Facebook’s big announcement: What it could be

January 15, 2013

Facebook say it’s planning something big at its main headquarters Tuesday but has provided few hints as to what it has to say.

The company sent out invitations to members of the press last week, inviting them to come and see what the social network is “building.” but while there are plenty of theories about what Facebook may have on tap, it’s still anyone’s guess.

The word “building” in the invitation implies a product announcement of some kind. So let’s go through the theories.

■ Starting off, there’s a small but dogged group of Facebook fans who think the company may be building a mobile phone, despite Facebook’s numerous statements that it’s not interested in such a device. As recently as last September, Facebook chief executive officer Mark Zuckerberg said that a phone “doesn’t make any sense” for the company. Needless to say, it would be quite the turnaround if we see a smartphone come out of Menlo Park Tuesday.

■Some literal-minded folks predict that Facebook may be hosting the event to show off its new campus, which could be a good PR move for the company to tout itself as helping the local community and creating jobs. But would Facebook send an invitation to the national press to visit its new digs. The company would have a lot of disappointed journalists on its hands if that’s the case.

■From here, the theories get a little more interesting. Maybe the company is moving deeper into search, to leverage the social data it has collected to compete with Google. A report from the New York Times noted that Facebook could make a very lucrative feature by letting users easily search what movies or songs a users’ friends are discussing in their updates. Right now, Facebook data is largely indexed in ways that make it difficult for average users to mine more thoroughly.

■ Another likely possibility is that the company is pulling back the curtain on a new advertising platform. It’s no secret that Facebook has been looking for new sources of revenue and advertising formats — from enabling users to buy gifts through the site to letting them pay to promote their own posts. But Facebook’s biggest problem in generating revenue has been finding a way to make money off of mobile advertising, as its audience shifts more and more to smartphones and tablets.

The company said last month that it was pausing its tests on mobile ads after receiving “positive” feedback from its advertising partners.

If Facebook can make — or, dare we say, build? — a strong mobile ad platform, it would be welcome news for investors worried about the site’s sustainability. Facebook stock opened Tuesday at $30.64, still enjoying the boost it got from the company’s invitation last week. Excitement over the announcement pushed shares above $30 for the first time since the company’s public offering in July.

(The Washington Post Company’s chief executive and chairman Don Graham is a member of Facebook’s board of directors.)

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Hayley Tsukayama covers consumer technology for The Washington Post.
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