Wednesday, April 22, 2015

About Facebook, Hyves and Burble, the New Kid on the Block

Dutch social media platform Hyves is an excellent lesson in social media. The Dutch competitor of Facebook was highly popular. At its heyday a few years ago, its revenues reached close to Euro 20 million and it boasted over 10 million profiles. To put it in perspective, the total Dutch population reached close to 17 million in April 2015.

That’s why the Dutch media group Telegraaf Media Groep (TMG) decided to purchase 100 percent of all the Hyves shares. The idea behind the takeover was, that Dutch newspaper “De Telegraaf” would become the biggest player in the market reaching 62 percent of the Dutch readers online. TMG purchased Hyves at end 2010 for a whopping Euro 43 million.

But TMG underestimated that Hyves was already under pressure from global competitor Facebook having a similar target audience. During 2011, users left Hyves in droves in favor of Facebook. Page visits declined from 200 million in January to 150 million in October the same year. Also the number of unique visits per day and the amount of minutes that visitors stayed on Hyves declined sharply.

In 2013, TMG gave up hope that Hyves would remain a relevant social network site. Hyves wa kept alive as an online gaming platform. The group wrote off Euro 36.5 million in booking value.

But when one market player leaves, it creates an opportunity for a new one. Enter Burble, the brainchild of programmer Marlon Barth who owns a small IT company in Rotterdam. He envisions Burble as a modern kind of Facebook where users can create their own profile, communicate with each other en discuss issues. He claims that the environment is safe with data protection, It is free for everybody and is in Dutch.

Will Burble be the next Facebook success or Hyves failure? Let’s wait and see!