Brief:
- Facebook is taking aim at rival Pinterest with an app called Hobbi that lets people save and share photos of their personal interests like cooking and home improvement, The Information reported. A description page in Apple's App Store says that Hobbi "wants to help you document and remember the things you love to do," and lists the developer as Facebook's New Product Experimentation (NPE) Team.
- Hobbi was released in Colombia, Belgium, Spain and Ukraine, the Information reported. The limited release echoes Facebook's practice of testing new features in its pre-existing apps or standalone apps outside the U.S. The Hobbi trial doesn't mean that Facebook will necessarily release the app globally.
- Pinterest's stock fell yesterday after The Information broke the story about Hobbi. In response to the news, Pinterest issued a statement saying it remains focused on building "a visual discovery engine" while highlighting some of its differences from Hobbi, CNBC reported.
Insight:
It's too early to say what Facebook's Hobbi means for mobile marketers, given that the app is still in the testing phase and may not carry advertising until the company is ready to monetize this Pinterest-like service. If Facebook decides to roll out Hobbi more widely, the company has the power to cross-promote the app among its family of apps including its main social network and Instagram, which has become a key driver of sales growth. Hobbi would give Facebook another way to collect information about its users for ad targeting.
Faced with competitive threats, Facebook in the past has copied features from rival social media apps like Snapchat and Houseparty. The test of Hobbi may indicate that Facebook sees a growing threat from Pinterest, which last year boosted its user base by 26% to 335 million. Pinterest last year overtook Snapchat to become the third-biggest social network after Facebook and Instagram. Pinterest is a younger company, but its 46% revenue growth was faster than Facebook's 25% gain in Q4 from the prior year. Facebook's revenue is still 70 times bigger than that of Pinterest, but the digital ad market is maturing and will force social media companies to fight harder for market share in the next decade.
Facebook also has to be cautious about product launches, considering that the company is being investigated by antitrust authorities. The U.S. Department of Justice, the Federal Trade Commission and attorneys general from most states launched an antitrust investigation into Facebook. Senators Elizabeth Warren and Bernie Sanders, both Democratic candidates for president, have said that Facebook must be split up. Even the social network's co-founder, Chris Hughes, last year recommended a company breakup in a New York Times op-ed.
