FB Stock: Facebook Released a New App and Users Aren’t Impressed

Facebook StockWill Facebook Inc.’s Moments Be a Hit?

Facebook Inc. (NASDAQ:FB) stock surged more than two percent on Monday, which might have something to do with the company dropping the photo-syncing feature from the Facebook app. But why would having fewer features be good for the FB stock price? Well, because by eliminating the sync feature, Facebook users would be encouraged to download another popular app from the company—“Moments.”

Back in 2012, Facebook introduced automatic photo syncing from a smartphone’s camera to the Facebook mobile app. According to the company, people used to take photos with their phones, but still uploaded them mostly from computers. Once users enabled the feature, the Facebook app would automatically sync photos from the smartphone and users could post them directly to their Facebook profiles via the mobile app.

So, what will happen after January 10, when this feature is removed? Well, if you still want Facebook’s photo sync feature, you’ll have to download a separate photo-storing and photo-sharing app called Moments. (Source: “Facebook is Killing Photo Syncing, Asks Users to Download Its ‘Moments’ App Instead,” TechCrunch, December 14, 2015.)

Moments was first launched in June of this year. The app features Facebook’s face-recognition technology and can create photo albums for users and their friends automatically. For group photos, the app also uses location and date information.

Since its launch, Moments has become popular on both “iOS” and “Android”-based devices. Right now, it is in the top 10 lists of the most popular free apps on both platforms. With Facebook dropping the sync feature on its main mobile app, the userbase of Moments is about to get a boost.

Users were less than impressed with the news. Following the announcement, Facebook users complained about having to install additional apps on their phones.

“What’s a little annoying is that it’s yet another app that you need to download from Facebook,” tech blogger Mario Aguilar wrote on Gizmodo. “The company just keeps fragmenting its service. ‘Unbundling,’ as we jerks in the tech punditry like to call it, makes a certain amount of sense, but man, it’s freaking annoying.” (Source: “Facebook Moments Makes Photo Sharing Easy, But Ugh, Another Facebook App,” Gizmodo, June 15, 2015.)

You might wonder whether Facebook’s strategy would work because the company is asking users to download something they may not want. However, this is not the first time for Facebook to make a move like this and the last time it did, it turned out quite successful.

Facebook used to have a messaging feature in its main mobile app. Users could send messages to each other directly from the Facebook app, but in 2014, the company decided to discontinue the messaging feature. Instead, if users wished to continue messaging their friends via Facebook, they would have to download the company’s now-popular chat app, “Messenger.” The result was that Messenger has become one of the most downloaded free mobile apps in the world.

The reason behind Facebook’s success with its Messenger app and the Moments app is quite simple: these are good apps that Facebook users love to use. Since users have already enjoyed them as features embedded in the main Facebook app, their excellent user experience could easily continue on as standalone apps. Moreover, Facebook’s dominant position in the social media business also helped.

For instance, hundreds of millions of Facebook users have tried the messaging feature of its main app. They are not going to leave their Facebook friends just because the feature is dropped. Instead, they will download the Messenger app to continue to stay in touch with each other. The Messenger app now has 800 million monthly active users (MAUs)—not bad compared to Facebook’s 1.55 billion.

Bottom Line on Facebook Stock

Of course, plans don’t always work out perfectly and Facebook is no exception. For instance, the company has removed “Slingshot,” “Riff,” and “Rooms”—all apps created by Facebook’s Creative Labs—from the app store.

Owners of FB stock should probably avoid the early criticism. Previous changes have been loudly criticized by users before. However, updates and new iterations generally quiet the critics.

Facebook might not always get it right the first time, but that should not stop FB’s stock price from going higher.

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