With all the recent talk of breaking up big tech in the news again lately, one of the most common refrains is that the big internet companies (mainly Google, Facebook, Amazon, and Apple) are so big and so dominant that no upstart competitor can possibly succeed against them, in part because if they get too big, those giants will just "copy" the competitor and put them out of business. This narrative has gotten a lot of support from the story of Facebook effectively copying SnapChat a few years back. But, it's important to note just how rare this actually is. The history of tech innovation is littered with disrupted giants which often tried, but utterly failed, to "copy" the upstart.
For many, many years, we've talked about this. Part of the problem is that "copying" features or or services is what we've referred to as cargo cult copying, where you're really just copying the tacit, visible features, but without a deeper understanding of why people really use a tool or service. It's why Microsoft failed in trying to just copy Intuit out of business. It's why Facebook failed when it tried to just copy GroupOn (back when people thought GroupOn was a disruptor to Facebook's local ads). It's why smaller companies frequently out innovate giant, dominant incumbents. Part of it is that the incumbents don't notice the innovation until it's too late, but more often because they don't really understand why an innovation is so disruptive -- often because it attacks their position in a tangential way. That wasn't the case with SnapChat and Facebook, where the competition was more direct and more core to Facebook's business.
But the difficulty in "just copying" is driven home by a really great recent article by Josh Constine at TechCrunch, talking about how Mark Zuckerberg totally misunderstands TikTok and why it's a threat to Facebook. TikTok, of course, is a giant in its own right (part of Chinese internet giant ByteDance, which creates its own problems). However, in recently leaked recordings of Mark Zuckerberg addressing Facebook employees' questions, he notes that TikTok is a threat, and how they're trying to copy its service in markets where TikTok doesn't have a hold yet.
Are we concerned about TikTok’s growing cultural clout among teens and Gen Z, and what is our plan of attack?
MZ: So yeah. I mean, TikTok is doing well. One of the things that’s especially notable about TikTok is, for a while, the internet landscape was kind of a bunch of internet companies that were primarily American companies. And then there was this parallel universe of Chinese companies that pretty much only were offering their services in China. And we had Tencent who was trying to spread some of their services into Southeast Asia. Alibaba has spread a bunch of their payment services to Southeast Asia. Broadly, in terms of global expansion, that had been pretty limited, and TikTok, which is built by this company Beijing ByteDance, is really the first consumer internet product built by one of the Chinese tech giants that is doing quite well around the world. It’s starting to do well in the US, especially with young folks. It’s growing really quickly in India. I think it’s past Instagram now in India in terms of scale. So yeah, it’s a very interesting phenomenon.
And the way that we kind of think about it is: it’s married short-form, immersive video with browse. So it’s almost like the Explore Tab that we have on Instagram, which is today primarily about feed posts and highlighting different feed posts. I kind of think about TikTok as if it were Explore for stories, and that were the whole app. And then you had creators who were specifically working on making that stuff. So we have a number of approaches that we’re going to take towards this, and we have a product called Lasso that’s a standalone app that we’re working on, trying to get product-market fit in countries like Mexico, is I think one of the first initial ones. We’re trying to first see if we can get it to work in countries where TikTok is not already big before we go and compete with TikTok in countries where they are big.
We’re taking a number of approaches with Instagram, including making it so that Explore is more focused on stories, which is increasingly becoming the primary way that people consume content on Instagram, as well as a couple of other things there. But yeah, I think that it’s not only one of the more interesting new phenomena and products that are growing. But in terms of the geopolitical implications of what they’re doing, I think it is quite interesting. I think we have time to learn and understand and get ahead of the trend. It is growing, but they’re spending a huge amount of money promoting it. What we’ve found is that their retention is actually not that strong after they stop advertising. So the space is still fairly nascent, and there’s time for us to kind of figure out what we want to do here. But I think this is a real thing. It’s good.
However, as Constine points out, this shows that Zuckerberg totally misunderstands why TikTok is so successful.
TikTok isn’t about you or what you’re doing. It’s about entertaining your audience. It’s not spontaneous chronicling of your real life. It’s about inventing characters, dressing up as someone else and acting out jokes. It’s not about privacy and friends, but strutting on the world stage. And it’s not about originality — the heart of Instagram. TikTok is about remixing culture — taking the audio from someone else’s clip and reimagining the gag in a new context by layering it atop a video you record.
That makes TikTok distinct enough that it will be very difficult to shoehorn into Instagram or Facebook, even if they add the remixing functionality. Most videos on those apps aren’t designed to be templates for memes like TikToks are. Insta and Facebook’s social graphs are rooted in friendship and augmented by the beautiful and famous, but don’t encompass the new wave of amateur performers TikTok elevates. And since each post to the app becomes fodder for someone else’s creativity, a competitor starting from scratch doesn’t offer much to remix.
That means a TikTok clone would have to be somewhat buried in Instagram or Facebook, rebuild a new social graph and retrain users’ understanding of these apps’ purpose…at the risk of distracting from their core use cases. T
This is the same exact story that we've told a bunch of times in the past (including a few of those links above). Even if Zuckerberg recognizes (correctly) that TikTok represents a competitive threat, the company can't just copy its way out of that competition. Because TikTok's entire approach and audience is different, and the core reasons why people use TikTok are fundamentally different than the reasons they use Facebook or Instagram even if they look similar on the surface. As Constine astutely notes, Facebook could easily offer the same features as TikTok, but that wouldn't lead to usage.
Again, that would just be cargo cult copying: copying the visible parts, without being able to understand or effectively copy the real reasons why TikTok is so successful, which is the cultural, community aspects of what makes it such a big deal. This is not a unique story. It's what happens time and time again. Cargo cult copying is easy. It's easy to see certain features or a certain app and make a clone. But that won't make people use it. This same issue was explored quite well by Ben Thompson in a recent Exponent podcast, in which he notes that Zuckerberg, for all his success, still doesn't seem to fundamentally get what makes Facebook, Facebook -- and this could lead to significant problems down the road.
Facebook is large and powerful -- there is no doubt about that. But the idea that it can simply copy any upstart competitor and put them out of business is a premise that is not supported by history at all.
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