Google's OpenSocial may bring sun down on Facebook: analyst

By Stan Beer
Friday, 02 November 2007 10:08

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Facebook may be the hottest thing since chilli peppers right now but, according to a senior analyst, Facebook's uniqueness is drawing to a close thanks to Google's Open Social, a new open standards based API platform for developing third party applications for social networking sites.

The ability to place third party applications on a large website is good for both the users (it adds more functionality to the website) and for the website owner (more visitors means more advertising revenue) and Facebook is an acknowledged pioneer in this regard. However, according to David Bradshaw, prinncipal analyst at Ovum, the problem for Facebook is that its third party development platform is proprietary, while OpenSocial is, as its name suggests, open.

“Facebook requires webapp builders to adhere to its proprietary APIs," says Bradshaw.

"In contrast, OpenSocial is built using open standards like HTML and Javascript, and it also supports Adobe's Flash. As a result, widgets on Facebook will be a lot harder to deploy on other sites and vice-versa, while OpenSocial widgets should be relatively easy to deploy between sites."

So the differentiator between FaceBook and OpenSocial is clear and presents a clear threat to the fastest growing social networking site on the market, says Bradshaw.

"OpenSocial's appeal is straightforward: build for one OpenSocial compliant website and you can deploy in lots of other places too. It is a clear challenge to Facebook's appeal: build on me and get a chance to grab some of my high volume of traffic.

“But is OpenSocial likely to work? We think it has a very good chance. Facebook may be one of the hottest properties on the web, but it is by no means the only popular social networking website, nor is its continued 'hot' status guaranteed. Indeed, widescale adoption of OpenSocial APIs by website owners and webapp developers will reduce Facebook's uniqueness to end users."

As for Microsoft beating Google to the punch in getting a stake in Facebook, Bradshaw believes that Google was probably never interested in competing for a share of the site.

"The timing has got the conspiracy theorists going, with the announcement coming so soon after Microsoft forged its alliance with, and took a minority stake in Facebook. Could this be a direct retaliation? 
“We think the converse - because Google had this rolling down the launch ramp, it was perhaps not as keen as Microsoft for an alliance with Facebook.

"We are especially interested by the participation of salesfore.com and Oracle in OpenSocial. Clearly their interest is being piqued by the increasing cross-over between the consumer web and the business web. This is a growing trend, especially in business applications like CRM that have an affinity to social networking."