Facebook: a friend or foe to hosters?

Editor’s Note: This is the first in a series of guest posts by Phil Shih, founder of Structure Research.

There is little doubt that Facebook has at least in some way become a competitive threat to hosting companies. People use Facebook as both a publishing and communication medium and it has become central to their daily lives. Even just a few years ago people may have chosen to publish a blog or personal website. Or they may have signed up for an account on Flickr and shared their photos there. In some cases – like Flickr – they would have used a free service. But in many cases they would have spent money on a domain name and some Web hosting. Fast-forward to 2012 and its clear more people are opting to use Facebook as a replacement for hosting a Web site. The larger consumer market, as a result, has become much more difficult to target.

But individuals are not the only demographic using Facebook. Businesses have been drawn to the power of the social network and have launched company pages there. Facebook has so much momentum we are even beginning to see the facebook.com/companywebsite URL more often than the traditional Web address in advertisements. With the amount of traffic going to Facebook it is simply good business to have a presence there. Ignoring Facebook is tantamount to shutting a business off from a significant piece of the market.

Will Facebook replace the traditional domain + website model?

So is Facebook going to do the same in the business market? Is it going to replace traditional Web sites and further impact the hosting business?

The short answer is no and this is at the heart of why we believe that Facebook is actually more a friend than foe. That is right. The social network that is stealing business away from you is still a friend to be embraced.

Let me explain. The notion of Web presence has changed. It is not just about a Web site anymore. Web presence is multi-faceted. It is about a Web site, a Facebook page and a Twitter feed. People go to all three places and in no particular order. This does not mean that standard Web presence is losing value. Far from it. In fact, all three are important and they complement rather than replace each other. But in the business arena Facebook pages are reinforcing the value of the Web site rather than replacing them. They are driving traffic to each other and extending a company’s reach to a wider audience and with greater speed. At the end of the day the real issue is how to integrate all three and find synergies between them.

Opportunities for hosters

And this is where hosters can jump in. Hosting is no longer just about providing a domain name and space on a server. It is about helping customers solve problems in the realm of Internet technology. With Facebook and Twitter, online presence has become much more complicated and that is great news for hosters. They have an opportunity to step in and add value by sorting through and making sense of that complexity. Hosters can build out social media Web presence for customers. They can help set up services where they create and manage Facebook pages and align content and messaging with the traditional Web site (that is of course still hosted with them!). Over time we fully expect hosters to take advantage of APIs and build automated tools for managing multiple Web presences from a single platform – owned and monetized by the hoster.

There is no denying that Facebook is in some ways a competitive threat. But the good news is hosters can offset the negative impact by moving up-market and focusing on the business space where Facebook is a just another part of the complexity that is the modern Web presence. Bring Facebook in and make it a part of the hosting value chain and you will see how it can be turned from a foe to a friend.

3 thoughts on “Facebook: a friend or foe to hosters?

  1. Nice article. I had this thought a few months ago, “wait a minute, is Facebook gonna replace websites?” Then, I thought it through and assumed that not having a website is like not having a store front, a place to go for additional services.

    I see FB as a great way to target people. But, having a website still shows people that I have a business with everything you would expect a legitimate business to have. I also believe in some ways not having a website shows that you are may not be a well established company. 

    So, in a world where image is everything, I still see the website as a way to prove, that you are indeed better than your competition.

  2. Terrific article. Times have certainly changed in the hosting business. I hope there are some talented programmers out there wanting to run with this and have this ‘web presence platform’ integrate with our WHM’s. I guess for the time being it’s a good idea to become a guru at integrating social media with websites. Thanks heaps Phil for sharing your insights.

  3. This post has solid some points to consider.  I agree that FB is subsuming some of the functions of a standard web presence, but for the most part, to the extent that FB replaces your web site, it all “depends” on what your business does and what you’re trying to achieve online.

    I think Facebook, along with other cloud-based services (eg. Tumblr for publishing, Google Apps for email + productivity, Smugmug for photos, Wix for small business sites, etc.) are disrupting the market for personal & small business hosting.  They hit the trifecta of being very simple-to-use, generally single purpose for the customer need, and have been optimized for getting a user started and satisfied very quickly (onboarding).  Contrast those with a typical hosting environment, which can be very intimidating, especially to a smb-type who just needs it done and generally bounces once a roadblock has been hit.

    Cloud-based services are exploding.  There’s a wysiwyg editor for every niche, and a SaaS solution promising to alleviate any and all business woes.  That said, I will bet on the fact that businesses will not want to bury themselves under the facebook.com domain (eg. facebook.com/mybiz).  The future is in cloud-based services attached easily and seamlessly to a business’ domain assets.

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