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Prediction: Facebook Will Enter the Search Market Next Year

BenWalker

Top Contributor
Interesting article on TechCrunch....thought I'd share...
http://techcrunch.com/2011/08/26/prediction-facebook-will-enter-the-search-market-next-year/

Ben Elowitz (@elowitz) is co-founder and CEO of media company Wetpaint, and author of the Digital Quarters blog about the future of digital media. Prior to Wetpaint, Elowitz co-founded Blue Nile (NILE). He is an angel investor in media and e-commerce companies.

Next year, search advertising will be a $15 billion market in the U.S. alone, growing by 14 percent, according to eMarketer. And, if Facebook can capture half the share of that market that Google has today, it could easily add an extra $25 billion or even far more to its value.

For most any CEO who could have even a modest chance of succeeding at it, that payoff would be reason enough to take a serious look at entering the search category. And yet, while I’m sure he wouldn’t scoff at the extra revenues, profits, or valuation, I suspect that Mark Zuckerberg finds something else far more motivating than just increasing the financial value of his company.

And that’s what will propel him next year to make a completely disruptive entry into the search category.

So if it’s not for the financial value, then why am I so certain that Mark Z. will make a play for Google’s home turf?

It’s because it’s so irresistibly good for his users. And that’s the most important principle that seems to guide his product development.

The Five Reasons For Facebook To Enter Search

With that in mind, here are the five specific reasons why Facebook should enter search next year:

1) To make Facebook the ultimate home page. Consumers make Facebook their home base. Half log in every day; and users come to Facebook 70 percent more times per day than even to Google. They stay twice as long as even users of Yahoo’s vast network of email, content, and more. Facebook has become the Connected Web’s de facto operating system. But right now, its “start button” is limited to what other people put in your newsfeed. Part of being home base is being a launching pad to go anywhere you want. So Zuckerberg will need to give users a great connection to the rest of the Web – whatever their intent.

2) To fix a broken feature. Facebook has a search feature today (powered by Bing); and a few people already use it for Web-wide search, even though it isn’t very good. It needs significant upgrading, and Zuckerberg knows it. Having a feature this important be this incomplete creates an unacceptable user experience. It must be fixed.

3) To improve people’s life online. Facebook has an enormous data set that it can use to deliver better search results than anyone on the planet. Facebook can see everything that Google can see in terms of pages and links, but with a whole extra dimension of human connection that is impenetrable to Google. Facebook knows what your friends like, and what people like you like. And it knows the difference between real interest and spam. Translating that knowledge into great results will improve online life for his users.

4) To fully connect the world. More than anything, Zuckerberg and his company’s DNA are all about providing services to connect users to each other and, increasingly, to the world at large. Serendipity and sharing aren’t enough: sometimes people know what they want to find. Facebook must have a search feature to fully enable connection.

5) To add to his immense data set. Search will not only help users; its users will help Facebook. Specifically, it will provide Facebook with even more data about what people want so Facebook can further personalize itself for everyone. Go ahead and cue the creepy privacy music, but remember that so far most users have been happy to make a privacy tradeoff to get valuable personalized service.

With Facebook Connect, Open Graph, and Like buttons, Facebook has already shown its vision to fully connect to the rest of the Web. The next step is to help people better access it.

Facebook: The Social Operating System For Connected Lives

Facebook began as a social application, but it’s now in the process of becoming a Social Operating System for the Web at large. Offering world-class search is the next step in its evolution as that “Social OS.” The Web is now organized around connected people, not documents – and Facebook is the OS that links those people together.

Once fully connected, can you imagine how Zuckerberg must think about a Web all wired-in through Facebook’s central hub? He’d know the time spent on every page; the usefulness of every link; the patterns of every user. He’d have a real-time system that provides feedback on every recommendation. You know what’s cooler than a billion connections on the Web? How about a quadrillion!

The value of that data will be immense in making recommendations to users, serving advertisers, refining search itself, and enabling next-generation social applications. It will give Facebook a competitive advantage over every other Internet company in building a map of where the gold is buried – in the form of the content each individual user wants – among the trillions of pages on the Web. But more importantly, it will allow Zuckerberg to serve his users.

“Social Search” Is More Than Just Links From Your Friends

The idea of a socially-powered search is not brand new for Facebook. Bing and Blekko have both incorporated features that bring your friends’ Facebook content into the search results. And while that is one modest way to improve the search, its impact pales in comparison to the full potential of what Facebook can do to help you by fully exploiting its social data set: It can individualize search results just for you, by using not only data about you and your friends, but by using the full dataset of people you haven’t even met yet.

Let’s look at it competitively. Google and Bing have, with limited exceptions, held themselves to the standard that the results should be the same for everyone because they work in an anonymous environment. A friend from Microsoft tells me that Bing has a rule that, with the exception of bucket tests, the top ranked result must be the same for everyone. This rule, he says, was copied from Google – where it fits well with Google’s increasing positioning of itself as the great defender of identity control, compared to Facebook’s ethos where everything is public. But that differentiation hands Facebook an incredible opportunity: in the Facebook environment, it’s not only accepted but expected that everything you do is customized for you alone.

Can you imagine the power of combining Amazon-like personalization with Facebook’s deep dataset to offer better results?

Facebook Can Redefine Search in a Social World

That’s why beyond just improving a search algorithm, Facebook’s greater opportunity is in redefining the category. The last decade of Web use has been defined by Google’s clean white splash page with a single query field, and the 10 blue links which follow. But just as that approach from Google displaced the prior generation’s directory pages, it’s time for a breakthrough experience. And Facebook is the natural player to provide it.

I’m sure the engineers at Facebook are already visualizing what search could be in a fully connected world. Searches could be proactive, prompted by items shared by friends, rather than awaiting a text field completion. Searches can favor brands and publications that you like, or your friends like. But most importantly, searches can be predicted based on people like you, people who are located where you are, or people with similar interests, profiles, and behaviors, without you ever even knowing them. All of these are ways that Facebook can fundamentally redefine search, thanks to its knowledge of each user’s identity, interests, and behaviors.

How It Could Happen in 2012

But building a search engine that takes (a difference-making) advantage of the social graph takes lots of time and money, as does building a new operational infrastructure, Web crawler, and advertising engine to support it. And, even more significantly, this is one where Zuckerberg will need to get the privacy implications right from the start. Facebook is currently building its rep with major advertisers on its social network – and that’s a great start, because that will provide a captive customer base to transition into its search engine right at launch.

A competitive search engine is one of the most ambitious projects you can imagine – the degree of difficulty is mind-boggling, and the cost is hundreds of millions or more. For Facebook to best Google, it would need to catch up in substantial ways before it could shoot ahead of the leader, even with its valuable dataset. But that’s only an impossible challenge if it has to do it all alone.

And Facebook doesn’t have to.

It already has an alliance with the #2 player in search, Microsoft. And – in the way of “the enemy of my enemy is my friend” – it has a common interest in outperforming Google. And Facebook and Microsoft have enough separation between their businesses that they could complement each other rather than compete. Indeed, Facebook’s increasing strength in its advertising engine could be a huge lift to Bing’s struggling monetization – offering hope of raising Bing’s monetization toward Google’s levels. The two truly are more valuable together, and it’s no surprise that smart people have begun to speculate on a Bing-Facebook combination, a step beyond a partnership. Working with Bing for its search entry could save Facebook billions of dollars of initial R&D and speed its entry into the category by years – and by many dozens of engineers. And any agreement they’d sign would likely still give Facebook the option to create its own search engine down the road.

The Chilling Threat To Facebook’s Enemy

Regardless of how Facebook structures its efforts – and with whatever degree of help it gets from Microsoft – it will be able to create a search capability that will be significantly different from anything we’ve ever seen. And it will shake the tectonic plates underneath Google’s Mountain View headquarters, even as it vies to earn users’ adoption with better, more personalized results.

Google will not perish in the digital earthquake without a fight, though. Its recent Google+ launch, for example, shows just how boldly Google intends to enter Facebook’s home territory. That, of course, makes it even more imperative for Facebook to counter-invade by pushing into search.

Looking forward, it’s clear that search and social won’t always occupy separate spaces. Indeed, for consumers, over time, they will converge; and the blended (or, just as likely, reimagined) product that emerges will serve as a home base that will serve as a jumping-off point to everything that’s important and relevant on the 21st century Web.

It’s fascinating, and it’s all about to unfold. In the meantime, while Zuckerberg quietly forges ahead, and readies Facebook’s game-changing search entry, Eric Schmidt, Google’s former CEO, is publicly lamenting lost opportunities to catch Facebook. The diverging fortunes of these two digitally defining companies could not be more apparent right now.
 

James

Top Contributor
Facebook search is an interesting area, to be honest I do not think they will go to far into it.

Because their current set up is people first then products second.

Why would they want to compete with other companies who do a great job?

But yes I do a agree in a sense that more emphasis will be places on Search within Facebook.
 

LogoNerds

Member
It's only a matter of time. With Google rolling out google plus, there is a war coming, and it is only going to benefit all of us in the end.
 

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