FB Stock: Could Facebook, Inc. Put Twitter, Inc. Out of Business?

facebook stockNew App “Notify” Could Be a Boost for Facebook Stock

Microblogging web site Twitter, Inc. (NYSE:TWTR) is in for another bad day on the market. After catching its breath above the $30.00 mark, TWTR stock is once again routing back to its all-time lows. The latest dent in Twitter’s stock price may be a result of social media rival Facebook, Inc. (NASDAQ:FB), which has dropped a new bomb on Twitter. Will this “bomb” be a boost for FB stock? It’s possible.

Could This Be a Game-Changer for Facebook Stock?

Facebook has finally rolled out its rumored news application called “Notify,” which sends user-specific push notifications to smartphone lock screens. In other words, Facebook will not only dominate users’ phone usage, but it will also keep inviting them back to their phones, should they put it away, with notifications about recently posted news items that fall under the user’s selected interests.

The idea is to increase the amount of content users consume without cluttering up their social media feeds. Facebook has not yet monetized the app, but has partnered with publishers to produce content according to user preferences.

Should this idea be successful, Facebook will eventually move to charge some solid bucks from advertisers; you can count on that.

Mobile users are already accustomed to receiving push notifications on applications installed on their phones, so how will Notify’s notifications affect Twitter? The unique thing about Facebook’s Notify is its scope of news coverage.

Notify gives users the option to choose what sources they want to hear from or those they care about. The users are able to receive the latest news on anything and everything, ranging from football matches to recommended music videos, business and financial news, weather updates, entertainment and celebrity news, and more. From daily deals to local shopping events, users can even keep up with the Kardashians with real-time notifications from the app.

When clicked upon, notifications will take the users directly to the publisher’s app or web site, wherever the content is published, instead of Facebook. In short, users will be getting more out of it than they would from Twitter.

Clearly, Notify poses a direct threat to Twitter’s core business that thrives on news. Facebook’s move to claw at Twitter’s dominance in this niche is so lethal that it could further drive down Twitter’s already meager monthly active user (MAU) numbers.

The app has opened its gateways to only iOS users in the U.S., so it’s not too big of a threat right now. However, Facebook has set the ball rolling and Twitter must come up with a fitting response or face extinction.

The Bottom Line for Facebook Stock

Technically, TWTR stock seems to be heading into a freefall again. After finding some support around $29.00, I’m seeing a reversal in TWTR stock’s pattern.

Twitter has released some exciting features this quarter, including promoted “Moments” and video ads, but Facebook is moving much faster than Twitter. For Twitter stock to stay afloat, CEO Jack Dorsey must move his focus from the other company he leads, Square, back to Twitter, and on an urgent basis at that.

The bottom line: owners of Facebook stock could be the winners of the coming microblogging wars. I see turbulent times for TWTR stock ahead.

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