Facebook cements No. 1 status
Friday, December 31, 2010
This may go down as the year that social networking trumped searching as America's favorite online pastime.
In 2010, Facebook pushed past Google to become the most popular site on the Internet for the first time, according to two Web tracking firms. The title caps a year of rapid ascent for Facebook in which the social network hit 500 million users and founder Mark Zuckerberg was named Time magazine's Person of the Year. It also marks another milestone in the ongoing shift in the way Americans spend their time online, a social change that profoundly alters how people get news and interact with one another - and even the definition of the word "friend."
Since its inception, the service has evolved beyond a vehicle for sharing birthday photos and reconnecting with high school classmates to become a universe unto itself, one where users can watch videos, solicit restaurant recommendations and play games surrounded (at least virtually) by friends and family. Its rise suggests that the influence of search giants such as Google, which answer search queries with a complicated algorithm for ranking links, is giving way to something more personal: our network of friends and other connections.
"This is the most transformational shift in the history of the Internet," said Lou Kerner, a social-media analyst with Wedbush Securities and former chief executive of Bolt.com, an early networking site. "We're moving from a Google-centric Web to a people-centric Web."
According to Experian Hitwise, Facebook jumped to the top spot after spending last year in third place and the year before ranked ninth. The company found that 8.9 percent of unique online visits were to Facebook this year, compared with Google's 7.2 percent. Meanwhile, ComScore, another firm that calculates Web traffic, said Facebook is on track in 2010 to surpass Google for the first time in number of pages viewed. Each unique visit to a site can result in multiple page views. (Washington Post Co. Chairman Donald E. Graham is a member of Facebook's board of directors.)
"There is a strong point of view held by a lot of people that Facebook communication is more superficial," said David Kirkpatrick, author of "The Facebook Effect." "It's certainly more cursory, but that doesn't make it less significant or meaningful. It's just easier, and that's why it's so popular."
A survey this summer by the Nielsen Co. found that Americans spent nearly 23 percent of their time online using social networks, up from about 16 percent in a 2009 poll. Social networking took up more time than any other activity, including e-mail, which experienced a decline. Searching took up just less than 4 percent of time online, according to the survey.
A good part of the disparity can be explained by the different functions of the sites, which can make them difficult to compare. Consumers use Google to get to other places, but they log on to Facebook to stay. That helped Facebook account for roughly a quarter of online page views in November, significantly outpacing Google, Hitwise said.
But there is one key area in which Facebook has yet to surpass Google: revenue. The search giant recorded nearly $24 billion in sales this year. Several news reports put Facebook's revenue at $800 million in 2009, and the company is expected to bring in about a billion dollars this year - though how profitable Facebook is remains in question.
Chief executive Mark Zuckerberg has said he plans to take the company public, and the timing is the subject of hot debate among investors. According to SharesPost, an exchange for shares of private companies, Facebook is worth more than $45 billion. Google's market value is more than four times that amount.
With growth comes greater scrutiny, both by regulators and consumers. Facebook has been accused of allowing advertisers excessive access to users' personal information, prompting some to leave the social network. This month, South Korean officials said the company did an "inadequate" job of notifying users when their data was given to a third party. They asked Facebook to review its policies.
Google remains a powerful dashboard for the Internet, said Lee Rainie, director of the Pew Research Center's Internet & American Life Project. But now that two-thirds of online adults are creating and sharing their own content, new navigational tools are needed.
Facebook's "ascendance highlights the degree to which the online environment has become participatory and social," Rainie said.
Yet despite its rapid growth, social networking remains heavily dependent on search. The Hitwise analysis found that the most frequently searched term this year was "facebook."
The second most-searched term? "Facebook login."
"They continue to sort of work together as well as compete," said Heather Dougherty, director of research at Hitwise. "They're kind of a funny 'frenemy.' "