> What matters is the fact that they can associate web browsing actions (pages visited etc) with your Facebook account.
And what will kill them is the increasing regulatory pressure (GDPR especially) that will end this soon, for a significant percentage of their most valuable users.
Once GDPR lands Facebook will need every user to explicitly opt-in to tracking their non-FB browsing actions, plus separate opt-in for tracking various elements of their Facebook data itself, and will face very tight constraints of how this can be shared with advertisers even once they have that consent. Sharing WhatsApp/Instagram's data with Facebook would be another separate opt-in there, etc etc. Access to these sites cannot be contingent on you agreeing to give them your data (that's not considered legitimate consent). Effectively the EU is going to forcibly stop them tracking EU users, or using any of their data for advertising, for anybody doesn't explicitly ask them to.
This is going to hurt. They're going to have to persuade every EU Facebook user that they _want_ to have their data tracked for advertising. Right now I can't see them making a convincing case for any significant percentage of their EU user base (though I'm sure they've put a lot of thought into this, so there may well be developments here in the coming months).
The EU is nearly 20% of Facebook's user base (~50% larger than the US), and as a relatively affluent part of the world, it's a particularly valuable segment for advertisers. Before the end of this year they're going to lose their unique advertising advantage for a very large proportion of that group, and I'd expect over the next decade other countries and regions to follow suit.
The model of advertising on the Internet is going to change pretty drastically over the next few years, and Facebook's success fundamentally depends on the current model. The 'crucial moat' you point out is about to disappear overnight, and they're not in a good place to deal with it.
And what will kill them is the increasing regulatory pressure (GDPR especially) that will end this soon, for a significant percentage of their most valuable users.
Once GDPR lands Facebook will need every user to explicitly opt-in to tracking their non-FB browsing actions, plus separate opt-in for tracking various elements of their Facebook data itself, and will face very tight constraints of how this can be shared with advertisers even once they have that consent. Sharing WhatsApp/Instagram's data with Facebook would be another separate opt-in there, etc etc. Access to these sites cannot be contingent on you agreeing to give them your data (that's not considered legitimate consent). Effectively the EU is going to forcibly stop them tracking EU users, or using any of their data for advertising, for anybody doesn't explicitly ask them to.
This is going to hurt. They're going to have to persuade every EU Facebook user that they _want_ to have their data tracked for advertising. Right now I can't see them making a convincing case for any significant percentage of their EU user base (though I'm sure they've put a lot of thought into this, so there may well be developments here in the coming months).
The EU is nearly 20% of Facebook's user base (~50% larger than the US), and as a relatively affluent part of the world, it's a particularly valuable segment for advertisers. Before the end of this year they're going to lose their unique advertising advantage for a very large proportion of that group, and I'd expect over the next decade other countries and regions to follow suit.
The model of advertising on the Internet is going to change pretty drastically over the next few years, and Facebook's success fundamentally depends on the current model. The 'crucial moat' you point out is about to disappear overnight, and they're not in a good place to deal with it.