Paul Adams, who was previously Facebook’s global head of brand design, has joined a startup called Intercom, where he will be serving as head of product design.
Adams told me earlier that he wasn’t looking to leave Facebook, but he had also been advising Intercom and became excited about the opportunity. The startup, which is backed by Twitter co-founder Biz Stone, 500 Startups and others, offers tools for online businesses to track every interaction with a customer and to use that data to deliver personalized messages and offers.
When I suggested that this sounds like a shift from Adams’ previous work in advertising, he didn’t entirely disagree, but he also said Intercom’s work ties into the themes he’s been exploring at Facebook, which have also been expressed in his talks and his book Grouped. (In addition, Adams is known for his work at Google, particularly a presentation that seemed to outline many of the ideas that eventually shaped Google+.)
Adams argues that in the future, businesses’ interactions with potential customers are going to be much more personal and relationship-based, rather than following the one-to-many broadcast model of traditional advertising. Intercom facilitates those company-to-customer interactions, and he added that it’s not just a way to deliver slightly-more-targeted marketing emails.
“In the past … companies tried to minimize customer interaction,” Adams said. “They didn’t want customers to talk back to them — that was overhead. Minimizing customer interaction is a very outdated model from a pre-social web world. Intercom is very much about intimacy, very much about being personable.”
Adams will be working out of Intercom’s Dublin office — he said he had already made the move from Silicon Valley to Dublin for personal reasons.
After being acquired by Facebook, the mobile back-end service Parse has been busy integrating itself into the company, as well as launching new services like web hosting for developers.
The service has built tools to help developers focus on the front-end of their product, while handling all of the messy back-end things like cross-platform compatibility and testing. Naturally, Facebook integration is easier than ever for mobile developers thanks to the acquisition. Its been six years since Facebook’s Platform launched, and during a whiteboard session at its Menlo Park headquarters, the company discussed just how far its come.
Doug Purdy, Director of Product Management, and Mike Vernal of Facebook Platform led the discussion. Ilya Sukhar, who recently joined Facebook with Parse, sat in on the discussion as well.
Purdy set up the conversation about next steps by saying: “We’ve been thinking about how we can provide tools to developers to enable a more cross-platform world. We’re trying to create a platform that developers can build something that spans over devices and makes people the center. Regardless of the device that you or your friends are on, everyone can have a rich experience.”
Sukhar, co-founder of Parse, talked a bit about Parse’s beginnings and day four at Facebook:
If you think about applications broadly, there’s the front-end, and below the hood there’s a lot. The data side, how you sync it back to the server, the databases. None of these things bring value to the users or differentiate apps. Our SDKs make this dramatically easier for everyone.
I was originally building mobile apps myself. I was spending a lot of time building things over and over again, things that were quite hard and painful. It’s time that I could have spent on the actual user experience or the utility of my app. So I decided to build Parse. We’ve grown from one person to 24. Since day one, we’ve had 80K apps, 200M installed apps.
Generally, the community is very excited. All of our metrics are up and it’s been a really fun time.
It’s good news that things are going smoothly, and it’s clear that Facebook sees Parse as a huge part of its developer ecosystem push for the future. As far as new services, Sukhar says the team, which is still operating independently, speaks to developers about what should come next. One of the top features that gets requested is functionality around push notifications and offline mode.
The clear value for Facebook is that Parse’s platform could be the easiest way to urge developers to use Facebook ads. Once you get rid of the complexity of building out a backend for an app, you can pay attention to promoting your app more. Hopefully that promotion will come via Facebook, as Purdy mentioned comScore’s findings that the site is the top way to discover new apps.
On whether less backend worries will lead to more promotion, Sukhar said: “This is something we’ve heard: ‘Parse has done well for me to get things out to market, but now I need users.’ We don’t have anything specific to announce today, but it’s clear that Facebook has the solution.”
Amazon has reportedly submitted plans for a new futuristic headquarters in Seattle that combines a skyscraper and a tri-sphere, bio-dome-like structure. According to the plans, the structure will be able to hold various forms of plant life and become a place where employees can “work and socialize in a more natural, park-like setting.”
Because, God forbid, employees walk to the park that’s three blocks away.
Here’s an excerpt from the plans (also, hat tip to GeekWire for the find):
While the form of the building will be visually reminiscent of a greenhouse or conservatory, plant material will be selected for its ability to co-exist in a microclimate that also suits people. To encourage growth and maintain the health of the plants, the building’s interior will include high bay spaces on five floors totaling approximately 65,000 SF and capable of accommodating mature trees. The exterior enclosure will be highly transparent and be composed primarily of multiple layers of glass supported by a metal framework. In addition to a variety of workplace environments, the facility will incorporate dining, meeting and lounge spaces, as well as a variety of botanical zonesmodeled on montane ecologies found around the globe. The building will be anchored at either end by publically accessible retail spaces entered from 6th and 7th Avenues.
Generally, it all sounds very cool and very futuristic and very trendy (read: Apple did the whole “plans for a spaceship” thing ages ago). However, it’s interesting to see how the biggest companies in tech are tackling the issue of working in an office or with a more loose structure.
Remember, everyone made a pretty big deal out of Marissa Mayer’s recent policy change that requires all Yahoo employees to work in an office. And just recently she announced that Yahoo would be taking up space in the Times building in New York’s Times Square, which is capable of housing up to 700 employees.
As it stands now, all of the big four tech companies — Google, Apple, Facebook, and Amazon — favor keeping employees in the office.
Google has one of the best campuses you could dream of, both in Mountain View and in New York, feeding employees free lunch from world-renowned chefs. Apple is working to build out one of Steve Jobs’ final projects, a new spaceship office. Facebook has the same diversions: chess boards, and video games, and basketball courts, and free lunch.
So of course, the fourth horseman in the race, Amazon is devising its own tricks to keep employees at the office as long as possible. It’s a win-win: Employees do more and better work due to a pleasing and comfortable work environment, and employers get more, and better work, out of their employees.
Also, there’s a perfectly good park just three blocks from the new campus.
Here’s the full set of plans:
Amazon’s new HQ design by John Cook
[Biodome rendering via NBBJ]
Google is under fire in the UK for its tax practices in the country, and a new key witness (who spoke to The Sunday Times) might put them in deeper hot water when he hands over a reported 100,000 emails and documents to the British Revenue & Customs (HRMC) services. Barney Jones, a former Googler who was at the company between 2004 and 2006, says he has material proof that Google’s London sales staff which would negotiate and close sales for the UK market, despite claiming its Dublin HQ handled finalizing all deals.
Jones was prompted to speak out by testimony given to the Commons Public Accounts Committee (PAC) last week by Google VP Matt Brittin, who said that London-based Google staff were never closing any ad sales deals, though some selling efforts were made there. Brittin had previously gone on record in November 2012 with statements asserting that no one in the London office was doing any kind of ad selling.
The matter of where the deals were finalized is especially important because if a sale closes in London, it’s likely they’d be taxable in Britain, rather than in the extremely low tax-rated Ireland. Jones told the Sunday Times that Google is fully aware of this, yet there are still records of Google staff closing major deals from companies like eBay and Lloyds TSB, but Google doesn’t seem at all certain that any of the documentation will absolutely prove that it has done anything strictly against UK tax law, according to a statement provided by Google Direct of External Relations Peter Barron to the Sunday Times.
“As we said in front of the public accounts committee, it is difficult to respond fully to documents we have not seen,” the statement reads. “These questions relate to Google’s business in the UK going back a decade or more. None of the allegations put to us change the fact that Google pays the corporate tax due on its UK activities and complies fully with UK law.” Google reiterated this statement to TechCrunch when we contacted them for comment.
Ireland uses its lower corporate taxation rate, which is 12.5 percent, or a little over half of Britain’s 23 percent, to attract big names who base their European corporate headquarters there, including Apple and Facebook in addition to Google. The search giant is currently under fire from UK parliament members for its tax practices, thanks to a Reuters investigation that revealed statements it made last November to the PAC about its London operations may not have been entirely accurate.
Amazon is next in the PAC’s sights for its UK tax practices, as Reuters has also recently uncovered evidence to suggest that it, too, is doing a lot of selling through an autonomous London-based unit, despite routing its sales on paper through a tax-exempt affiliate based in Luxembourg. In fact, for most on Google’s footing, avoiding taxes seems to be the exception, not the rule, and a recent piece by V3′s Madeline Bennett explains that even if this fresh round of hearings reveals that these schemes do run afoul of UK tax regulations, it’s unlikely we’ll see situations change all that dramatically. Governments are too dependent on the general economic benefits of hosting big corporations, and get too much out of awarding them contracts, she says, to risk doing long-term harm to those arrangements.
Still, what Jones claims to have would be incredibly embarrassing for Google, especially if it spells out in no uncertain terms that closing deals was regularly handled by Google’s London staff, in direct contradiction to what Brittin has told the committee, but until we see the goods, there’s no telling how deep down the rabbit hole his information actually goes.
$FB is still stuck at $26.25, way down from its $38 IPO price, but it’s made important progress since going public a year ago. Daily users up 26%, mobile monthly users up 56%, and revenue up 38% are some highlights. It’s running out of people to sign up in the developed world, but with this growth and no serious competitor in sight, it’s survived its hardest year yet.
- Likes – 4.5 Billion – Up 67% – Average number of likes generated as of May 2013, up from 2.7 billion likes generated daily in August 2012
- Content Items Shared – 4.75 Billion – Up 94% – Average number of content items shared daily as of May 2013, up from 2.45 content items shared daily in August 2012
[Stats and images provided by Facebook]
Likes and sharing are growing faster than Facebook’s user count, indicating strong engagement. This contradicts rumors that people are tuning out of Facebook. Zuckerberg’s Law, the CEO’s Moore’s Law-style theory, states that people will share twice as much every year. Facebook almost made good on Mark’s claim. It’s important that Facebook keeps that number growing as it’s shared content that keeps people visiting Facebook and seeing its ads.
To do that, Facebook is working on the more immersive mobile experience Home which has increased time spent on Facebook by 25% for its small number of active users. More time spent could lead to more sharing. This year it doubled the speed of its massively popular iOS and Android by switching them from HTML5 to native architecture, which lead to longer session times. It added content-specific news feed to boost browsing, and launched Graph Search to pull additional value out its data and get people to contribute more.
It’s also been beefing up its mobile SDKs for iOS and Android to make it easier for apps to share content to Facebook. That’s a big reason Facebook cares about helping its developers grow — they’re scratching each other’s backs.
- Monthly Active Users – 1.11 Billion – up 23% – As of March 2013, up from 901 million MAUs in March 2012
- Daily Active Users – 665 Million – up 26% – On average as of March 2013, up from 526 million DAUs on average in March 2012
- Mobile Monthly Active Users – 751 Million – up 54% – As of March 2013, up from 488 million mobile MAUs in March 2012
- Instagram – 100 Million Monthly Active Users – As of February 2013
Facebook is still signing up people pretty quickly, but all users are not created equal. While it earned $3.50 per user in the U.S. and Canada in Q1 2013, it only made $0.50 per user in much of the developing world including India and Brazil. Those emerging markets are where Facebook is getting most of its growth, meaning each subsequent 100 million users added is worth less than the last.
Growth in mobile has a similar issue. Facebook can show as many as seven ads per page on desktop whereas it has to be more careful not to overwhelm the small screen on mobile. So as Facebook’s users shift their access medium to mobile, it may earn less on each of them. Facebook is hoping that getting developers to pay for mobile news feed ads to get their apps discovered could counteract this, and that market is poised to grow as more businesses launch apps and the developing world switches to smartphones.
Overall, though, Facebook is still growing strong nine years after launch. The network effect of its ubiquity should not be underestimated. Dislodging Facebook as the premier general purpose social network will require something that’s not just better, but much, much better. Competitors might pick away at certain use cases, but are unlikely to replace it as the core identity provider for the web. Considering Facebook’s willingness to buy out threats like Instagram (which is still growing quickly in the first world), could stave off disruption and let it reign for years to come.
- Local Businesses – 16 Million – up 100% – Number of local business pages as of May 2013, up from 8 million in June 2012
- Promoted Posts – 7.5 Million – Number of promoted posts made from June 2012 to May 2013
- Revenue – $1.46 Billion – up 38% – In the first quarter of 2013, up from $1.06 billion in the first quarter of 2012
- Ad Revenue – $1.25 Billion – up 43% – In the first quarter of 2013, up from $872 million in the first quarter of 2012
- Employees – 4,900 – up 38% – As of March 2013, up from 3,539 in March 2012
- Game Payers – 24% more – Increase from March 2012 to March 2013
There’s no doubt about it. Going public made Facebook focus more on making money. It went from nearly zero revenue on mobile to $375 million a quarter, or about 30% of its total ad revenue. That in large part came thanks to the mobile app install ads it launched late last year. These let developers promote their apps in the Facebook news feed with ads that link straight to download pages in the Apple App Store and Google Play. These stores are getting more and more clogged with apps, inspiring developers to pay Facebook to get found.
Facebook also made big headway with Facebook Exchange, its retargeted ads that use people’s browser histories to show them highly relevant ads. FBX is absorbing advertiser budgets set aside for retargeting. Less successful has been Facebook Gifts, its entrance into direct e-commerce. Gifts has failed to produce meaningful revenue and may need to be overhauled to get more users purchasing real-life presents for their friends. Growth in payments revenue has been relatively slow too, as more game developers move from Facebook’s web canvas where it earns 30% to mobile, where Apple and Google get that cut.
One opportunity that should excite investors is that Facebook started showing ads in Graph Search. While they use the standard Facebook targeting now, they’re expected to incorporate keyword targeting, which could make them a more direct competitor to Google’s wildly lucrative AdWords business. The increasing technological savvy of local businesses could be a boon to Facebook in the future. Right now few of them actively buy social ads, but expect revenue to shift towards Facebook and away from less targeted print and telephone book ads in the future.
Still, Facebook isn’t trying to make as much money as it could. Another year went by without TV commercial-style auto-play video ads (though they’re rumored to be getting closer to this), and it even paused its experiment with a mobile ad network. If Facebook built out these streams it might piss some people off or make them feel like they data is being exploited, but it could definitely produce a huge boost in revenue. Off-site and off-app ad networks could let Facebook leverage its enormous wealth of personal data to power ads elsewhere so it can earn money without showing more ads on its own properties. That potential more than any is an argument for why Facebook is undervalued.
Most importantly of all, Facebook’s efforts to earn more money have not significantly impeded its mission of connecting the world. There are definitely more ads on Facebook, especially on mobile, but the data shows that they’re not annoying users enough to reduce their engagement.
Facebook has grown up. It’s no longer the red-hot startup that could double its user count every year. And it’s not the mature corporation churning out amazing profits by squeezing every last dime out of its data and usage. But Facebook has weathered the storm of going public without letting it destroy its regard for the user experience. It’s now a fundamental utility for most of the world. If it can keep from getting too greedy and stay focused on the long-term health of its community, it will have plenty of time to figure out how to turn the world’s life story into serious business.
