On Paper, Facebook's a Different Story
Facebook on Thursday announced next week's launch of Paper, a free app for iOS that combines user and curated content into a personalized news medium.
Users can create stories as well as receive stories based on their interests and organized into sections. Section stories are chosen by both human and machine curators.
The sections cover a variety of subjects -- from sports, world news and animal pictures to business, photography and food. Although section stories on all phones initially will be the same, Facebook has said that may change in the future, with section stories being tailored to an individual's tastes.
Stories can come from a number of sources, both mainstream and eclectic.
As with the popular Flipboard app, stories have splashy layouts that are heavy on pictures and light on words. In Facebook's promotional material for the app, there was no advertising in the "distraction-free" story layouts.
"It's got one big difference with Flipboard, and that is it's a pretty effective way for people you follow on Facebook sharing things with you," said Dan Kennedy, an assistant journalism professor at Northeastern University.
"This looks like Flipboard, but it has a strong basis in sharing," he told TechNewsWorld.
Navigation within the app is thumb-centric, which is very convenient for one-handed operation. Sliding your thumb across the screen takes you left and right through stories. Tapping a story opens it up; pinching it closes it.
Photos within stories need not be confined to the iPhone's screen size. You can pan large or panoramic photos by tilting a phone.
Paper is the first app brought to market by Facebook Creative Labs. The venture within the social network allows small teams acting with entrepreneurial fervor to create standalone mobile apps. It's part of a larger strategy by the company to push out more single-purpose apps rather than stuff more functionality into the core Facebook app.
"Facebook is trying to diversify beyond its core offering," Jan Dawson, chief analyst with Jandaw Research, told TechNewsWorld.
"Right now, if the core social network experienced a drop in popularity, since the whole business rests on that, things would quickly go sour," he explained. "They're vulnerable in that sense, especially since there are signs that it may be dropping off in popularity among certain parts of the population."
Bring On the Ads
Paper is part of an ongoing effort to produce products that aren't the kind of pure social networking products Facebook started with, Dawson said.
The app repackages some of the most popular aspects of Facebook, namely images and videos.
"This is new kind of way for people to discover and immerse themselves in that kind of stuff," Dawson noted.
"It broadens the range of content that your average user would be exposed to with just the Facebook app. For a company that relies on advertising, the more time people spend in your apps looking at content, then the more you make," he pointed out. "This is a great way of doing that."
Although there initially won't be any advertising in Paper, that's unlikely to last. "They'll start adding advertising pretty quickly," Dawson predicted.
Cracking the Ad Nut
Advertising has been a major nut for apps like Paper to crack.
"The difficulty continues to be revenue generation and ad conversion," Rob Enderle, president and principal analyst with the Enderle Group, told TechNewsWorld.
"Finding a medium that displays news and ads in such a way that people actually purchase stuff remains problematic," he said.
"Facebook is still on the bubble," observed Enderle. "Advertisers are paying for ads, but they're not getting the value for them. Facebook realizes that unless that's corrected, that ad revenue is going to go bye-bye."
What's more, while Facebook continues to expand globally, much of that growth is in places with users less tempted to buy what they see in ads.
"Most of the people Facebook is adding are from parts of the world that have a far lower revenue per user than the U.S. does," Dawson said. "Most of the users joining the service over the next few years are going to be adding much less revenue than existing users, so Faqcebook is going to have to find a way to keep revenue growth going."