ITEX 2012: Facebook will reach 1.5 billion, Amazon face of e-Commerce

Keynote speaker Jeffrey Cole predicted the demise of MySpace, but says Facebook is here to stay. UPDATE: video of presentation

In 2005 Dr Jeffrey Cole, director of the Center for the Digital Future at the University of Southern California, predicted the demise of MySpace as the leading social network.

Cole used data from UCLA's Internet Report (which he lead at the time), a longitudinal study following 2096 American households since 2000 as they moved from dial up, to broadband, to mobile.

At the time of the fifth annual report in 2005, he called Rupert Murdoch's decision to buy MySpace a great investment but one which would ultimately see the exodus of its teenage users.

Speaking at Computerworld's ITEX conference yesterday, Cole says time has proven him right in that prediction, with teenagers fleeing en masse to Facebook. Facebook recently announced it had signed up its one billionth user - but Cole says even Facebook isn't safe to the whims of a fad.

Two years ago UCLA released its tenth report, and Cole says Facebook is begining to succumb to the same trends that previously affected MySpace.

"To a teenager an online community is like a night club, when the night club becomes too popular or the uncool kids start showing up you're out of there," he says.

"What's the worst thing that could happen to a teenager in a night club? Their mother walks in. Now your mother wants to friend you in Facebook."

He says Facebook will not experience the same fall from grace as MySpace because of its global scale and sheer number of users. Cole expects Facebook to grow to 1.5 billion users in the next two to five years as more members from emerging countries like Brazil and India sign up.

However the way Facebook is used by younger people will change dramatically. It's still going to be the place everyone is going to be, but not necessarily where everyone is interacting. That interaction will be moved into niche social networks, says Cole.

"If you want to find somebody you'll do it through Facebook, if you want a relationship with them you'll move it somewhere smaller," says Cole.

"I don't think there will ever be another 1 billion user social network."

E-commerce

Cole says Amazon will lead the next wave of technology innovation, much as Apple has in the last decade.

"The successor to Steve Job's mantle isn't Tim Cook, it's a guy every bit as smart as Jobs, who can see around the corners, and has just as unpleasant a personality - his name is Jeff Bezos," says Cole.

Amazon, which was started in the late 1990s by Jeff Bezos, sells books, movies, electronics, and even nappies online. It will redefine the way we shop in the future - even more so than it has so far, says Cole.

The company will continue to expand its operations and the line of products it sells, increasingly encroaching on what was usually the domain of local merchants.

He says Bezos has kept up with consumer demand for easy to-the-door shopping and has put his company in a dominant position which might expand further, including in Australia and New Zealand.

Cole predicts Amazon Prime, which allows subscribers to receive free deliveries within two days in the States, will move into same-day delivery as the company builds new fulfilment centres near major populations.

"The only reason you needed to go to the local store to buy a battery is if you need to use it in the next 48 hours, now the only reason you'll need to go is if you need to use it in the next two hours," says Cole.

In the US, Amazon was previously constrained to operating these fulfilment centres in smaller isolated states like Wyoming in order to avoid sales taxes inflating its prices, but a recent decision by the company to accept this tax means the company is now free to build fulfilment centres in states such as California.

See video of presentation here:

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