Tuesday, December 6, 2011

Facebook Swallows Another Company Whole

By Embra King

This week Facebook has announced the purchase of the location-based company Gowalla for an undisclosed amount. This comes right around the time that Foursquare (The largest LBA provider) announced that they have just recently exceeded a user base of fifteen million.

Location-based apps are only a year or so old and are growing thanks to the explosion of smart phone owners. With the purchase of the Texas based company, it appears that Facebook has big plans for what these types of apps can bring to networking, marketing and social reviews.

Facebook's biggest challenge is to increase the usage of these apps. While Foursquare boasted about their fifteen million subscribers, triple that of what they had at this time last year, a recent study has found that only about 2% of the subscribers actually use the product at least once a week.

It will be interesting to see if this most recent purchase is more of an acquisition of Gowalla's talent, or if they have plans for integrating this new app into Facebook’s already large social networking toolbox.

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