Facebook is becoming more like Twitter as the most popular social media network on the planet is getting increasingly politicized and filled with "more and more fake news," according to Ross Levinsohn, former Chief Executive Officer at Yahoo who also served as the President of Fox Interactive Media. In a Friday call with CNBC, Levinsohn stated that the Facebook-owned Instagram lately turned into a service that Facebook itself used to be, an online platform where people go to see what their family and friends are doing. The 53-year-old expressed that sentiment while commenting on Snap's first earnings report and the inevitable comparisons between Snapchat and Facebook that many industry watchers are making, especially as Facebook recently started aggressively introducing Snapchat-inspired features to its services.
Despite the parallels, Facebook is not too similar to Snapchat and is only differentiating even further as it matures, Levinsohn said, adding that the platform is overburdened with heavily curated content that now populates the majority of its News Feed. On the other hand, the Snapchat Discover system is an entirely new, innovative channel, the former top executive at Yahoo stated, noting that the Venice, Los Angeles-based company's idea of blending several different media formats into one presents a unique opportunity for advertisers. Following that train of thought, Levinsohn claimed that Snap's disappointing Q1 2017 financials shouldn't be a worrying factor for investors in the long term, though he admitted that marketers will now likely have more leverage for lowering the advertising rates on Snapchat. Regardless, Snap should stay firm and not agree to lower rates based on its somewhat underwhelming performance in the first quarter of the year, the technology executive believes.
It remains to be seen whether Levinsohn — who doesn't even consider Snap a social media platform — is right in predicting that Snap will turn its fortunes around in the future but the self-described "camera company" still has a lot to prove to the investors who fueled its $34.7 billion market capitalization following its initial public offering (IPO) in early March, though the thereof now amounts to approximately $22.5 billion. An update on the company's performance will follow in the coming months.