Transfer Pricing Associates

Facebook Announces a Decrease in the Number of Teen Users

post Friday November 15, 2013

Tags: facebook, shares, social media

social network

During its recent quarterly earnings call, Facebook announced that the number of its “younger teenager” users decreased. The announcement resulted in a decrease in the after hour share price of the company.

Approximately a year ago, Facebook dominated the social media market.  42% of the surveyed teens preferred Facebook over any other social media platform, as it reads from the study of Piper Jaffray. The results of the study show a clear decrease in the preference of teens towards Facebook; 33% during spring and reaching 23% by fall.

It can be implied from the study that the underlying reason is that teens do not feel at ease with having their parents in the same social circles as their friends. The fact that their posts can be seen by their family members as well, prevents them from freely posting their thoughts.

Facebook’s market share is being divided among other players as well. Twitter has been reported as being the second most popular social network. Snapchat, a photo messaging application, showed a significant increase in its user-base and Instagram is still on the top of the preferred list. However, none of these social media sites are direct competition to Facebook, since they all emphasize different ways of communication.

There are on-going speculations about what the drop in the number of teen users means for Facebook. However, the news certainly affected investors on the market.

Source: Forbes

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