Facebook is a massive social network; which has led to quite a bit of debate. The reality is that in the world of social media, legends can fall apart over night. However, I don't see that in Facebook's future. As a matter of fact, with the big moves they've made recently, I think we're going to see growth for the next several years. So, where are the profits going to come from?
Facebook's Past Acquisitions Will Drive Future Profits
One of the biggest factors that I think will drive upward momentum for Facebook is the strategic way they go about acquisitions. Recently, the company purchased two major players in their space. They include…
- WhatsApp – WhatsApp is a mobile messaging application that allows mobile phone users on iOS and Android devices to exchange messages without having to pay fees for SMS. In 2014, Facebook purchased WhatsApp for a total of $19 billion. While that may seem like a ton of money, the reality is that more consumers are doing everything on mobile phones these days than ever before. So, WhatsApp gives Facebook a major leg in the door when it comes to advertising through mobile messaging platforms and will surely drive revenue in the long run!
- Instagram – In 2012, Facebook purchased Instagram for a total of $1 billion in cash and company shares. Instagram is an online and mobile photo sharing service that has helped to drive revenue for Facebook since the acquisition and will continue to do so for years to come.
Although these acquisitions are nothing new, they are still incredibly important today. Facebook has taken these companies and grown them both to epic proportions. The company took WhatsApp, which had 600 million users and very little monetization and turned it into a revenue stream. Also, they've driven their user count and revenue indirectly through Instagram. All in all, these acquisitions have already helped to drive revenue and will continue to do so for years to come.
Further Advances In Messaging
Facebook's messenger is nothing new. As a matter of fact, I remember using it years ago. However, while focusing on ad revenue from the main portion of the social network, it seems like the company didn't put too much time into turning Messenger into a revenue stream. However, that has recently changed. Facebook recently announced that they are working to open new tools in messenger that will allow third party developers to create ways to display content through the system. As a result, more people will be focused on messenger; where they will see ads and help to boost the revenue of the company as a whole.
How Binary Options Traders Can Take Advantage Of The Data
While Facebook has a ton of good news going for them, their stock really doesn't show it at the moment. Although we have seen gains over the long term, price volatility in this stock in particular has made the growth course a rocky road. The good news however is that the strong price volatility on the way to the top opens great opportunities for traders. We know that in the long run, Facebook is going to grow. So, by watching for volatility dragging the price of the stock down, we can ride the trends back up, making profit all the way.