“Facebook was scared shitless and knew that for first time in its life it arguably had a competitor that could not only eat its lunch, but also destroy its future prospects. Why? Because Facebook is essentially about photos, and Instagram had found and attacked Facebook’s achilles heel — mobile photo sharing.”
Paul Higgins: Interesting. Thanks for the reblog and note dwellman. Always had the view that it is impossible for one organisation to dominate the web in the way that Facebook is trying to do. There is so much innovation and movement in the space that competitors will keep popping up despite the numbers and head start. A lot easier to create something in the social media space like that than to build smartphone and tablet hardware and the ecosystem it needs to go with it.
Dwellman: I would actually say that Facebook real threat isn’t instagram. Instagram undermines the social feed. So does tumblr and twitter. But there is one that undermines the heart of Facebook, their business model - and that is pinterest.
Talk to websites who look to advertise on Facebook and they are already splitting their Facebook ad budgets with pinterest. Many sites see more traffic from pintrist than Facebook and the games is just starting.
I doubt that Facebook was necessarily scared by Instagram. Facebook is certainly about pictures and Instagram simply had a better mousetrap for mobile photo sharing. While the two will be separate initially, over time look for Instagram to be completely integrated into the Facebook Borg and the name Instagram getting kicked to the dustbin of Internet startup history.
Facebook however has their sites set on an even bigger and more audacious goal, building the next great commerce platform. Their F-commerce strategy does not get the attention that other things do at Facebook, but make no mistake that Facebook is closely watching Pinterest. If anything P-commerce is well ahead of F-commerce and completely disrupts Facebook’s strategy of enclosing commerce in their walled garden.