Why Facebook Inc. (FB)’s Entry Into Work Application Is Not A Threat Yet For LinkedIn Corp (LNKD)?

Facebook Inc. (NASDAQ:FB) push to become a key player in the professional workplace space with its Facebook at Work innovation continues to elicit debate especially on its impact on LinkedIn Corp (NYSE:LNKD). Rosenblatt Securities Martin Pyykkonnen during an interview on CNBC argued it was highly unlikely that Facebook will invest a lot of money on the innovation. Pyykkonnen believes the giant social network will continue to pay more attention to the advertising segment that continues to generate a greater chunk of the company’s total revenue.

LinkedIn could be in trouble should Facebook Inc. (NASDAQ:FB) gain much-needed traction of the corporate space considering it is backed by 1 billion active users against LinkedIn’s 300 million. LinkedIn gets almost two-thirds of its total revenue from HR’s looking for potential candidates and Facebook gaining market share of the space could considerably affect its revenue stream.

Pyykkonnen argues it will be a tall order for Facebook Inc. (NASDAQ:FB) to develop entire needed infrastructure to compete hand in hand against LinkedIn.

“I just can’t imagine; they are going to build all the infrastructure that you would need in the software development to go after LinkedIn Corp (NYSE:LNKD)’s core model. Facebook going after advertising technology that’s the core that makes sense said Mr. Pyykkonnen.

Facebook entering the space could in away undercut LinkedIn Corp (NYSE:LNKD) in terms of pricing as competition could be ripe with clients looking for the best option in terms of pricing and exposure. Facebook push to create a social platform and a professional platform with the Facebook at Work application according to Pyykkonnen makes a lot of senses but will not have any threat to LinkedIn core business operations.

“One of the things when you think of this from the user’s standpoint, we always talk about your personal life you don’t want to show your boss that trip to Vegas. That notion that you have a personal profile, and a professional profile makes some sense,” said Mr. Pyykkonnen.

Facebook at Work platform will be used as a business networking tool allowing users to share vital information as well as share a wide range of document types.

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