Everyone is wrong about this Facebook thing. How’s that for a lede in a newsletter that hasn’t published in literally years!

Let’s get on with it then.

Zuckerberg’s third act

Facebook 3.0 is a convenient and easily parsed headline, though I prefer to think of this as Zuckerberg’s third act. The man and his monster are inseparable, for one, with Zuckerberg’s control over Facebook virtually unprecedented. But there’s also something rather personal and tragic, in a Shakespearean sort of way, about the vagaries and vacillations of this boyish king and his empire of billions.

The most immediate retort to Zuckerberg’s vague and blithe post was one of disbelief, specifically there’s no reason to believe someone who’s built a sprawling, multi-billion dollar empire largely on deceit and indifference. We’ve heard similar promises before, plenty of Facebook’s critics tweeted, why would we believe you now?

All of this incredulity is certainly warranted and has been very much earned by Zuckerberg’s shameless shifting of norms and expectations around privacy and online community. Even when Facebook follows through, it rarely turns out to be better for anyone but, well, Facebook.

I couldn’t help but be reminded, however, of one of the immediate reactions to the 2016 election. As we all collectively grappled with “what the fuck just happened”, a rubric emerged about taking Trump literally vs. seriously. It’s one I’ve found actually quite helpful in parsing Zuckerberg as well.

(Gratuitous aside: is there anyone more appropriate as an avatar of this moment in capitalism in these dire, Trumpian times than Mark Zuckerberg? Trump and Zuckerberg make for such a fitting pair as we cast about, trying to make some kind of sense of this particular hellscape. Obviously, their personalities could not be more different: Trump is all bombast and bluster, Zuckerberg cold robotic analysis; Trump exudes the slimy charisma of a well-honed grifter, whereas Zuckerberg seems content to ponder human-ness as some sort of philosophical exercise, preferably from as far as possible. These days, though, the two seem less like foils than complements, with neither side having a moral core to draw from.)

I’m going to say I take Zuckerberg both seriously and literally. I believe him when he says he’s going to unify the messaging backends of his three flagship products. I take it at face value that private communications will now be encrypted, that they won’t build data centers in certain countries, and that even public posts will no longer be permanent by default. I take him seriously because I don’t believe any of this is some great pivot but a fairly routine, natural evolution for the company.

The pivot that isn’t

Of all the newspeak that has has been belched out of Silicon Valley, “pivot” is far from the worst. For one, it’s actually a fairly accurate recasting of an existing concept to describe a somewhat routine event in the lifecycle of most early stage startups: the thing you were working on isn’t quite right, you haven’t found that vaunted product-market fit yet, so shift focus while there’s still a little money to burn in the hopes that you can salvage some of what you’ve built.

Zuckerberg did not announce a pivot. Pivots make sense when the company is young and small, when almost everyone is enough of a generalist that they can truly do something completely different both competently and happily. When there’s no legacy infrastructure and, just as importantly, very few legacy users who will throw a conniption.

Pivots are not executed by massive global corporations with tens of billions of dollars in annual revenue and a workforce numbering in the tens of thousands. If Facebook were pivoting away from their core business — a business that generates over $50 billion annually and is still growing at about 30% YoY — it would be a massive restructure, probably involving thousands of layoffs. That’s not happening because this isn’t a pivot.

Here’s a not terribly ambitious $1 bet I’ll make right now: in ten years, the Facebook Newsfeed will still exist, will be largely the same as it is today, and will still drive a significant amount of revenue (I’m not familiar enough with Facebook’s earnings to get specific, so feel free to propose this bet!). This is perhaps obvious, but Zuckerberg’s memo didn’t include any actual changes to the core of how Newsfeed works. Encrypting your private chats won’t change any of the signals that drive the Newsfeed algorithm. Setting a new default on how long posts are shared won’t affect the Newsfeed since those algorithms are driven primarily by what’s happening right now, not what you were listening to ten years ago in high school.

The only thing that makes me think my dollar might be at risk is the news that Chris Cox is leaving, but even that feels more like a personal decision that had been waiting in the wings than a directional shift.

This isn’t a pivot, it’s an expansion of Facebook’s lines of business and it’s frankly one we should’ve seen coming.

WeFaceChatBook

Facebook made over fifty billion dollars last year, mostly by selling highly targeted ads that run alongside their user’s updates. This was a nearly 40% growth over the previous year, which is astounding, but actually a slow down in the growth trajectory (these numbers all came from Wikipedia, no way I’m reading one of those earnings reports).

Facebook is a phenomenal business but one that is running into the inevitable inertia of markets. And while it could literally stop building any new features and continue to generate revenue that would be envious of nearly any corporation in history, one of the Laws of Business is that it must keep growing. You can disagree with this law, you can point out that it creates unrealistic expectations that are responsible for nearly everything wrong with what we think of as global capitalism today, but it’s a law for a reason. Grow — preferably every quarter and beating analysts expectations! — or die.

Facebook’s connected every human who wants what they offers, and even plenty who don’t. They will eventually connect the lingering few billion holdouts, but it won’t be easy. They’ve moved from the gushers of users just waiting to be barreled and refined, to having to hydraulically frack humanity. It won’t be cheap but, by god, they’ll get there. This won’t bring in the exponential growth they’re used to, that the market demands, and mere linear growth is a problem.

Facebook needs to expand and quickly and the best way to do that is to return to the playbook that’s worked out so well for them before: steal someone else’s product, refine it with an army of programmers and designers, then point a few billion people at it. For the next phase of Facebook, this means building WeChat for the rest of the world.

I’ve haven’t used WeChat much (or Facebook, for that matter!), so my understanding is at best academic. What I do know is it’s how everyone in China buys things, hails cabs, gets their news, plays games, and, yeah, chats. Ben Thompson very helpfully explained it as a layer that exists on top of the mobile platforms iOS and Android. It’s Facebook and Twitter and Uber and Amazon and Google and YouTube and Google Maps and Tinder and Snapchat and Stripe and Venmo and probably a whole bunch of other things all in one and it’s used by a billion people, almost all of them located in China.

Squint a little and think about a Facebook where all of the messaging platforms are united and encrypted, where you purchase something on Instagram and get shipping updates on WhatsApp, where you pay your friends back for dinner via FB Crypto Coins, where you order takeout through Messenger. Where the tens of millions of businesses already on Facebook are suddenly selling to you directly instead of just targeting you via surveillance capitalism. Kinda sounds like WeChat? It certainly sounds like a way to get value — a lot more value! — out of Facebook’s existing users without having to add another billion people to the network year over year.

(It also sounds like now would be a GREAT time for the new “services” oriented Apple to release Messages for Android, huh?)

So if this isn’t a pivot but an expansion of the job that Facebook does in people’s lives — and probably one that’s been in the works for a while — what’s the point of all this? It’s just a standard PR exercise that’s masquerading as some attempt at social awareness, a repackaging of a product launch as a shift in some grand mission.

Audiences

This is maybe obvious, but let me just state for the record I despise reading these posts from Zuckerberg — and I’ve read, best I can tell, all of them. More than the sophomoric style, the complete lack of self awareness, the refusal to hold himself accountable, the sloppy psuedo-philosophizing — it’s the feeling that I have to read these things to understand the world in which we now live. I don’t read press releases from, I dunno, oil companies or even most other tech or media companies. But Facebook is this gravity well of attention seeking, the only product I haven’t used regularly in over a decade that I feel a need to care about.

When my eyes start to glaze over at about the fifth vulgar misuse of the word “community”, I start to think about these things at a kind of meta level. For this one, I couldn’t help but wonder about the audience Zuckerberg had in mind when he wrote this. There are some obvious ones — it’s PR and marketing for the general public, sure, as well as a not-so-subtle shot at regulators thinking about cleaving Facebook.

Another audience stuck out, though — Facebook’s investors and, especially, their employees. Until the 2016 election, Facebook’s critics could be largely dismissed as jealous haters who just didn’t understand all the great things all this open-and-connectedness was bringing. This was especially true amongst Facebook’s notoriously close knit and like minded employees. Internal dissent didn’t even need to be dismissed because just about everyone believed in the mission. Leakers and whistleblowers were famously hard to come by.

But now the idea that Facebook is actually a neutron bomb destroying democratic institutions isn’t just something cranky bloggers drone on about, it’s actually been proven out! And who wants to work on the product that Donald Trump’s media advisor literally said made it possible for him to win? Certainly not (most) of performatively liberal Silicon Valley, that’s for sure. The last two years have been rough on Facebook’s workers, more are talking to Mike Isaac, some are outright leaving.

This is a huge cultural liability for what is, at least superficially, a pretty great place to work — better than average pay to justify those Bay Area rents, a stock price that continues to go up, three meals a day, the highly amenitized lifestyle that Bay Area tech workers have come to expect. And while it’s true that Facebook was just as terrible for the world on November 8, 2016 as it was on November 9, those facts are now self-evident and impossible to rationalize.

So Zuckerberg’s latest manifesto is there to provide some cover for any of his employees who are suddenly fretting over how they choose to spend their labor. At the very least, it will offer a few years reprieve until Facebook manages to once again shift the overton window on what we consider acceptable. It is, after all, the thing Zuckerberg is best at.