a way never seen before. It undoubtedly got massive, viral uptake due to its ability to solve some pain points (for users, the desire to connect; for advertisers, the imperative to reach and target markets) and meet people where they were at. It also solved certain processes for users, such as how to easily store and share their photographs, birthdays, events, and so on, and enabled advertisers to radically improve their processes of targeting and reaching audiences.

We see many examples of technological convergence in Meta’s history, from convergences of biography, photography, and connection in the initial Facebook platform to the bringing in of AI and marketplaces subsequently to convergences of many technological platforms under the Meta umbrella. The relentless drive of Meta to “give people the power to build community and bring the world closer together”, which is their self-confessed mission statement, seems to drive them to increasing convergences of things.

It was not just stacks of digital technology in these platforms: social media is also foundationally analogue in that it shares interesting visual and auditory things, employs a habit-forming scrolling action, and so on.

Finally, social media deployed through physical devices that were central to people’s lives, namely computers first and later smartphones. It was one of the first interesting things people had to play with in their smartphones, and allowed them to deploy the full range of smartphone physical features such as cameras, smart screen play, microphones, and so on.

Platform business launch strategies in the Facebook story

Following the examples of platform launch strategies, we see Facebook deploying two of these:

Single-sided strategy: Facebook first grew their user side before later bringing on advertisers. This is a commonly used single-side strategy.
Seeding strategy: Facebook started in a specific sub-segment of potential users, namely students, with features targeted to this specific constituency. In fact, they started even narrower, first with Harvard, then ivy-league universities, then other major universities, worldwide universities and Silicon Valley, and so on. By focusing on a small, fairly homogenous but valuable sub-segment (the case talks about how valuable the students were to advertisers), they could dominate that campus space. We pick up on this point in the next reflection. Facebook could then grow off this strong start, having proven their model in a specific space.

Explaining Facebook’s domination of Myspace

We would speculate, using the crucial triad concept, that there are at least three possible reasons for the dominance of Facebook over the more established Myspace. While this is not fully unpacked in the case, the reader could do some extra research in this regard.

Technology. While Myspace was established, Facebook became excellent at constant technological innovations within its platform, such as tagging, poking, and so on.
Market demand factors. In the previous reflection, we note how the seeding strategy of first focusing on students was potentially beneficial. Facebook went viral quickly on campuses partly because it deeply understood students and had tailored features for them at first (such as “Rate my Professor”). Getting this strong and homogenous start even in the relatively small segment facilitated later scaling.
Business model. First, it can be argued that Myspace hardly understood the business model potential of social media, which perhaps was their biggest cause for failure. On the other hand, Zuckerberg worked early with Dean Parker and other Silicon Valley and investment veterans who understood the importance of a strong business model understanding, notably, the potential for revenue streams. As noted in the case, advertisers were quickly interested in the campus nature of Facebook, which was a second benefit of their early seeding strategy. Facebook’s business model allowed the platform to quickly outpace Myspace.

Reflections on ethical concerns at Meta

For this reflection we asked:

How do you think ethical concerns regarding Meta could be improved in the future, especially concerning possible negative effects on children and teens?
Conversely, play ‘devil’s advocate’ and argue for Meta’s right not to be required to moderate content online. What do you learn about reflecting on and researching this perspective, which also seems to be held by right wing governments around the world?

We leave these reflections to the reader.