How Does Facebook Make Money From New Resources?

I’m in no doubt, you are known that the Facebook is the most visited website in the world after Google. However, do you know how Facebook earns money? It is working on several monetization methods and making a steady revenue growth year-by-year.

With over 1.59 billion active users as of Dec 31, 2015, the company one thing for sure knows how to add more users and mint more money showing them ads they love to click.

You may check the recent Facebook earnings report, and you will come to know that 2015 was a good income year for Facebook.

facebook-earnings-report

It is mainly due to the company that has always focused on two things, how to add more users to the platform despite the occasional negative opinions and how to attract more advertisers that sell to these users.

I have already written a post on how Facebook earns money through traditional ways and today I will take the post further and give you an idea of how Facebook makes money with its recent resources.

New Facebook Revenue Sources

Now, let’s see how the recent acquisitions and content monetization plans of Facebook bring a load of revenue.

how-facebook-makes-money

Recent Acquisitions of Facebook

Facebook has always bought new promising products that have profitable future. It has invested about $25 billion in buying 14 companies in total. It’s often been criticized for making over hyped deal paying a huge amount for buying companies, but Facebook as always proved that its deals are rewarding in the future.

Most acquisitions like Friend Feed (real-time newsfeed about friends), Face.com (facial recognition software), HOT.com (a design firm in NY), Oculus (virtual technology startup) have been behind the scenes and make Facebook a better product and experience for users.

While others like standalone apps like WhatsApp, Instagram, etc. make money by contributing to the revenue stream of the company.

Here are some of its latest Facebook revenue sources that help it generate a constant income.

1. WhatsApp

Facebook’s largest acquisition till date, has made messaging seamless over the years. WhasApp might not be the most revenue-generating source for now, but Facebook made anywhere between $20m last year. WhatsApp recently did away with its $1/year plan making the platform free for all recently

2. Instagram

Instagram was Facebook’s most popular buy that has proved a profitable deal ever since. Instagram has even outperformed Facebook in terms of engagement level. It is making a good amount of online revenue. Instagram opened up showing ads in October last year and introduced video ads before a couple of days.

The simple logic behind Facebook buying products and companies into its own portfolio is that it can further monetize them with successful strategies. For example, having bought Instagram for 1 billion dollars that is roughly broken into $30 per user. 

For a company like Facebook, making $100 out of a $30 user is no difficult game. So, there is profit and future business goals that drive every acquisition of Facebook.

Facebook officially hasn’t yet confirmed any earnings report for Instagram, but trade analysts predict Instagram to rake in 5 billion dollars per year in near future.

3. Facebook-Microsoft Agreement

Even though the Facebook and Microsoft have ended their partnership after 7 years for Bing search engine, both giant officials said that they will continue to have a great partnership in other areas. 

Recently, both the companies have joined hands to play a game in virtual reality space. You may read their partnership deal details through this Businessinsider article

Facebook Earnings Through Content Monetization Plans

Facebook, as a standalone product has also evolved itself to generate multiple sources of income other than the native advertising.

The company has introduced video content (that is giving the video mogul YouTube a tough competition with 4 billion views per day), revamped the messenger app and the notes platform (to provide competition to traditional blogging platforms like Blogger and WordPress.com).

Let’s have a look at how does Facebook makes money through content monetization plans!

Messenger App

Facebook has now made it more addictive to businesses to join messenger. It has made it easier to enable them to get organic interaction on the platform. It will thus monetize them at some point.

Facebook Messenger is soon to support companies paying bills to and receipts to customers via messenger. They will also provide shipping details of goods purchased via messenger. It is huge to bring in business to Facebook in near future.

Videos

Facebook has had great success with video on its platform recently. It has already started making money by introducing video ads on both its platforms Instagram and native Facebook.

Facebook, like YouTube, recently proposed allowing users to monetize their own video. This scheme works on a revenue sharing model in which it will keep 45% of the revenue you generate on monetizing your videos.

Mobile Users

Facebook’s largest asset is its mobile users! Facebook has left us to be mobile commoditized with all its planning and we easily support it. Yes! Facebook make great profits through mobile advertising as a huge percentage of us use Facebook on mobile platforms.  

This Facebook revenue is generated by showing us mobile ads; enabling celebrities to reach out and making companies sell their products to us. If you are still wondering how Facebook makes money through small screen gadgets, read the recent post of VentureBeat about the Facebook ad revenue on mobile

Wrapping Up

The giant social network, Facebook is still on the rise, introduces fresh features and makes huge money based on its acquisitions and content. Not only the above mentioned earning sources, but the Facebook would also earn money through Facebook Instant Articles that runs on mobile devices.

Besides, the company turned more intellectual and likely to earn money from unlikely places. You might be wondering with its immense growth, but I would say that its innovativeness brings satisfying features for users and thinks from a business point of view.

I hope that you are very clear how does Facebook makes money. Do you agree with my viewpoints on its growth? What do you think about the new earning sources of Facebook? Did I miss to mention any important monetization method of Facebook with which it makes a recurring income?

I would like to know your valuable views on how Facebook makes money, use the comment section to share your thoughts.

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23 thoughts on “How Does Facebook Make Money From New Resources?”

  1. Hi Nirmala ,

    You have researched well for Facebook Revenue I often think that how this top gaint make their revenue.Here you wraped the everything in one blog.Loved this blog post 🙂

    1. Nirmala Santhakumar

      Hi Ravinder,

      Thanks for reading my post, good to know that you have liked it.

      Yes, I’m keen interested to know how this giant is making a massive income. Stay tuned!

  2. Hi Nirmala,
    I am a big Fan of Mark Zuckerberg and always want to know about him and his income. And I must say that you have done great work, I have got some new things from this post of yours.
    keep up this good work.

    1. Nirmala Santhakumar

      Glad I could help you in knowing about Mark and his earnings through his social network giant site, Facebook, Robin.

      Thanks for getting time to check the income stats of FB.

  3. Thank you for the analysis Nirmala. I think the biggest revenue comes from Ads. Actually, they earn from the content we share on our wall. The good thing about Facebook is they regularly update feature and remain the market; very different from Google plus which is not yet commercialized.

    1. Nirmala Santhakumar

      Yes Ravi, you are very exact.

      They make huge revenue through ads and our content. Yeah, it has been introducing the innovative features and thus standing out from the crowd in winning peoples heart.

      Glad you liked the post, thanks for reading. Keep sharing your valuable thoughts here!

    1. Nirmala Santhakumar

      I love to write about social networks, Muhammad.

      Moreover, I’m curious to know their monetization methods and steady revenue through several sources.

      I’m regular to FB News Room 🙂

      Thanks for reading the post and leaving your feedback. Keep visiting.

  4. This is really amazing maan !!! you have been always unique and comes with new topics that attracts readers to you blog !! its always difficult for me to find a new topic to publish in my blog but you just showed me the way to select the topic that attracts readers. Yeah when comes to this post it’s really impressive and useful !! i have to appreciate your hardwork and research for it. Keep posting and inspire us 😉 😀 🙂

    1. Nirmala Santhakumar

      Thanks for your kind appreciation Aryan Alex. I know the mindset of your readers and their requirements. It makes me to draft and publish some interesting piece of content.

      Glad I could inspire you to blog with new ideas, stay tuned!

  5. Hi Nirmala,

    It is indeed an interesting post to know about the major revenue sources of this social networking giant.

    Adding Videos to the many ways how facebook monetize the content sounds exciting. It seems it is going to be the one n all platform in recent times.

    Thank you for sharing all the information. Take care 🙂

    1. Nirmala Santhakumar

      Welcome to my blog Manidipa, I’m glad about your presence.

      I aware of your blog and visited few day back 🙂

      Thanks for reading the post, pleasure to write the interesting content for my dedicated readers.

      I’m wondering from where you have fallen here? Facebook?

      Have a good day everyday, keep visiting!

      1. Thank you so much for the warm welcome Nirmala and glad to know that you visited my space.

        Might be Facebook :), but I doubt if anyone in this blogosphere is unacquainted about this blog. And this article also provides some interesting facts to know.

        Hope to see some of your thoughts on my pages. Take care 🙂

  6. Hi Nirmala,
    Excellent post and you have done great work. I have got some new things from this post. wonderful topic and explained well.
    Thank you for the analysis.

  7. I think this is only reason thats why Facebook and all other company are focusing to get mobile user to get sticky on their site.
    Yes! Facebook is one of the largest social networking site and it have other project also like WhatsApp and Instagram and more.

    Thanks 🙂

    1. Nirmala Santhakumar

      Thank you Jack for leaving your views, I agree with you.

      More awesome stuff are on the way, stay tuned!

  8. Hi Nirmala
    You had written a great post. All people like to use social sites. facebook is most popular site. Thanks for sharing this post.

  9. Hello Nirmala madam,
    I must say that you did some great research on Facebook. Yes Facebook is growing faster than any other social networking site out there, it has already acquired some popular companies specially whatsapp and instagram which we all heavily use in our everyday life.

    Thanks for the informative post.

  10. Hello Nirmala,
    Mark is not satisfied with just facebook but he is an unstoppable guy which we can see by his acquisitions of Whatsapp, Instagram and all. BTW, you have shared a great article from where we can know about Facebook and their source of funding.

    Thanks a lot.

    1. Nirmala Santhakumar

      Thanks Joydip for sharing your viewpoints, I agree with you.

      I feel good with your kind words, keep coming.

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