There's a good reason why Facebook has well over 2 billion users and an ever increasing share price.
They know how to stay ahead of the trend and are always innovating with new products.
What is Facebook's next innovation?
In this article, I'll talk about what Facebook plans to do with their first hardware device and what this means for brands.
What is the Facebook Portal?
Portal will be Facebook's first hardware product.
Portal will be a video chat device that uses facial recognition to connect users to their Facebook accounts to let them communicate with friends and family.
Rumors are that Portal will be released in the second half of 2018, priced at $499.
Many are comparing Portal with the Amazon Echo.
However, unlike Amazon Echo – which consumers use as a virtual assistant to help them answer questions or find products – the primary use of Portal will be to work alongside the Facebook network.
Is Portal a gimmick?
Whenever Facebook ventures into a new market, people always comment on whether they will succeed or fall flat on their faces.
People laughed when they bought Instagram for $1 billion and thought it was a huge mistake.
Instagram ended up being the steal of the century, but Facebook has had just as many failures too, and the hefty $499 price tag for a device that lets you video call and use Facebook seems rather pricey considering your smartphone does the same thing.
But I think people are misunderstanding the meaning of Portal.
Mark Zuckerberg has stated that he does not care if Portal returns Facebook a profit or not – all he cares about is that it will improve communication between users.
And I believe that.
I think Portal is going to be the first of many hardware products that Facebook will release in the next 5-6 years as part of their larger vision to make Facebook the one-stop shop for all your needs.
Whereas right now you buy tangible products on Amazon, listen to songs on Apple Play or Spotify, and watch TV shows on Netflix, I think there's a good chance that Facebook will merge all these services into one.
Last year they launched Watch in the US for fans to watch long-form content of brands and influencers away from the news feed. Is this their first step to take on Netflix?
Over time we'll see Facebook entering new markets and slowly tying various aspects of their products into one.
Most people today consider Facebook to be a social media network, but behind the curtains they are doing so much more.
What does this mean for advertisers?
For brands, this news is fantastic.
The more spaces that Facebook enters, the more opportunities and placements you'll have to run ads and target new audiences.
There is so little information about Portal online; so far, all talk is focused on consumers, not advertisers.
My prediction is that for the first year or so Portal will be an ad-free platform and Facebook will gather feedback on the product and refine any bugs.
Once the teething phase is over, we may start to see new ad inventory placements for us to use.
There are rumors that Facebook will turn Portal into an iPad. If that happens, there may be potential to build apps that users can easily download through Portal.
Voice recognition technology may let users find businesses local to them or place orders for products directly through Portal.
Facebook Watch could turn into an app listed on Portal.
Facebook has stated that Portal will be the first hardware product of many. As an advertiser I see this as hugely beneficial news.
The bigger picture
I think that too many people are failing to see Facebook's plan for the future and are looking at things at the micro level.
This is Facebook's first big move to enter the hardware market.
Sure, they bought virtual reality start-up Oculus in 2014, but they carried on work under the Oculus brand.
Now they are coming out with hardware under the Facebook name, I think this is the first step of many to enter new markets to eventually become the 207th bone in the human body.
Personally, I'm not that excited to use Portal, but I am excited about what Facebook will do with the platform and how brands can tailor new types of content to engage with the right people
These are my thoughts on Portal. What do you think?