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Facebook Inc (FB) Users Take a Break

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In the U.S., Facebook Inc (NASDAQ:FB) dominates the social media market. An estimated 67% of the U.S. adult population that uses the Internet have a Facebook account. For those keeping track at home, we’re talking about more than 150 million users checking in, updating their statuses, and consuming the latest gossip. In a world that’s become increasingly connected, it’s not surprising to hear that most of us need some time away from the latest viral cat video. According to a recent study conducted by the Pew Research Center, 61% of current Facebook Inc (NASDAQ:FB) users have voluntarily taken a break from Facebook for several weeks or more. Perhaps even more surprising is the fact that 20% of U.S. Internet-using adults have become ex-Facebook users, as in they aren’t planning on coming back. Could this potentially undermine the long-term value of Facebook’s business model?

Facebook Inc (NASDAQ:FB)Too busy to care
The most popular reason why users took a break from Facebook Inc (NASDAQ:FB) was because they were “too busy” to keep up with the never-ending supply of status updates. Although 21% of Facebook escapees felt overburdened with commitments, the following four reasons had something negative to say about the experience. Together, these detractors made up 37% of hiatus takers, with reasons including a lack of interest, a waste of time, too much gossip, and too much time spent on the site.

Risk to advertisers?
Facebook Inc (NASDAQ:FB) as an advertising platform is very much in its infancy. The company is in the process of developing its ad analytic technology, while simultaneously increasing its monetization efforts. During its most recent conference call, CEO Mark Zuckerberg reiterated Facebook’s three main priorities, including earning the trust of marketers by proving the value of the Facebook platform. This all sounds fine and dandy, as long as engagement levels remain high. According to Facebook, the company finished 2012 with strong engagement across its products and expects the momentum to continue into 2013. However, Pew Research found that only 3% of respondents said they plan to spend more time on Facebook in the coming year, 27% of users said they plan to spend less time, and 69% plan on making no changes to their time spent on the social network.

APRU effects
In mature markets where user growth is slower, there’s a greater emphasis on monetization. Last quarter, Facebook Inc (NASDAQ:FB)’s worldwide average revenue per user was $1.54, whereas the U.S. and Canadian market brought in $4.08 per user. Despite the fact that member growth has been slower in the U.S. and Canada than elsewhere, APRU saw strong growth, rising 22% sequentially and 38% year over year. Even if 27% of adult U.S. Facebook Inc (NASDAQ:FB) users plan on spending less time on the site, the impact may be negligible as monetization remains a key focus.

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