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Facebook Inc (FB): Mobile Asia To Drive Future Growth

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Facebook Inc (NASDAQ:FB) is celebrating its 10th birthday today. As growth in the Western markets continues to slow, a big challenge for the world’s largest social networking company is to maintain its growth rate. According to AFP, the company will find its next big growth opportunity in emerging Asian countries, especially mobile users. Facebook was banned in China in 2009. So, most of the company’s future growth in Asia is likely to come from the other populous countries like India and Indonesia.


India to become the biggest market for Facebook this year

Research firm eMarketer estimates that India will overtake the United States as the nation with the most Facebook Inc (NASDAQ:FB) users by the end of this year. Currently, India has about 93 million Facebook users compared to 150 million in the U.S. But the number of Indian users is estimated to reach to 152.4 million, beating the U.S. figure of 151.1 million. Despite immense growth in Asia, the social networking giant can’t afford to sit idle because local competitors are threatening it in countries like Indonesia. Even on mobile, it’s facing stiff competition from WeChat, Line and WhatsApp in Asia.

Facebook India’s chief of growth and mobile partnerships, Kevin D’Souza, says Internet penetration is still low in Asian countries. Only 200 million people in India have access to the Internet. Though more than 400 million Indians own a cell phone, only 5% of them are smartphone users. So, the key to Facebook Inc (NASDAQ:FB)’s growth in emerging markets is to encourage access to feature phones. Most of the Asian users sign up for the social network on their mobile devices.

Where will Facebook’s next billion users come from?

More than 100 million people around the world are using “Facebook for Every Phone” app that’s especially designed for non-smartphones. And a large number of Facebook Inc (NASDAQ:FB)’s next billion users will be the ones using this app. The app comes preloaded on Nokia Asha 501 feature phone. The company will also benefit from the prominence of English-speaking population in India and the Philippines. About 33% of the the Philippines’s total population has access to Facebook.

Facebook Inc (NASDAQ:FB)’s advertising revenue jumped 76% to $2.34 billion during the fourth quarter. And mobile advertising accounted for more than 53% of its total ad revenue. The company’s mobile daily active users (DAUs) increased 49% to 556 million, and mobile monthly active users (MAUs) went up by 39% to 945 million. Most importantly, the number of Asian monthly active users went up from 298 million to 368 million. Indonesia has 65 million Facebook users.

Facebook Inc (NASDAQ:FB) shares surged 1.55% to $62.43 at 9:32 AM EST.

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