Facebook's dominance of the social networking landscape appears to be facing an existential threat from the rival TikTok app as social media users shift towards short-form video Meta formerly known as Facebook Inc has for the first time recorded a drop in its global daily users between the third and fourth quarters of 2021.
Commenting on TikTok which is amassed more than a billion users since it was launched in 2016 meta CEO Mark Zuckerberg reportedly said in the company's earnings call that Facebook was against an unprecedented level of competition Zuckerberg said that the company will be focusing on Reels its short-form video feature on Instagram that mimics TikTok. He also compared the situation to when Instagram introduced its Stories feature which was essentially a clone of Snapchat a record wipeout was witnessed in the stock market after Facebook's latest report showed a dip in quarterly user growth this was the first for the company since it was launched 16 years ago in 2006. Meta's share values subsequently decreased by more than 20 erasing around 237 billion dollars from the company's valuation including a 25 billion dollar drop in Facebook.
"Founder Mark Zuckerberg's value meadow is down because TikTok is literally eating its lunch right like there is no doubt in my mind mark Zuckerberg for the first time ever looked vulnerable last night."
Other factors contributing to Facebook's dismal performance include intensified regulatory and public scrutiny of the company and fewer people spending time online after Covid19 restrictions began easing around the world growth rates have stagnated as Facebook's daily user numbers have plateaued at around 2 billion people there's also been a 10 billion drop in revenue from targeted advertisements after Apple rolled out a new privacy feature which apparently benefited Facebook's other competitor google which earns ad revenue that is not dependent on privacy settings the renewed attention on video content also signals a shift from the platform's current focus on the Metaverse on which the company has already spent more than 30 Billion dollars.
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