Comscore released a report this week detailing how the majority of social network interaction is driven by smartphones. As reports surface about Facebook’s struggles to realize stronger advertising revenue in anticipation of their IPO, this is a shocking revelation and one that raises serious concerns about Facebook’s true value.
The issue isn’t in the aggregate number, which is near a 50 / 50 split mobile to PC. What is concerning is that the dominant smartphone demographic according to the Pew Institute is 18-49 (though one assumes this trends younger). Without mobile, the Facebook phenomenon is a completely different creature, and no one can say with certainty what that is.
Yesterday, Facebook submitted an S-1 Filing with the SEC with the following statement: “We do not currently directly generate any meaningful revenue from the use of Facebook mobile products, and our ability to do so successfully is unproven.”
A significant majority of Facebook users in the prime advertising demographics are by Facebook’s explicit admission unreachable. What does it say about the direction of the company when such a huge blind spot is revealed a week before their IPO? And for businesses advertising with Facebook, does this mean that you haven’t been reaching who you thought you have been reaching with your marketing dollars?