Facebook’s Challenge: Making Money in Mobile World

The following is an excerpt from an article in 

The New York Times
Friday, August 24, 2012

Facebook’s Challenge: Making Money in Mobile World

By BRIAN X. CHEN

MENLO PARK, Calif. — At Facebook’s headquarters here, mobile devices are everywhere. The first thing visitors do is sign in on iPads at the front desk. Employees at the campus coffee shop use iPads as cash registers. Instead of sending e-mails, Facebook employees prefer to use the company’s messaging system, which pops up new messages on both mobile devices and PCs.

Mobile is clearly on the company’s mind, especially now that people are spending more time using Facebook through mobile apps than on computers. And on Wall Street, investors are putting pressure on Mark Zuckerberg’s social network to master the mobile world so it can speed up growth and lift its sagging stock.

But the challenge for Facebook, along with other companies like Google that got their start on the Web, is figuring the best way to serve ads to mobile users without cluttering up their small screens and driving them away in frustration. For now, mobile ads bring in less money than standard Web ads, so the shift to mobile threatens to undermine Facebook’s revenue. Facebook’s executives say the company is diving deep into mobile, starting with new versions of its apps for the iPhone and iPad, which it released Thursday. Users had complained that the apps were sluggish; more than half of those who rated Facebook’s iPhone app in the Apple App Store gave it one star out of five. The new apps are faster because they were rewritten in the native programming language of Apple’s devices, replacing most of the Web-based technology used in previous versions.

The apps are part of what Facebook executives say is a transformation into a “mobile first” company. Developing mobile products has been made a priority, they said in recent interviews, and every team inside the company has been reorganized with the goal of inserting mobile into its DNA.

“We have basically retooled and focused the company around mobile,” said Mike Schroepfer, vice president for engineering of Facebook. “It’s been a huge change.”

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