TikTok was devouring Facebook from within

If in 2021, TikTok is a problem that Facebook can’t crack, then this year this problem has “upgraded”. Recently, Reuters commented that TikTok is comprehensively “devouring” Facebook from within: it not only sucked away Facebook’s young users but also began to challenge Facebook’s new media supremacy.

Reuters’ interpretation is not sensational. In the latest first-quarter earnings report, the performance of Facebook’s parent company Meta has mixed the market.

Happily, Facebook’s daily active users reached 1.96 billion in the same period, an increase of 4% year-on-year, which was better than investors expected.

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Worryingly, Meta’s revenue was $27.908 billion, up 7% year-on-year, but the growth rate fell to the lowest level in 10 years of listing.

After the news was announced, Meta’s after-hours stock price soared by 19%, but the media generally believed that this was just an oversold rally.

In the last earnings report, Facebook’s user growth stagnated for the first time, surprising everyone. CEO Zuckerberg blamed part of the blame on rival TikTok. Since then, Meta’s stock price has begun to decline all the way.

Compared with the high point of the current year, Meta’s current share price is close to the waist. As of the previous session, the company’s shares were down 48 percent from the start of the year and were well behind the broader market (down 12 percent).

On the other hand, TikTok, although unlisted cannot be measured by market capitalization, its development momentum and Meta are polarized.

From the perspective of hard indicators of active users, according to the data of the analysis company Data.ai. Data, in the first quarter of 2022, TikTok’s monthly active users have nearly 1.6 billion, although the absolute number is inferior to Facebook’s 2.9 billion, the increase reached 45%, still significantly crushing Facebook.

TikTok can give Facebook a headache, in part because of its quality content and the willingness of users to pay for it. According to Data.ai data, in the first quarter of 2022, consumer spending on TikTok ranked first among all major apps and games in the world.

TikTok, on the other hand, has also challenged Facebook’s position as a new media overlord. According to the Pew Research Center, meta’s social platforms, including Facebook and Instagram, were the daily news source for 31 percent of Americans last September, when TikTok accounted for just 6 percent. But a few days ago, TikTok has gradually become a channel for people to understand information.

In order to beat TikTok, Meta pinned its hopes on its own short video product Reels or another remake of TikTok.

On the earnings call, Zuckerberg said Reels will be one of Meta’s three main growth engines in the future. “In the first quarter of this year, the growth of short videos was very fast, users spent 20% of their time on Instagram using Reels, and the company will invest more energy in Reels.”

But Reels is still struggling to reverse the loss of Meta users. According to investment bank Cowen, about 37% of Facebook users are currently using TikTok, compared with 51% on Instagram.

Meta imitates TikTok, not to lift an opponent – but to fight back in real self-defense.

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