Growth of Facebook’s mobile presence a concern

As the technology world sifts through the mountains of minutiae contained in Facebook Inc.’s initial public offering filing Wednesday night, it becomes clear that the one aspect of the social network giant’s business with the greatest potential to fundamentally alter its fortunes — mobile — is both its greatest risk and its greatest opportunity.

Although Facebook represents the most powerful agent of change in the era of the social Web, the core services of the company — linking friends, sharing connections and trading tidbits of information — were born in the era of the personal computer, before the rise of the smartphone and the dawn of the tablet revolution.

Increasingly, Facebook’s ardent users are checking in via mobile devices.

Therein lies what very well could be Facebook’s biggest problem.

Since Facebook doesn’t place third party advertising on its mobile sites and inside its applications, it generates no revenue from its mobile operations. In a world where the next billion Internet users will ex- perience the Internet not through a PC, but through a mobile device, that’s a big problem for Silicon Valley’s brightest rising star.

In order for Facebook to realize the untapped potential which prompted Wall Street investors to place an estimated value on the company at upwards of $100 billion US, Mark Zuckerberg — Facebook’s founder, chief executive, chairman and now, controlling shareholder — will need to find a way to solve the company’s mobile looming mobile conundrum.

It’s a problem that isn’t lost on Facebook. The company lays out its mobile problem on page 12 of its S-1 filing to the U.S. Securities and Exchange Commission, under a section entitled “Summary Risk Factors.”

“Growth in use of Facebook through our mobile products, where we do not currently display ads, as a substitute for use on personal computers may negatively affect our revenue.”

Later in the document, Facebook expands on its mobile quandary, pointing out that although it recognizes the potential for disaster, the company, to date, has not found a solution.

“Although the substantial majority of our mobile us- ers also access and engage with Facebook on personal computers where we display advertising, our users could decide to increasingly access our products primarily through mobile devices,” the company says in the document.

“We do not currently directly generate any meaningful revenue from the use of Facebook mobile products, and our ability to do so successfully is unproven. Accordingly, if users continue to increasingly access Facebook mobile products as a substitute for access through personal computers, and if we are unable to successfully implement monetization strategies for our mobile users, our revenue and financial results may be negatively affected.”

There are more than enough “ifs” in that last sentence to cause at least a few potential investors to raise a curious eyebrow.

It’s clear by the filing that Facebook realizes that a clear mobile strategy is key to the company’s future revenue growth. Mobile advertising is still in its infancy. In 2010, the global market for mobile advertising was estimated to be worth about Us$1.5-billion. That number is expected to grow to $17.6 billion by 2015.