Shares of Facebook Inc (NASDAQ: FB) fell over 4 percent on Friday after Chief Executive Mark Zuckerberg announced changes to the platform’s centerpiece News Feed that he said would hit user engagement in the near term.
Zuckerberg said the News Feed — one of the key areas where the social network shows ads — will begin to prioritize "meaningful social interactions" versus "relevant content." This means users will start to see more posts from friends rather than publishers.
Pivotal Research Group said its analysis of Nielsen’s digital consumption rates showed that usage was already falling prior to Zuckerberg’s announcement, although from very high levels. “We can speculate that the concerns reflected in Zuckerberg’s post may very well have been driving these declines,” Pivotal’s Brian Wieser wrote in a note.
The company has been criticized for algorithms that may have prioritized misleading news and misinformation in people’s feeds, influencing the 2016 American presidential election as well as political discourse in many countries. While, Facebook’s advertising would be unaffected by the changes, the shift was likely to mean that the time people spend on Facebook and some measures of engagement would go down in the short term, Facebook said.