Thursday, January 17, 2013

Analysts Are Unimpressed With Facebook Graph Search

The link to the full story is here

Investors and consumers are still in the process of figuring out exactly what Facebook Graph Search means for the future of the social network, but right now, the first reaction from many analysts seems to be "meh."

Brian Wieser, a senior analyst at Pivotal Research Group, said in an investor note Tuesday that Facebook's new smarter search engine is a "favorable" development in that it shows the company is continuing to innovate, but he doubts about how much potential it has for monetization going forward.

"We are not assuming that the initiative will lead to meaningful revenue growth in the near future as several issues will limit Facebook's potential," Wieser wrote in the note. "Our initial view is that the quantity of Facebook search volumes will be relatively low, as consumers are likely to continue prioritizing other sources (i.e. Google). Advertisers would consequently only use search if they can - or are perceived to - satisfy their goals efficiently with Facebook."

Likewise, Gartner analyst Ray Valdez suggested that the data shared between friends could be a powerful tool for search, but noted that the average user probably doesn't have that much data to share. "Very well-connected individuals have a rich treasure trove of data that they can mine, but the average person's storehouse of data is much sparser and has less relevance to these queries," he told Reuters.

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