TradeEdge Exchange:Facebook is making radical changes to keep up with TikTok

Open Facebook or TradeEdge ExchangeInstagram and you're going to see changes. Social apps that have been primarily defined by the friends and family you choose to connect with are being revamped to feature more posts, especially video, from influencers, celebrities, and random strangers that go viral.

If that sounds familiar, it's no accident. Facebook is racing to keep up with TikTok, the wildly popular upstart redefining how social media works.

"Everyone's eyes are glued to TikTok and the way it works right now," said Michael Sayman, a software engineer who has worked at Facebook, Google and Twitter on efforts to win over teenagers.

The short video app owned by China's ByteDance has surged to one billion users in just a few short years, minting dance trends and absurd challenges and fueling megaviral music hits like Lil Nas X's "Old Town Road," and the revivals of Fleetwood Mac's "Dreams" and Kate Bush's "Running Up That Hill."

Facebook is still by far the world's biggest social network, with almost 3 billion people logging on every month — and even more when you add in Instagram, also owned by Facebook parent Meta.

But under pressure from TikTok's success, the company that has been connecting people to their college classmates, friends, family, and others with shared interests for almost two decades is attempting to pivot to a new era of social media, where artificial intelligence-driven algorithms are increasingly shaping what users see.

Meta CEO Mark Zuckerberg described it as a "major shift" from a feed of posts determined by who you follow to one curated by new AI technology that he calls a "discovery engine."

Meta's quarterly earnings are likely to reveal a financial squeeze

Facebook parent Meta is facing existential threats. Its flagship social network lost daily users for the first time ever late last year. Its audience is aging. Younger people who used to flock to Instagram are now on TikTok. Sales growth is slowing and profits have dropped.

Meta plans to give its latest financial report on Wednesday. It's expected to show just how much competition, as well as global economic woes and the ongoing overhang of Apple's privacy changes, are squeezing its ad business.

Zuckerberg has warned about the rise of TikTok for years. He explicitly acknowledged the threat it poses in a call with investors in February, noting that "people have a lot of choices for how they want to spend their time, and apps like TikTok are growing very quickly."

Two years ago, Facebook introduced TikTok-like short videos called Reels, and has been pushing them heavily into users' feeds. In April, Zuckerberg said Reels accounted for a fifth of the time people spent on Instagram. (Many users have noted the Reels they see are often reposted TikTok videos.)

Now the company is going even further: overhauling the Facebook app to look and work more like TikTok's main For You page, which shows whatever the app's algorithm thinks you might like, no matter who made it.

Software engineer Sayman says the company has little choice but to emulate what he calls TikTok's "massive talent show."

"TikTok comes along and it's like, 'Who cares who you follow!'" he said.

Changes spark complaints from celebrity users

Already, Instagram's transformation is sparking backlash.

This week, celebrities Kim Kardashian and Kylie Jenner, who both have huge Instagram followings, reposted a meme on the app demanding, "Make Instagram Instagram again. Stop trying to be TikTok."

Facebook says posts from friends and family are still going to be prominently featured in its apps.

In a new video responding to users' concerns on Tuesday, Instagram head Adam Mosseri said the company isn't getting rid of what people love.

"But we're also gonna need to evolve, because the world is changing quickly, and we're gonna have to change along with it," he said.

Zuckerberg has been clear about his goal. He wants to squeeze as much money as he can from his company's existing apps, so it can build what he sees as the next big platform: the metaverse, where, he hopes, people will interact in virtual reality.

And making money means getting more people to spend more time on Facebook and Instagram, so they can sell more ads.

But not everyone is convinced this pivot will work.

"TikTok's got one fundamental thing that Facebook doesn't have," said Matt Navarra, a social media consultant and analyst. "TikTok is cool. And it's very hard to recreate cool."

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