By Mark Zuckerberg
(Condensed and edited by Jim Edwards / Business Insider, from his remarks to investors on July 24, 2013.)
We made some really good progress this quarter with the growth of – in the growth and engagement of our community, the release of new products like Instagram video and advertising growth, especially on mobile.
When it comes to mobile, I’m very pleased with the results. We now have more daily actives on mobile than on desktop. Nearly half a billion people use Facebook on their phones everyday and soon we’ll have more revenue on mobile than on desktop as well. This progress is the result of investments we started making more than a year-ago and in some cases years ago.
One of the questions I frequently get asked are what are the big changes we want to make in the world over the next 5 or 12 years? Now that we’ve connected a 1 billion people, what is the next big ambition? There are three main goals I would like us to achieve. Connect everyone, understand the world and help build the knowledge economy.
Connecting everyone is about growing our community to reach the next 5 billion people. Our mission is to give all people the power to share and make your world more open and connected. And that means everyone. Not just product in developed countries. Most people in the world, they only had the smartphones or data access, but we know that we want to be connected.
We are focused on making this possible, while also strengthening engagement within our existing community. Understanding the world is that helping people share not just day-to-day updates like text messages and photos, but also building up long-term knowledge about the world. But what people are interested in, which restaurants are good, which hotels your friend’s have stayed out and so on.
We should be able to build intelligent services that help you use your network that could answer lots of questions … I want to create our community to create a graph of all that understanding to power this intelligence.
Building the knowledge economy is about helping people create companies and jobs, using information. The way I see our advertising product, we’re not just building a strong monetization engine for our Company. We are creating tools to enable new growth jobs and businesses, [using the Facebook] Platform to support a larger economic shift in the world based on knowledge and information.
I’m proud of the work we’re doing here to help developers create apps to help local businesses, find customers, to help great brand tell their stories and this is the core part of our mission. Now let’s talk about the progress we’ve made in each of these areas. Starting with connecting everyone. The Facebook community has grown steadily this quarter, adding 45 million new monthly actives and the number of monthly active is steady or increasing across demographics and countries.
Facebook helps to maintain your real identity in relationship, which are universal needs.
Next, let’s talk about building more useful services on the path to understanding the world. The newest product I’m most excited about from our last quarter is Instagram video. Adding video fits really naturally with the Instagram mission of capturing and sharing the world’s moments. It’s off to a great start. People are already uploading hours of video to Instagram every minute. I’m really proud of the team and I think they did a great job with this product.
When I first talked to Kevin about this, he had a really smart insight. Instagram has always been about helping people capture moments in a way they’re proud of. Filters were necessary for photos because when Instagram started, most phone cameras weren’t good enough to take high quality photos. But lack of filters isn’t what’s holding back videos from being great. It’s that they’re shaky and feel unprofessional.
Kevin realized that if we can deliver a product that helps people produce stable videos that would really change the landscape and I think it already is. Now some products that video fit into the flow of what people are doing and they take off quickly. Others like Graph Search and Home are completely new kinds of products and they’re just going to take longer to develop.
I’ve used the right strategy to have a balance of long-term foundational new products in ones that fit in immediate demand. We’re committed to building all of these into market-leading products.
Finally, let’s talk about building the knowledge economy and what that means for our core business. This quarter has been a strong period for us. A lot of new businesses have signed up to advertise with us and we now have more than 1 million active advertisers. Our News Feed Ad products are working well for them.
One of the things I watch most closely is the quality of our ads and peoples’ sentiment around them. Right now ads on average make up about 5% or 1 in 20 stories in News Feed. We haven’t measured a meaningful drop in satisfaction when we ask people about their experience with Facebook. We’re comparing that to the result we get when we ask the same question to people using a version of Facebook with no feed ads at all.
With that said, in recent studies people have told us that they noticed the ads more, so we’re going to invest more in improving the quality. Our top priority is to expand the number of marketers and overall demand in our system rather than just increasing the number of ads that we show. We believe that this will help us improve the quality of the ads that we show by creating a more competitive auction and this will create the best experience for people who use our products, the best returns for more marketers and the best results for us.
So that’s my update for this quarter. We had a lot of progress in the last three months on growing our community engagement, releasing a successful major product and generating strong financial results. This quarter also marks the end of our first year as a public company and I think we created a good foundation for the future.
I want to take a moment to thank everyone who works at Facebook and everyone who’s a part of this great community. You are all helping to connect the world and push it forward.
I think we’re early. And one of the interesting things over the past six months or so is reaching 1 billion people was this big rallying cry for the company for a long period of time. And I think as we’ve passed that, we’ve seen the ambition that the company has grow. And reaching 1 billion users was a great first thing to focus on because no one had ever built a service that had 1 billion active people who were signed in and had real identity before.
But in a way it’s actually kind of just an abstract, there’s nothing magical about 1 billion. The real goal is to connect everyone in the world and help people map out everything that there is. Well, I think what we’re seeing is as some of the products succeed is just the ambition increased to be able to do more of these and taking on more longer term things.
Hiring great people especially engineers is one of the biggest challenges that any technology company has. We’re doing really well against the hiring goals that we have. But I mean there was a systemic issue where our country doesn’t produce the volume of engineers that the companies would want to hire. And I think that that’s a lot of what you hear these companies talking about. We’re doing really well competitively right now.
Everyday we ship a lot of tweaks to the products, or small changes to existing products. Then there are going be to products like Instagram video, which is really doing well and it fits very naturally into the current flow of how people use Instagram to capture moments that they’re proud of. So that makes sense. I think the team did a really good job there. The thing is like Home and Graph Search are really new used cases. I mean in the case of Home, it’s a new category of product that’s different from anything that exist out there and I think of its more a seed that we’re planting that its going to create completely new pillar of the ecosystem rather than drafting off behavior that people already have in the system today. So, I definitely think that we just have to look at this over the long-term. And it’s very – when we’re building models for the Company and we basically think that it’s going to be something that we will invest in for years. And we expect these to become marketing – market leading products and they’re doing things that no-one else really has,