The Internet advertisement industry is the next big thing, considering the increased amount of time people spend on their web enabled devices. A recent study conducted by IDC and commissioned by Facebook Inc (NASDAQ:FB) shows that almost 700 million users spend an average 30 minutes on Facebook. Along with the time spent online, Internet enabled devices are also increasing. The Internet used to be limited to computers but now even televisions (Smart TV) and gaming consoles are online. The single biggest impact however has been due to the increase in smartphone penetration.
Smartphones allow users to stay online in every place imaginable and have significantly increased the average time a user spends online. The usage of social media has also greatly increased due to this development. Facebook Inc (NASDAQ:FB) currently has the ability to attract more than a billion consumers every day for a significant amount of time. This fact places Facebook on a clear advantage over rival advertisement companies such as Google Inc (NASDAQ:GOOG). Users of Google visit the website when they need to search something, but they visit Facebook Inc (NASDAQ:FB) regardless of need. Therefore if Facebook is able to provide search and email services, it can create troubles for Google Inc (NASDAQ:GOOG).
This ability to attract users can allow Facebook Inc (NASDAQ:FB) to become a leader in a number of different services. The company can provide video services, online market place, exchange services etc. The possibilities for Facebook seem limitless, and the company is definitely headed in the right direction. Mark Zuckerberg was a little late to the smartphone market and initially missed out on the mobile growth.The company has since revamped its mobile strategy, and the recent financial results show that a major portion of revenues now come from mobile.
Facebook Inc (NASDAQ:FB) is already expanding into innovative services like its Facebook Gift and recently launched a search tool that allows users to seek out everything from running trails to restaurants on their Friends Network. The company has free text and video calls, and if it further develops these abilities and specifically targets smartphone users, it can become an alternative to Skype, Viber, and Whatsapp.
The leading software companies of the world are increasingly following the Apple Inc. (NASDAQ:AAPL) trend and trying to control their own hardware. Microsoft Corporation (NASDAQ:MSFT) recently launched its first foray into computer hardware with the new Surface RT and Surface Pro tablets. The software giant is trying to change its focus on PC and adapt itself to the growth in handheld devices.
Google has also launched its own Nexus series while Amazon is already known for its Kindle tablet. The Street expects that Facebook will soon follow the trend with its own Facebook mobile. The company has always denied that it plans to control its own hardware or manufacture a smartphone. According to recent news, though, Facebook will launch a ‘Facebook mobile,’ which will be manufactured by the Taiwanese smartphone company HTC. The phone will carry the Android operating system and be moderately priced to attract the third world users of Facebook. More details are still pending but HTC has previously partnered with Facebook for its ‘Status’ series.
Facebook has the ability to become a global powerhouse in Internet advertisement. The company is already experimenting with some exciting new services and has the ability to compete with established market players. The stock is still trading below its IPO value and presents an excellent buying opportunity. Facebook is currently trading 25% below the mean sell side target price and it seems it can go even higher.
The article The Biggest Technology Growth Story originally appeared on Fool.com and is written by Mohsin Saeed.