How is Facebook coming at these challenges? By being aggressive and getting bigger of course. Its recently announced purchase of Instagram for $1 billion ( http://dealbook.nytimes.com/2012/04/09/facebook-buys-instagram-for-1-billion/?_php=true&_&_r=0 ) so close to the IPO is not a sign that Mark Zuckerberg is distracted or confused. Rather, I see it as a shrewd move to deepen their presence in two key and area in which Facebook is weak: photo sharing and mobile. Facebook will gain much needed expertise in photo capture, as social media engagement is becoming more and more about expression through photos. Similarly, as the cameras on smartphones continue to improve, more users will be taking mobile pictures and will want to post them immediately. Instagram will bring expertise and technology in both of these areas into the Facebook fold – that is why they paid so dearly (about 2x of recent valuation estimates) for the company.
I believe it will pay off for Facebook in the not too distant future. With the Instagram purchase they will have new marketing channels and users to satisfy their growth-hungry investors. They will have mobile expertise that will allow Facebook to better monetize their existing social media platform in an increasingly mobile world. Users will benefit from having a better experience overall – with both platforms. Facebook’s lawyers may not like being so busy working on an IPO and an acquisition at the same time, but as a strategic way to prepare for where your customer is going to want to interact, It seems to me that Facebook will be a very interesting public company to watch.