How much is Facebook worth to business? The world’s largest social network is trying to answer that with a new Deloitte report it commissioned to measure the economic impact of Facebook worldwide:
“Internet‐based businesses such as Facebook facilitate broader economic activity across a series of economic agents. Such broad impact is far greater than these businesses’ own size: in 2014 Facebook – a company with an approximately $8bn cost base – enabled global economic impact of $227 billion.”
That economic impact breaks down into three main areas: marketing, app development, and connectivity. In other words:
- Advertising products and services through Facebook that people pay for;
- Spurring development of games and other apps that use the Facebook platform;
- Driving demand for the telecom networks and devices that provide access to Facebook.
In Canada, that translates to about $5 billion in economic activity attributed to Facebook, and 82,000 jobs. In the U.S., Deloitte says it’s around $100 billion and more than 1 million jobs.
The interesting thing is how that economic impact breaks down by region. In North America, Facebook is a marketing tool. But proportionally, Facebook is far more important as a platform in Europe, where companies like Spotify and King.com have seen outsize success based in large part on the Facebook app ecosystem (Meanwhile, South America has very little going for it in the apps field). And the developed economies of Europe and North America saw the biggest benefits in connectivity as telecom operators upgraded networks and consumers upgraded smartphones to take advantage of having their social network wherever they go.
Source: Facebook & Deloitte Get the data
We should approach these figures with a little skepticism; Facebook commissioned the study and stands to benefit from it. But this also indicates how fast Facebook is working to transform itself from a fun social network to a deeply entrenched player in every facet of global business.
*A previous version of this story stated that $100 million in economic activity can be attributed to Facebook in the U.S. In fact, it is $100 billion, not $100 million. Marketing regrets the error.
