Is Facebook Pulling the Plug on FBX?

While Facebook’s ad offerings continue to grow, the social network is downgrading the importance of its real-time bidding (RTB) ad exchange Facebook Exchange (FBX), as the technology is no longer as effective in today’s increasingly mobile marketplace.

Facebook introduced FBX back in 2012 as a solution for retargeting on desktop. But at an industry conference hosted by Adexchanger last week, attendees tweeted that FBX might die off.

However, Facebook has confirmed with ClickZ that the company doesn’t have any plans to completely abandon FBX in the near future. Instead, the ad exchange will continue to serve advertisers who want to reach people on desktop with more relevant ads. And FBX will be one of nine Marketing Partner Specialities launching in mid-February of this year.

“[FBX] is part of Facebook’s programmatic offering along with the ads API, which offers functionality like Custom Audiences,” Facebook tells ClickZ.

Industry participants agree Facebook shouldn’t cut FBX anytime soon, especially when programmatic is on the rise. “Why would Facebook remove programmatic control from advertisers at a time when money is flowing into programmatic buying at a faster pace?” says Alden DoRosario, chief technology officer at online advertising network Chitika.

Although Facebook will keep FBX in its ad stack for a while, the company won’t add more mobile features to the ad exchange, even though mobile accounts for the majority of its ad revenue, instead focusing on newer products.

“Facebook has a very big priority right now to bring in mobile brand advertising. And the company will increase its emphasis on mobile,” says Rebecca Lieb, Facebook analyst at Altimeter Group.

Given the fact that Facebook is adding more and more retargeting capabilities to Custom Audiences, which is not only mobile-friendly, but also cheaper than FBX for marketers, it’s likely that Facebook is going to downplay the importance of FBX.

“It’s definitely a step back,” DoRosario notes. “Of course, with an organization as large as Facebook, you know any move on this front is related to the company’s broader ad strategy. Specifically, Facebook may decouple FBX to act as a backbone to a spinoff, more standalone ad product outside of Facebook.”

Do you think Facebook is smart to downplay the importance of FBX?

Image via Shutterstock.

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