Investors Go Gaga Over Facebook’s Search Engine Plan


In his first public appearance after the Facebook Inc (NASDAQ:FB) IPO debacle in May, CEO Mark Zuckerberg said, during his talk at TechCrunch Disrupt, that the social media giant will foray into Web search market sometime in the future.  He said that  Facebook Inc (NASDAQ:FB) is uniquely positioned to exploit this opportunity.

Investors Go Gaga Over Facebook's Search Engine Plan

Facebook Inc (NASDAQ:FB) stocks have jumped almost 12 percent after the talk on Tuesday. Zuckerberg highlighted that the company is making progress in its mobile business, and promised that the company has a bright future. Facebook, with its over 955 million users, generates over a billion queries every day.

Odey Falls -2.5% In Q2, Bets On Economic Recovery

activist short selling Investing investThe LF Brook Absolute Return Fund lost -2.52% in the second quarter of 2021, compared to a positive performance of 7.59% for its benchmark, the MSCI Daily TR Net World Index. Year-to-date the fund has returned 4.6% compared to 11.9% for its benchmark. Q2 2021 hedge fund letters, conferences and more According to a copy Read More

“Facebook might be the only company on earth that I think could truly go up against Google Inc (NASDAQ:GOOG) and win on the search side,” said Gerry Campbell, a Web search expert who has worked on many search engine projects with a number of companies.

Google vs. Facebook?

Well, the giants will not be competing head on, but they will affect each others business for sure. The user intent will be different on  Facebook Inc (NASDAQ:FB) from those on Google. Facebook isn’t planning to launch an independent search site. Instead, it will do a “Social Search”. The Menlo Park, California-based social networking site already offers a search feature within its social network for users. The company will expand the functionality of its internal search engine to help users find what they are looking for. Zuckerberg said:

“The legacy around search is you get these search engines like Google and Bing and what Yahoo was doing before. You basically type in keywords and the search engine runs some magic to tell you what it thinks the answer is that matches your keywords. But I think search engines are really evolving to give you a set of answers, not just ‘type in something and show me some relevant stuff’, but ‘I have this specific question, answer this question for me’.

When you think about it from that perspective, Facebook is pretty uniquely positioned to answer the questions people have. What sushi restaurants have my friends gone to in New York in the last six months and Liked? Or which of my friends or friends of friends work at a company that I’m interested in working at because I want to talk to them about what it’s going to be like to work there? These are questions that you could potentially do at Facebook if we built out this system that you couldn’t do anywhere else. And at some point we’ll do it. We have a team working on search.”

From the above statement, it’s clear that Facebook Inc (NASDAQ:FB) search will be oriented toward facts, such as where a user’s friend checked in, or where he worked.  On the other hand, over 3 billion daily searchers on Google Inc (NASDAQ:GOOG) are basically looking for subjective answers or opinions, not such facts.

The answers to factual questions related to friends are available only in their profile, check ins, biographical data, and photos on the social network. And, these are firmly in Facebook’s grip. Google has tried for years to get those facts by foraying into social networking, but it hasn’t been very successful.

For outside searches,  Facebook Inc (NASDAQ:FB) has tied up with Microsoft’s Bing. That partnership could continue until Facebook launches its own search engine and expands it into a full-fledged search engine company.

We think there will be certain restrictions on Facebook with this model. Google Inc (NASDAQ:GOOG) generates over $40 billion in advertising revenue every year, but Facebook doesn’t earn even one-tenth of that amount. Why? It’s because, on Facebook search, people are looking for other people. Not something specific like a product, service, or brand.

People who use Google, also use Facebook Inc (NASDAQ:FB). When they are looking for something specific, they always go to Google Inc (NASDAQ:GOOG). They use Facebook only when they are checking in with their friends, or looking for other people.


No posts to display