Facebook is preparing for a change in its advertising activity

Menlo Park (APA / dpa) – Facebook's advertising activity is facing a change that will hold back the online network's money machine, which has been running at full speed for years. Members have further shared their contributions in the smaller circle of friends instead of Newsfeed, which was previously the heart of Facebook 's use, as Tuesday' s founder and boss Mark Zuckerberg said.

That's why Facebook has to rebuild its business. The news feed offers a lot of space for ads – and the online network generates billions of profits. For advertising in new formats, Facebook is only in the beginning and still needs, among other things, in the advertising prices last. "It's a journey that will take years and not quarters," said CFO Dave Wehner.

New formats include, for example, "stories" in which users typically post their photos and videos for a day for selected friends. "In the not too distant future, people will share more stories than flows," Zuckerberg predicted.

Facebook has already undergone a similar change when users switched from their PC to a smartphone. At that time, the online network initially had no business model for the mobile phone and investors doubted the future prospects of the company. But Newsfeed commercials as a solution to the problem turned out to be a gold mine. Zuckerberg and general manager, Sheryl Sandberg, have now recalled it to rebadure worried investors. It worked very well: the share, which lost almost 4% after Zuckerberg's warnings, regained an advantage of more than 3%.

The figures for the past quarter have already revealed problems. For example, the online network has lost a million users in Europe for the second consecutive quarter and still has 375 million active members at least once a month. Facebook had already warned that the provisions of the general regulation on data protection, in force since the end of May, would make business more difficult in Europe.

Worldwide, the growth of the online network continues. The number of active monthly users on Facebook rose from 2.23 billion to 2.27 billion in the space of two months. And advertising revenue has also increased significantly: quarterly revenue has grown about one-third over one year to $ 13.7 billion. Earnings climbed 9% to just under $ 1.34 billion.

Looking more closely at Facebook figures, growth is coming mainly from regions that are currently less lucrative for the online network. In the United States and Canada, Facebook now has 242 million active users a month, one million more than three months ago. However, it is by far the most lucrative market for the online network, where Facebook generated $ 27.61 of revenue per user in the last quarter. In Europe, the cost is US $ 8.82 per user and US $ 6.09 on average worldwide.

At the same time, spending is expected to increase by more than 50 percent this year and by 40 to 50 percent by 2019. This is particularly necessary for security and the fight against hatred and hatred, said Zuckerberg. Among other things, Facebook hires more employees for its extinguishing centers, deletes forbidden content. The number of employees has increased by 45% in one year, reaching just over 33,600. However, he loses the balance of costs and products out of sight, Zuckerberg badured badysts.

Zuckerberg, who otherwise rarely mentions competitors, acknowledged that Facebook was lying behind the video on Google's YouTube platform. However, until now, the online network has deliberately reduced the time that users can spend watching videos. Facebook is in a dilemma: "People want to watch videos," said Zuckerberg. At the same time, they expected Facebook but also social contacts with their friends and family. That's why Facebook has slowed the spread of so-called "viral" entertainment videos.

The Cambridge Analytica data scandal plunged Facebook into a crisis this year. Recently, a hacker attack that affected about 30 million users caused new negative headlines. However, this turbulence seems to have barely affected the activities of the online network so far.

~ ISIN US30303M1027 WEB https://www.facebook.com/ ~ APA007 2018-10-31 / 03: 38