Facebook Inc (NASDAQ:FB) has been facing a plethora of troubles since its initial public offering in May. The firm has stood resolute, however, on its user numbers which remain solid and do not look easily shaken. the wars between social networks have appeared over since MySpace’s demise. Now, it seems, there is room for Facebook and a group of highly specialized social networks like Twitter and Linkedin Corporation (NASDAQ:LNKD).
That has begun to change however. Google Inc (NASDAQ:GOOG) released its social network Google+ as a direct Facebook competitor last year. The site has grown to a respectable 170 million users in less than a year. Now Samsung is starting its own competing network.
Recently, Bruce Greenwald carried out a virtual Fireside Chat with Li Lu, the founder and chairman of Himalaya Capital. Greenwald and Lu covered multiple topics during the discussion, addressing everything from the value investor's approach to appraising businesses and what he had learned from his great friend Charlie Munger. The duo also discussed China's economy Read More
The news was broken earlier today by a Korean Newspaper, The Korea Times. Samsung has cleverly dubbed the network “Samsung Facebook” internally. The service is apparently designed to work across multiple platforms including mobile devices and smart televisions.
Samsung hopes to initially offer it to users of its devices but is not ruling out a spread to general use across several devices. The product is expected to be released in the first quarter of next year at the very earliest.
As Apple Inc. (NASDAQ:AAPL) moves closer in line with Facebook Inc (NASDAQ:FB) a clear war is lining up between the major players in the digital sphere. Samsung is making a brave move by competing directly with Google who the device maker partners with on smart phones and tablets.
Facebook will not be overly fazed at this early stage by the arrival of a new payer into the social networking sphere. The firm’s incumbency is large and in social networking incumbency is a difficult thing to move, though it has happened in the past.
Facebook displaced MySpace and before that MySpace displaced Friendster as the world’s eminent social network. Samsungs offering, coupled with the popularity of their mobile devices, may offer a reasonable alternative to Facebook. That could spell disaster for the company.
If investors’ views on Facebook remain as worrisome over the next year as they are now, any movement of users away from the site could lead to quick rumours of its demise and substantial moves in the firm’s share price.
Samsung already have a clear path into users lives. If, and it’s a big if, they manage to create a social networking service that users prefer to Facebook they might just be the ones to take down the current monopoly and leave Facebook investors reeling.
UPDATE: Samsung announce that they have no plans to launch any Facebook-Like service.