Home Facebook, The Mighty Pipe, Could Crush Yahoo

Facebook, The Mighty Pipe, Could Crush Yahoo

Today Facebook is going to formally announce its plans to become an open platform. We know that the platform will allow companies to offer their products and services to Facebook users, but the details haven’t yet been ‘exposed’. So all of us bloggers are waiting for the news to be announced today, on the edges of our seats. In the meantime, I wanted to remind you of Alex Iskold’s article this week about Facebook – which I thought was intriguing. Alex posited that Facebook is ultimately aiming for an IPO, which would make it the first big Web company to go the IPO route for a long time. Web 2.0 has turned out to be more about M&A (mergers and acquisitions) than IPO (Initial Public Offering), but of course IPOs were all the rage in the Dot Com era.

Alex wrote that Facebook needs to find a way to earn money from widgets on their site. What’s intriguing here is that Facebook could eventually eat Yahoo’s lunch with such an open platform strategy. As Alex put it:

“If Facebook could figure out how to do this [earn money from widgets] in a way that makes the retailers happy and keeps the users from screaming, then this is a huge win for them. Consider a scenario where Amazon rolls out something as simple as books and Facebook gets a cut of each transaction. That could happen in many verticals, from books and movies to electronics and travel. And as Facebook is growing beyond the college population, and as its current college population graduates, there seems to be potential for a big upset brewing here – in the sense that Facebook could significantly eat into Yahoo’s business.”

While we’re waiting for the Facebook news to be announced, what are your thoughts on where Facebook is headed with their platform?

Update: the news is out now, see Techcrunch coverage. R/WW will provide our analysis later today, once the dust settles.

About ReadWrite’s Editorial Process

The ReadWrite Editorial policy involves closely monitoring the tech industry for major developments, new product launches, AI breakthroughs, video game releases and other newsworthy events. Editors assign relevant stories to staff writers or freelance contributors with expertise in each particular topic area. Before publication, articles go through a rigorous round of editing for accuracy, clarity, and to ensure adherence to ReadWrite's style guidelines.

Get the biggest tech headlines of the day delivered to your inbox

    By signing up, you agree to our Terms and Privacy Policy. Unsubscribe anytime.

    Tech News

    Explore the latest in tech with our Tech News. We cut through the noise for concise, relevant updates, keeping you informed about the rapidly evolving tech landscape with curated content that separates signal from noise.

    In-Depth Tech Stories

    Explore tech impact in In-Depth Stories. Narrative data journalism offers comprehensive analyses, revealing stories behind data. Understand industry trends for a deeper perspective on tech's intricate relationships with society.

    Expert Reviews

    Empower decisions with Expert Reviews, merging industry expertise and insightful analysis. Delve into tech intricacies, get the best deals, and stay ahead with our trustworthy guide to navigating the ever-changing tech market.