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Deep into Michal Lev-Ram’s fine new cover story on Facebook in the just-out issue of Fortune is this startling fact: Facebook made an average of $35 last quarter on each of its U.S. and Canadian users, ten times the amount of per-user revenue it collects in the Asia-Pacific region. That rich-world/poor-world dichotomy is about what you’d expect. But it masks an important problem for Facebook. Its North American user growth has slowed to a relative trickle while it still adds users in the places where its advertising isn’t nearly as lucrative.
Facebook’s finances aren’t discussed nearly as much as all the other issues facing the company. But this bit of analysis helps explain why it’s so important for Facebook to offer new kinds of products. Yes, Facebook faces a scandal at every turn. And, as Lev-Ram writes, it is busily trying to rid its network of fraud, manipulative fakery, election interference, and the like. It’s doing so, though, primarily as a way of preserving a business that isn’t growing the way it used to.
The “pivot to privacy” that Mark Zuckerberg announced last week—and previewed in interviews with Fortune—are as much about finding new lines of business as they are a response to privacy concerns, competition, and regulatory challenges.
In its sprint of a 15-year existence Facebook (FB) already has made more than one heroic pivot. Now it needs to do so again. “I just think getting to the right model over time is going to help build a stronger community,” Zuckerberg told Lev-Ram. One question among many is: How much time?