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Until a couple of months ago, you may have noticed your Facebook (NASDAQ: FB) news feed was dominated by content from publishers and businesses that you liked. The updates you saw from friends may have been nothing more than a link to an article with a bit of commentary. That led many analysts to believe that personal sharing on Facebook was declining, and a report from The Information in April confirmed that assumption.
But Facebook's head of the news feed, Adam Mosseri, denies that personal sharing is declining on Facebook. He told the audience at TechCrunch Disrupt in San Francisco that its users continue to share more original content but that publishers and businesses are sharing content at a much faster growth rate.
Although Mosseri refutes that personal sharing on Facebook is declining, should investors be concerned that publishers' content is growing faster than individuals'?
The average Facebook user consumes 200 pieces of content
Mosseri dropped another interesting fact about Facebook's news feed. The average user will spend about 45 minutes in the news feed and see 200 pieces of content per day. Facebook's algorithm determines what 200 things users see from about 2,000 possible items. The average user only sees about 10% of the posts that the people and businesses they follow make.
That's important, because even if the share of personal content on Facebook is declining, Facebook can still show a ton of personal posts to its users if that's what they want to see. In fact, that's exactly what Facebook is doing after updating its news-feed algorithm in June.
Personal content is often more engaging -- getting users to comment and like more -- and it's something users typically can't get anywhere else. That gives Facebook lots of valuable data for targeting advertisements and keeps users coming back every day to make the news feed a daily habit. As such, Facebook has a vested interest in keeping a significant portion of its users' news feed personal.
The huge amount of content posted on Facebook is a huge benefit for the company, and it's recently started implementing a similar algorithm on Instagram as more and more users join that platform.
Personal sharing happens on personal platforms
The problem Facebook faces is that a lot of personal sharing is shifting to more personal platforms. Snapchat and other messaging apps are more appropriate for sharing things with close friends. The average American Facebook user has 350 "friends," with younger users having much more.
While Facebook has a pretty good idea of who your real friends are and who your Facebook friends are, sharing something personal has the potential to reach everyone you're connected with. Many users may want to keep those personal updates to a much smaller circle of acquaintances.
Facebook, for what it's worth, owns the two most popular messaging apps in the world, with Messenger and WhatsApp. Each has 1 billion users. Facebook has yet to monetize these apps, but it started sharing data between WhatsApp and its main platform to improve friend suggestions and ad targeting last month. Still, Facebook doesn't have access to the personal content users are sharing on its messaging apps.
As users share more personal content on other apps, they're spending more time in those apps. Snapchat's users, for example, spend a whopping 25 to 30 minutes per day with the app. With only so many minutes to spend with various media platforms in a day, Facebook stands to lose out on some time spent on its platform.
Thus far, Facebook has been able to stave off that pressure. It says users spend 50 minutes per day across Facebook, Instagram, and Messenger. That's up from 40 minutes two years ago. Facebook doesn't provide any details about which apps are causing the growth, but its ad revenue indicates that it's doing just fine without all the personal sharing coming its way.
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Adam Levy has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Facebook. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.