A recent study by two researchers at Princeton University has gotten a lot of attention recently, as it predicted that Facebook (NASDAQ:FB) will likely go the way of MySpace and lose 80% of its users within the next three years.
The study uses a controversial method to arrive at its conclusion. John Cannarella and Joshua Spechler from the university's mechanical and aerospace engineering department compare Facebook's user-growth curve with those of epidemics. Just like the bubonic plague in the 14th century, the researchers argue, Facebook will eventually end up dying. Google (NASDAQ:GOOGL) and Twitter (NYSE:TWTR) could also be in danger, as "ideas, like diseases, have been shown to spread infectiously between people before eventually dying out, and have been successfully described with epidemiological models," the authors claim.
Not all research is created equal
It's no secret that Facebook has been losing teen users recently. The company itself admitted this trend last year, which was later confirmed by digital consultancy iStrategy Lab, which claimed that Facebook had 25% fewer teen users in 2013 than it did in 2011.
This fact could apparently support Princeton's study, which has not yet been peer-reviewed. However, the reality is that the paper is full of flaws.
First, the researchers found that Google Trends data was accurate at predicting the course of a flu outbreak, because the need for information regarding the flu follows the same cycle as the flu itself. Tacitly assuming that Google Trends is accurate at predicting other things, they used it to predict the future growth of Facebook. As a result, they found that the social network would almost be gone by 2017.
It turns out that using Google Trends to predict things could lead to crazy results. Mike Develin, a data scientist at Facebook, used the same algorithm with the number of "Princeton" searches on Google. He found out that by 2018, the university would have only half of its current enrollment, and by 2021, it will have no students at all. Using the same method, he even finds out that, since the Google Trends for keyword "air" has also been declining steadily, by year 2060 there will be no air left!
The missing factor
As Media's CEO Gary Vaynerchuk noted, the Princeton study is missing something obvious. The habits of teens and adults are quite different. People tend to experiment more in their teens and early 20s. And they are prone to change their social apps more frequently. However, adults' habits are less likely to change. They go to their favorite spots over and over again.
The fact that a lot of Facebook users are 30 or older should help the social network to stay around for many more years. Once an adult user gets accustomed to Facebook, he won't change his entire online social network to a different app unless there's a very strong reason for doing so.
In this way, losing teens may not be as bad as it seemed to be in the first place. After all, teenagers are difficult to retain. From a pure user-demographic perspective, it may be harder for Twitter to keep its users. This is because Twitter's core group in the U.S. is made up of those between the ages of 13 and 44, with the 18-24 age bracket making up for almost 20% of Twitter's total users.
Final Foolish takeaway
Princeton's study does not take into consideration the well-known fact that adults' habits are less likely to change. At the moment, Facebook may be losing teens to Snapchat. But on the bright side, there are now relatively more adults on Facebook with higher acquisitive power, and who are less likely to move their entire online social activity to a different platform.
As fellow Fool contributor Andrew Marder notes, Princeton's study shows investors once more how important it is to take research, even from a prestigious source, with a grain of salt.
Adrian Campos has no position in any stocks mentioned. The Motley Fool recommends Facebook, Google, and Twitter. The Motley Fool owns shares of Facebook and Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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