Facebook sucks at innovation and its products fail a lot

In a few short weeks millions, okay thousands, of Facebook developers will descend on San Francisco to attend the social network’s famed developer conference — F8. The event has been on a three-year hiatus since Facebook went public, but it seems to have come back in full force with a jam-packed event for developers.

This year’s event is specifically geared at developers and Facebook says that it won’t have major user announcements at the event. The company wants to focus the event on four core areas for the developers: building cross-platform apps, growing the number of people using the apps, monetizing those apps and instilling the ethos of the hacker way.

As developers and journalists prepare for the event, Gartner’s research director Brian Blau, has some insights on what he thinks Facebook should focus on.

“We will see Facebook continue to launch new products and technologies, and as in the past we will see them stumble,” the Gartner director says. He reckons that Facebook seems to have an innovation problem.

It has had some failures with products and in general, Facebook seems to have a problem innovating, or that its innovations haven’t been paying off as it had hoped. But the foundations of Facebook’s advertising business are solid, and at some point we will probably see the company diversify even more, so it can better capitalise on its large user base and foundations in connecting people to each other and the brands they like.

Blau argues that there are three core areas that Facebook needs to demystify before it can get on with capitalising on its user-base and it advertising foundations.

F8 will be the centerpiece for Facebook

According to Blau, the event is particularly important to the social network as it will serve as “a centrepiece for Facebook as it expands its presence in the developer community”.

“In the past the F8 conference has seen major product announcements, so it could happen again this year, but it’s likely Facebook will focus on how developers can take advantage of the entire Facebook developer ecosystem as it expands how its social graph can reach more and do more,” he reckons.

Blau says that he will be looking for ways in which businesses can better connect with Facebook users. Essentially how the social network will expand its advertising platform, will it make inroads into ecommerce or payments? He adds that he’ll also be looking at what all its recent acquisitions mean.

Monetisation: expanding the ad platform

One of the core areas that Facebook wants to focus on with this year’s F8 is monetsation and how developers can make money through their Facebook apps.

“I believe that Facebook will look to expand its advertising offering into other areas, such as offsite ads, offline ads, or even have a deeper penetration into media tie-ups or to move deeper into video ads,” Blau says.

“While Facebook does not have the extensive reach compared to Google, it is very competitive for ad spending as it has a unique platform with very engaged users. Also, Twitter just announced app advertising, something that Facebook has excelled at this past year, so we may see enhancements there as well.”

Privacy and reputation building

Facebook has suffered from knocks to its reputation due to rapid changes to its privacy settings and users being worried about Facebook content being kept private.

According to Blau, Facebook will need to work hard creating product that will keep its users engaged but also private.

“There have been lingering questions about how people react to the many privacy settings changes we have seen from Facebook over the years.”

Though this has led to some decline in user numbers, Blau concedes that not everyone is leaving, they have just begun to curtail their activity.

“Facebook’s recent announcement of Nearby Friends is an example of how the company can add new and engaging features but keep them private, in this case the new feature is an opt-in only.”