Facebook has no plans to bring advertisements to its newly launched news aggregator, Paper, as the focus is on user-engagement rather than profit.
Facebook, the world's biggest social networking site, has no plans to introduce ads in its newly launched Paper app, as it is still in its early stages, Facebook's chief operating officer Sheryl Sandberg said during a Q&A session at the Goldman Sachs Technology and Internet Conference, Tuesday. Facebook Paper, launched earlier this month, is a standalone iOS news reader app that brings stories from friends and the world around you in a personalized manner.
Facebook, which draws its primary revenue from ads and marketers, is not willing to inject advertisements into the app. The company's primary focus is to understand how people are using the app, so the overall experience can be improved over time. After attaining a sustained position, chances are the app will host ads like its parent company.
"When we launch products, we are willing to invest for a long time before we put ads in it," Sandberg said, according to CNN. "It's quite easy to see how ads could fit into [Paper] ... but there's no reason for us to do that right now -- we've so much to do with the current monetizing of current products we have."
Facebook's decision not to monetize its new service clearly suggests the company has bigger plans for the app. The news aggregator made headlines much before it was officially confirmed by the social network. It was getting a lot of hype and now that it is officially announced, it has quickly gained rank among the top rated apps in Apple App Store.
Facebook's reliance on advertising revenue is massive. In the most recent quarter earnings, ads revenue generated $2.3 billion, 76 percent up from the previous year.
Facebook can still make huge profits by integrating ads into services other than Paper. The company has emphasized on improving the quality of the ads, rather than just bombarding its social media site with more ads.
"If we can get ads that are better targeted, higher quality, more relevant, we can bring more value to customers and do so in a way that really contributes to the user experience," CFO David Ebersman said Tuesday. "Our aspiration here is for the ads to be as engaging as the organic content you find shared by your friends."
