Last week, Facebook announced changes in its News Feed algorithm, making sure that users will see more posts from their friends and family at the expense of posts from brands, media, and businesses. While the latest News Feed overhaul proves to be a good news for regular users, it can be a dead loss for Facebook. The Company was on a way to lose around $23Bn of its value after it declared its News Feed overhaul.
In accordance with reports, shares of Facebook fell more than 4% within hours after CEO Zuckerberg announced the alterations to make his blue platform more meaningful. This could even lead the Company on the track of the worst financial position in over last three months. And FB CEO Mark Zuckerberg could lose $3.3Bn of his own personal net worth. He posted on Facebook,
“One of our big focus areas for 2018 is making sure the time we all spend on Facebook is time well spent. We built Facebook to help people stay connected and bring us closer together with the people that matter to us.”
Zuckerberg further said that the social media network has got a feedback from the community that the public content (posts from publishers and brands) is messing up the special or personal moments.
The latest Facebook News Feed change sparked a concern regarding users will spend less time on the platform, resulting in the drop of its share stock. Zuckerberg acknowledged that the new modifications might not pay off at first. However, he believes that it’s important that people have now more meaningful social interactions. Given that the Company’s share stock has dropped from $8.29 to $179.47Bn after the News Feed overhaul, so FB could lose $23Bn that is more the total market value of its competitor Snapchat.
The News Feed overhaul follows criticism that Facebook’s algorithms may have prioritized fake news in users’ feed, influencing the 2016 American presidential election along with political discourse in other countries. The Silicon Valley-based entrepreneur said that its new ranking system would hurt non-advertising content from businesses such as news stories and viral video posts. On the other hand, the News Feed overhaul would not change the ranking of the paid advertising.
This will lead businesses that want the publicity of Facebook to spend more bucks on advertising. With its stock up 48% over the last year, the social media tycoon has a major driver of a technology rally that has pushed records high. In simple words, the News Feed overhaul may have an impact on leading suppliers of news and other content.
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