The death of Facebook

With a $16 billion IPO behind it and its billionth user on the horizon, Facebook has made it hard to imagine a world without it. Yet the technology industry is notorious for booms and busts. Can you remember the last time you fired up a Netscape browser, visited a GeoCities website, or invited a friend to join AOL Instant Messenger? I'm convinced that Facebook is as doomed to fail as those ventures.

To remain vibrant and relevant, Facebook must overcome daunting challenges. Unless it can deftly incorporate future waves of innovation, it faces the fate of other once-successful technology companies: death.

Listen closely and you can hear the death knell: Facebook is no longer cool; the once-clean interface is cluttered; and better applications are taking off even faster than Facebook did.

Already, Facebook is in danger of being really good at something people are no longer interested in: sharing content with their acquaintances. And with around 85 percent of its revenue coming from advertising, it lives or dies by its number of users. Moreover, the larger it becomes, the more difficulty it will have adapting to the technological advances and user expectations of tomorrow.

For example, Facebook was once a top destination for photo-sharing. However, as consumers shift to taking photos with smartphones instead of digital cameras, the network's photo-sharing experience is beginning to feel dated and tired. The company acquired the photo-sharing service Instagram to address that issue, but it now faces the daunting task of integrating the services.

In addition, many people already find Facebook too complicated. Adding features has made this problem worse, not better.

Facebook's ability to improve the user experience is also limited by its fundamentally flawed model of social interaction, which is based on the idea that every individual has a single social identity. This may have been true for the college students who were its first users, but it does not account for the multiple roles of adults in work, community, and family life. As a college professor, I interact with my students one way and with my colleagues, friends, relatives, and neighbors in others.

Another flaw in Facebook's presentation of social relationships is that until recently, it required all social connections to be reciprocal. That is, you can view my updates only if I agree to see yours. While the addition of Facebook "followers" acknowledges this limitation of Facebook "friends," it further confuses an already cluttered user experience.

As the best-known social-networking site, Facebook is also a primary target of both abusive practices and backlash. It seems as if each new feature — most recently, timelines and frictionless sharing — renews privacy concerns. Some employers are now asking job applicants to share their private information on Facebook, making a long history of usage a potential liability instead of an asset.

With declining benefits and increasing risks, users are more likely to leave. This is a deadly result for a company in a mature market.

Five years ago, few of us were using Facebook. Five years from now, that will likely be true again. The future of social media will combine people we know (our social networks), the topics we are interested in (interest networks), and where we are (location-based services), all optimized for smartphones, tablets, and other mobile technology. Facebook is a dominant social-networking platform, but it barely competes in these other categories.

Users flock to the services that provide the most compelling experience; advertisers and brands follow. As users move to new options, a downward spiral into irrelevance can happen virtually overnight. The technology graveyard is full of former market leaders like Netscape, Geocities, and AOL, all of which failed to provide the next big thing. The odds are that Facebook will, too.

Steven L. Johnson is an assistant professor of management information systems at Temple University's Fox School of Business, where he teaches social-media innovation. His website is http://stevenljohnson.org.