Strategic Positioning of Facebook and Crypto-Currency Barriers

This report provides a comprehensive strategic analysis of Facebook, focusing on its current market positioning and its ambitious venture into the crypto-currency market with Libra. It begins with an introduction and background, followed by an in-depth examination of Facebook's external environment using the PESTLE analysis, considering political, economic, social, technological, legal, and environmental factors. The report then delves into Facebook's strategic intent behind launching its crypto-currency, outlining its goals, features, and the intended Calibra wallet. Furthermore, it critically assesses the barriers to entry that Facebook is likely to encounter in the crypto-currency market, including concerns about anonymity, security, volatility, and regulatory hurdles. The analysis concludes with a considered evaluation of the potential for success of Facebook's crypto-currency venture, synthesizing the discussed factors and providing a balanced perspective on the challenges and opportunities ahead.

Running Head: FACEBOOK
Facebook’s strategic positioning
Name of the Student
Name of the University
Author Note

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Table of Contents
Introduction and Background..........................................................................................................2
Facebook External Environment.....................................................................................................2
Crypto-Currency Strategic Intent....................................................................................................4
Crypto-currency Barriers to Entry...................................................................................................5
Conclusion.......................................................................................................................................5
Bibliography....................................................................................................................................7

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Introduction and Background
Facebook is the world’s most favored platform for people gathering and interaction. It
uses the virtue of the internet for facilitating effective business opportunities and reaching to all
the remote corners of the world. Facebook has always focused on providing the best experiences
to the uses, developing new projects and associating with new applications (Blachnio, Przepiorka
and Díaz-Morales 2015). With the introduction of new technologies, Facebook also entered the
world of crypto-currency for involving in new businesses.
The discussion about the external environment of Facebook with the help of the PESTLE
analysis model, followed by the strategic intention about Crypto-currency and the barriers to
entry, is briefly presented below.
Facebook External Environment
The external environment of Facebook can be described well by the model of PESTEL
analysis. Facebook is considered to be one of the leading websites of social media and used by
near about all types of customers. The strategies to maintain such a title on the international
platform is only possible by the brand development, investments on research and developments
and popularity (Vezzoso and Nicholls 2019). The analysis will clearly display the requirement is
the change of the strategies for maintaining its position in the market and keep competing with
the rivalries. The website, services of advertising and mobile application have a significant
impact on the other available websites or applications such as YouTube, Twitter, Snapchat, etc.
By the PESTLE analysis, the external environment of Facebook can be understood in
which it operates. The factors under consideration in this analysis are the political, economic,

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social, technological, legal and environment. All this factor represents the external environment
of Facebook.
Political- The government is a huge factor in affecting the business of Facebook, the shift in
political landscape changes the business progress (Taskinsoy 2019). For globalization of the
business, the political support is a huge support for the company, the stability in the politics
brings opportunities for the company, however, some barriers and banning on products from
some countries can turn out to be treated to the company. Another political disadvantage is the
action on the data present on the online platform.
Economic- The growth in the business is shaped by the economic factors. The new trends of the
economy will affect the macro-environment of Facebook (Danielsson 2019). In the developing
countries the growth in the economy will provide the opportunity of business for Facebook, the
stability in the economic status of the countries are opportunities to flouring for the organization
and lastly, the raised in the income of people is also a benefit to the organization. All the factors
of the economy help in penetrating the economic market easily.
Social- The social culture affects the business of Facebook the most as the condition of the social
aspect has most of the influence on the popularity of the organization (Simon, Brexendorf and
Fassnacht 2016). The preference of the customer to the quality rather than the quantity becomes
an opportunity for the organization, the CSR (Corporate Social Responsibility) provides the
required support to the flourishing business and this increases the opportunity for organizations
like Facebook.
Technological- Facebook is based on online technologies; the influences that the company has
on its environment are both threats and opportunities. The increase in the number of customers
on the online platform that the offline place has benefited the company, people, uses mobile

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devices more than the earlier days and the availability of the internet and accessing the
application from remote locations have turned out to be a great opportunity for the company.
However, one downside is the increased number of competitors and most of them are choosing
the online platform to attract the online traffic. The retaining of the customers is effectively done
by the advertising services of Facebook.
Legal- The business structure of Facebook follows the laws imposed on them for performing all
the necessary legal activities of the organization. They have increased the support of free Wi- fi,
the availability of patent laws all throughout the world (McManaman 2019). The amount of data
increasing by the use of the application is huge, hence regulation of the data use and sharing is
coming on the way of smooth operations of the company. One of the biggest legal aspects that
Facebook has faced is getting the required products and services from China as the rules have
been getting strict day by day.
Environment- The sustainability of the operations of the company is increasing for the
increased use of the internet. Due to the change in the climatic condition, the shift in the location
of the business can be expected and this may be a downside of the business (Utami and Lantu
2014). The shift in the choice of offline buying to online buying has increased the accessibility of
the products and services more and Facebook being totally an online platform, the online buying
facility has taken it towards being an opportunity.
Crypto-Currency Strategic Intent
The new launching of the crypto-currency by Facebook is the Libra (Abraham and
Guegan 2019). It aims to be used for buying items, sending money to others, cash out, spend
through third-party applications, use at grocery stores. Facebook is also intended to build its own
online wallet which is called as Calibra Wallet.

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The company also aimed to be launching a company called Calibra. This subsidiary
company y will handle all the dealing of the crypto-currency basically handle the Libra payments
while protecting the privacy of the users. It will also prevent the information of the user from
connecting with Facebook so that the advertisements cannot target the users. The payment
transaction won’t be connected to the Facebook accounts. The developed crypto-currency by
Facebook has the backup of international assets and can be used anywhere across the world. The
company’s main intention is to provide a simple currency that is usable globally and access by
all. The crypto-currency will be handled by an association which is a non-profit organization.
Crypto-currency Barriers to Entry
The introduction of crypto-currency in not new on the social platform. However, a social
platform like Facebook has proposed the idea of launching crypto-currency that contains the
most amount of data and information about the people all across the world is a matter of security.
The barriers to entry of Facebook’s Libra are; the anonymity is a matter of concern, it is found
that the crypto is facing several hacks and scams (Groß and Leon 2019). The availability of
variable crypto-currency is decreasing their values; thus the value of the currency may not be up
to the expectation in the coming days. The peer-to-peer nature of the currency is making it
unsafe. The dealings in the black market are now done on crypto-currency; hence the chance of
association of the crypto-currency is not fully disclosed. This raises the possibility of
anonymously dealing and association with criminal activities (Senarathne 2019). The value of
crypto-currency fluctuates quickly, hence the volatility of the currency is extreme. This makes
many users to not prefer these type of currencies. All these factors may be the barriers for
Facebook to enter for the crypto-currency.

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Conclusion
It can be concluded that Facebook’s external environment is affected by several factors of
politics, economic, social, technological, legal and environmental. All these factors contribute to
the shaping the business environment and strategic growth of Facebook. The crypto-currency
propped by Facebook with the association of several other organizations is Libra and it is
expected to launch in the mid of the year 2020. The strategies intended by the organization are
expected to flourish with keeping the customer first. Then the barriers to entry in the world of
crypto-currency that are discussed are most common for all the emerging crypto-currencies.

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Bibliography
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