It’s common knowledge that Facebook just isn’t signing up as many users as it once was. The plateau makes sense, given the sheer size of the user base, which remains large despite a flurry of reports indicating a teenage user exodus. Those studies didn’t stop Facebook from declaring 63% increase in revenue and an eightfold increase in profit for the fourth quarter yesterday. Facebook said mobile advertising accounted for 53% of revenue in the fourth quarter, up from 49% in the third quarter and 23% a year earlier.

Chief Financial Officer David Ebersman said that in the space of a year, Facebook has gone from barely having a mobile-ad product to being “the best mobile product” in digital marketing. This is good news for Facebook, but not necessarily its user base. The website initiated its ‘pay to promote’ program early last year, allowing advertisers a larger audience across the site. However, the average user is paying for it in the long term,  as user’s posts are allegedly being suppressed and no longer have the large reach that they used to.

Facebook has reported a 2% drop in news feed interaction, and is now replacing  free content with paid content which means a large number of free posts will disappear from people’s feeds as sponsored ads float to the top.

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[Source : WallStreetJournal]