Facebook held its annual stockholder meeting yesterday, providing an overview of the current state of the social media giant and addressing questions about future projects. One of the key motions of the main agenda points was the decision keep controversial investor Peter Thiel as a member of Facebook's board of directors. Thiel has been in the news of late for bankrolling the legal campaign of former wrestler Hulk Hogan, who was recently awarded more than $115 million in damages from online publication Gawker as part of a sex tape scandal. It was widely expected that Facebook may seek to cut ties with Thiel because of the case, but investors voted to keep him as part of Facebook's advisory team (Facebook's entire board was re-elected).
In addition to the main meeting points, Facebook's management team also held a Q and A session with investors in which they addressed several areas of the business - most of the information presented wasn't necessarily new, but Zuckerberg and Co did provide a few interesting insights into how they work and where The Social Network and their various platforms, like Instagram and WhatsApp, are headed in future.
Long Term Vision
Zuckerberg re-asserted Facebook's mission to "give people the power to share and make the world more open and connected", saying that they're looking to build products that provide every person in the world with a voice and "the ability to share everything they care about with the people they care about". Zuckerberg went on to underline Facebook's current user numbers - 1.65 billion people using Facebook every month, including more than a billion using the platform on mobile devices every single day, and more than $5 billion revenue in the last quarter.
Zuckerberg said that they think of their growth strategy in three different time horizons - three years, five years and ten years. Zuckerberg noted that they have some projects that go on beyond that ten year frame, but that the majority of their investments, at present, are within those three scales.
Their immediate focus, Zuckerberg said, is on improving and expanding the experience for people using the Facebook app, noting that while their current audience is big, it could be bigger:
"...there's 7 billion people in the world, and, from our perspective, you may look at it and say that 1.65 billion people are on [Facebook], that's a lot, [but] I look at that and think we have 5 billion people left to connect".
Zuckerberg said that over a five year period, Facebook's planning to make some of their newer initiatives a bigger part of their overall business, specifically noting the development of Messenger, Whatsapp, video, Instagram and, interestingly, search.
Search has long been a difficult area for Facebook - the most notable project in this area was 'Graph Search' which never quite provided the functionality they wanted. Zuckerberg has noted several times that they're looking to expand their search capabilities on the platform and make it a more significant part of their overall service, though thus far, the only major update was the change to search released last October, which made it easier to find relevant content and posts from your connections.
If Facebook's able to refine and improve search, that could be a major concern for Google - and, of course, refining search makes sense, if Facebook can provide you with more tools on this front, they can keep you on platform for longer. And really, Graph Search was an interesting and valuable concept - Facebook has the capacity to do something big on this front, and given Zuckerberg's mention of it as a major focus, we'll likely see updates coming soon.
As part of their ten year plan, Zuckerberg re-iterated the focus of internet.org - connecting the rest of the world who are not currently able to access the internet:
"Today, less than half the people in the world are connected to the internet. We think that if this is something that we invest in as a company, it'll not only be very good for the world and for all these folks who will get access to all the opportunities of the internet, but over the long term it'll be valuable for our business as well because we'll also be able to address and build a larger community."
Zuckerberg also highlighted their longer term investments in AI to help them develop their messaging apps and show more relevant content in News Feed, while they're also investing in building the next generation of computing platforms.
"We want to make sure that the next big computing platform that comes along is fundamentally social and has people built in as the base of that because that that's how we're going to serve out community best over the long term."
Trending Topics Controversy
The management team was questioned about the recent Trending News controversy, in which it was suggested that Facebook had been selectively editing their Trending News section to highlight or ignore certain stories. Facebook's Vice President of Global Public Policy Joel Kaplan noted that:
"Facebook is a platform for all ideas, that's the vision that Mark has had for the company from the very beginning, and so when concerns were raised as to whether this particular feature in Facebook was living up to that value and ideal, we wanted to get to the bottom of it immediately."
Kaplan said that they immediately undertook an investigation as a result of the accusations laid against them, and they determined that there was "no systemic bias" in the product. Kaplan also noted that they met with conservative groups to ensure they were effectively addressing all concerns as thoroughly, and transparently, as possible.
On a related note, the management team also addressed a question about the way news is shown to users on the platform and the "echo chamber" effect, as it's become known, where people just end up having their own views reinforced because the News Feed algorithm shows you more of what you like, and likely agree with.
Facebook COO Sheryl Sandberg noted that Facebook actually broadens the kinds of views users hear by enabling them to connect with more people beyond their immediate friendship groups and family, thus providing users with exposure to more diverse viewpoints.
Sandberg also noted that more people are staying in touch internationally:
"More people are connected to someone outside their borders today than were a year ago, than were a year before that, and that's another proof point that as we're able to create more human connections, we're able to connect with more people with more diverse voices."
A recent Facebook Research chart which shows estimated average degrees of separation between all people on the network
Zuckerberg's Future Plans
Zuckerberg also answered a question about his future as the man in charge at Facebook, in relation to his growing philanthropic efforts.
"Do you plan to really have hands on running of Facebook for decades to come even though you're obviously going to be involved in charities, or do you see yourself graduating to like a Bill Gates role where he's more involved with the charities than running Microsoft?"
"Yes, to the original question - I plan on being involved in running Facebook for a very long time."
Zuckerberg also discussed the future of virtual reality and how Facebook plans to make the technology more social. Zuckerberg noted that Oculus is working on a project called Oculus Touch which is "the hands counterpart to the headset" which will enable users to reach out and grab things and change virtual spaces.
Zuckerberg said that they've developed a ping pong game as a basic example of how the system works, which enables users to play ping pong in a full immersive virtual space - and feels like you're there with the other person.
"I'm really excited about how VR is going to bring people together in new ways and give you this feeling of presence like you're there with people who you might not have the opportunity to be there with in person, in real life"
Integration of WhatsApp/Messenger
In response to a question about a possible merger of WhatsApp and Messenger, Zuckerberg said that they currently have no plans to combine the two.
Zuckerberg noted that even in nations where WhatsApp or Messenger are growing the fastest, the other one is also typically growing, which shows there's a lot of space for both of them to expand on their own because the philosophies of both apps are very different - WhatsApp is much more utilitarian, "it's very basic and focussed on speed and having a simple tool that people can use", while Messenger is more focussed on expression and giving users the opportunity to express themselves in different ways.
Facebook in China?
In response to a question about the possible expansion of Facebook into China, Sandberg noted that Facebook's mission is to connect the world, and China is obviously a big part of that, which clearly puts it on the agenda as an area Facebook is looking to expand into at some stage.
Sandberg said they're learning about the Chinese market and they're working with some Chinese businesses to help them sell their products overseas.
Advancing News Feed
Zuckerberg also discussed their work on artificial intelligence tools which will one day be able to read the texts and analyze the videos and photos posted to Facebook in order to improve the News Feed algorithm and better match relevant content to each user.
"Right now the way that we rank News Feed for people is we look at what your friends are posting and the Pages that you follow, what they're posting and how many people have engaged with those posts and try to figure out what are gonna' be the most interesting things and show to you first, , but the reality is there are millions of posts that are available for you that people share publicly every day, and right now we don't understand the meaning of those posts. With AI, in the future, we'll be able to have technology that can actually read the text or look at the video and understand what it means and whether it matches up to your interests."
Zuckerberg said there's no reason why they can't use these tools to help grow the size of, and depth of engagement with, the platform over the next several years.
Zuckerberg also discussed the monetization strategy for WhatsApp, saying that the first step is to build up a product that people love:
"...that's the kernel of everything, you can't build anything valuable if you don't have that".
From there, Zuckerberg said the next challenge is in broadening the behaviour on the app so it's not just people talking to their friends, but it's also people communicating with businesses. The Facebook team follow a playbook for this, Zuckerberg said, noting that they've used the same strategy to grow Facebook over time, and they're now doing the same with Instagram,
The second stage of the Facebook playbook for platform monetization involves facilitating 'organic business behaviours' on the app:
"..making it so we provide tools for businesses to use out products for free to start engaging in the community, to create value for people who are using the product, but we don't start charging for that yet."
Zuckerberg said that this is how they developed Pages on Facebook, of which there are now more than 50 million business Pages on the platform. That then builds the foundation on top of the consumer behaviour where now you have an active business community. Once this happens, and businesses are getting value from the platform, then, Zuckeberg says, those businesses then want more, and they look to Facebook to provide new options to increase distribution and reach, which then enables them to implement paid options.
Instagram's new business profiles - coming soon if you don't have them already
This, Zuckerberg says, is the same process they'll follow for both WhatsApp and Messenger, which are now both moving into stage two, where they build an organic business interactions process via these apps.
While Zuckeberg only briefly touched on this, it's a really interesting insight into how they evolve their business platforms, and answers a lot of questions users have had around Instagram monetization and how Facebook looks to make money from brand options.
The team also fielded a question about whether Facebook's losing touch with teens and younger audiences. Facebook CFO David Wehner noted that the platform currently has the largest audience of global teens, and teens remain very engaged on Facebook. Wehner also said that they're building a range of new products like messaging options and Instagram which are also very popular amongst younger users, so they're not necessarily losing touch as some have reported.
Facebook's management team also answered additional questions around advertising growth, what they're doing to detect and eradicate illegal activity on the platform and what sort of legacy Zuckerberg hopes to leave his daughter in Facebook.
It's an interesting discussion, and one that clearly outlines how Facebook works, where the platform is headed and what you can expect to see in future.
You can listen to the full Facebook 2016 Annual Stockholder Meeting here.