Facebook’s ‘Neighborhoods’ faces crowded niche market, profiling concerns

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2021-06-18 11:30:03

Silhouettes of mobile users are seen next to a screen projection of Facebook logo in this picture illustration taken March 28, 2018. REUTERS/Dado Ruvic/Illustration

June 18 (Reuters) - When Facebook (FB.O) began testing its new “Neighborhoods” feature in Canada last October amid the COVID-19 pandemic, the tech giant described it as a dedicated place for people to connect with their local communities.

Here, in a corner of the world's largest social network, people met neighbors, shared banana bread ingredients, helped locate missing cats and swapped local business recommendations, the feature's product manager Reid Patton said in a recent interview.

But Facebook, which is rolling out the feature in four U.S. cities - Baton Rouge, Louisiana; Charlotte, North Carolina; Newark, New Jersey; and San Diego, California - is already playing catch-up in the red-hot market for local social apps. Community site Nextdoor has emerged as a key player along with Amazon Ring's Neighbors and crime-tracking app Citizen. Nextdoor, which saw usage surge during lockdowns, reported 50% annual growth in daily active users last year.

Facebook has in recent years focused on on-site communities that matter to its users as a tactic to drive engagement. The company, which made the vast majority of its almost $84.2 billion ad revenue last year from smaller businesses, many of whom court local users, also said users' activity and information in Neighborhoods may be used to personalize their experience and ads across Facebook.