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Facebook’s Growth: A Tale Of Two Headlines

Filed by KOSU News in Business.
June 11, 2012

I love this. Here is a headline today at The Wall Street Journal’s online edition: “Days of Wild User Growth Appear Over at Facebook.”

And over at The Next Web: “Facebook is eating the world, except for China and Russia.”

And the best part is the two sites really are telling the same story.

The Journal points out that the number of Facebook’s unique visitors in the U.S. rose only 5 percent in April from a year earlier. The social network’s U.S. growth has gone from torrid to tepid. Also bad news for Facebook: The amount of time users spend on the site is decelerating.

But when you start poking, these numbers they are still not so bad.

As the Journal goes on to explain, “In some ways the slowdown is to be expected. Facebook has already grabbed 71% of all the 221 million U.S. Internet users, according to comScore.”

And that “deceleration” I mentioned earlier means the time folks spend on Facebook is still growing, just not quite as quickly as it was before. In fact time spent is up — yes, up — 16 percent.

And the U.S. is one of Facebook’s most mature markets. When you look around the world, the social network is still growing quite nicely. This map shows how quickly it’s become the most popular social network everywhere except Russia and China.

So why are the Journal and Web-heads telling such different stories about Facebook when they are basically working from the same data set?

Money. That’s what tends to matter most to The Wall Street Journal’s readers and editors. That’s how they evaluate a company. And in purely financial terms, becoming the number one social network in Nigeria doesn’t do much for you. You are not going to justify your sky-high stock price selling ads in Uruguay. It was Facebook’s fast growth in wealthy countries around the world that powered investors’ imaginations, but in many of those regions Facebook has run out of room to grow. [Copyright 2012 National Public Radio]

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