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A Look at Facebook’s Sleeping Giants

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Facebook’s other properties

Does Facebook (FB) have a life beyond Facebook? While the flagship Facebook app has been the company’s primary source of revenue and profits, Facebook has multiple assets that could be just as profitable (QQQ) as the main app.

These include digital platforms WhatsApp, Messenger, and Instagram. Beyond these platforms, Facebook has Oculus, its bet on the $12.3 billion VR (virtual reality) market.

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No clarity on WhatsApp monetization

Facebook last reported that WhatsApp has 1.2 billion monthly active users, which makes the app nearly four times larger than Twitter (TWTR) in terms of monthly user count. In terms of making money off WhatsApp, Facebook has largely chosen to remain vague about monetization of WhatsApp. But the app could pull in revenue from supporting fee-based business communications.

Messenger and Instagram are ad-oriented

Like WhatsApp, Messenger also boasts 1.2 billion monthly users. Facebook has hinted that the monetization of this app would be multipronged in the sense that it would come from fee-based services and ads.

As for Instagram, which has 700.0 million monthly users, Facebook is in the early stages of monetizing it. Facebook said earlier this year that Instagram had attracted more than 1.0 million active advertisers. Instagram is Facebook’s challenger to Snap’s (SNAP) Snapchat.

Risk of revolting advertisers

A look at these apps alongside Oculus and their potential suggests that Facebook isn’t short on growth opportunities. However, for businesses that it hopes to monetize through advertising, ultimate success will hinge on how the company navigates issues of marketers feeling that Facebook and Alphabet’s (GOOGL) Google have grown too powerful in the advertising space.

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