I just posted on TechCrunch. The article focuses on the Facebook S1 filing and in particular on the risks section that covers the growth of the mobile internet and its potential impact on the web business model.
Facebook itself has been very clear that its advertising revenues are exclusively derived from its web site, and also that an increasing amount of its usage comes from mobile in general and smart phones in particular.
Buried in the article is this point:
Google’s present – and Facebook’s future – involves the painful fact that the very success of mobile platforms in helping human beings be productive, on the go, has a negative impact on the desktop-based advertising programs of the past 10 years. Mobile growth impacts web advertising revenues, except of course for Apple who make money from hardware and software and so benefits from these trends. The reason is simple. We do less ad-centric activities on mobile than we did on the web. And we are less likely to click away on an ad when we are focused on a specific goal on a largely single window device.
The implication of this point is that, absent an advertising solution for mobile, Google’s success in distributing Android, as well as the rise of the iPhone, are directly damaging to Google’s legacy business model. Now, it isn’t as if anybody can turn the mobile internet off or slow its growth. So Google has no option but to be a significant player in mobile, and has no option but to try and drive the revenues it derives from mobile harder than the pace of slow down in web based revenues that result from the trend. But to accomplish that Google, and Facebook will need to innovate in advertising. Web based display ads, text ads and others are really not able to translate effectively to mobile without seriusly undermining the user experience.
This is one of the areas we are focused on at just.me.