Facebook Dating is finally here. But the launch of its new service has investors falling out of love with Tinder owner Match.com and Match parent IAC.
Shares of Match dropped nearly 5% Thursday while IAC, which has a majority stake in Match, fell 4%.
The new competition for Match, which also owns OKCupid, PlentyOfFish and Hinge as well as Tinder and the namesake Match app, comes at a time when IAC is considering a possible spinoff of all of its shares in Match.
IAC was not immediately available for comment about the new Facebook dating plans. Neither was Match.
Not everything Facebook touches turns to gold
Investors might be overreacting. Match is still the clear market leader in online romance. And Facebook has a decidedly mixed record with new products, so there’s no guarantee that a dating service will be any more successful than the company’s previous efforts to branch out.
Facebook Local was supposed to kill Yelp, the leading online review site for restaurants and other small businesses, and its shares dropped nearly 10% after Facebook’s December 2015 announcement. Now, Yelp stock is up nearly 25% and it’s still the go-to app for online reviews.
When Snap went public two years ago, it had a rocky start amid continued competition from Instagram, which is owned by Facebook. Snap has surged nearly 200% this year thanks to solid user growth.
Even Groupon, while hardly thriving, survived numerous attempts by Facebook to break into the daily discount space with the now defunct services Facebook Offers and Facebook Deals.
And it goes without saying that Facebook Gifts (RIP) didn’t exactly kill Amazon.
Amazon, too, has launched services that failed to attract a mainstream audience. Etsy’s stock is up nearly 200% in the past two years even though Amazon launched Handmade in October 2017 to take on the arts and crafts marketplace.
And Amazon also recently pulled the plug on its Restaurants food delivery service after it failed to gain ground against the far more popular DoorDash, GrubHub and UberEats.
Just because a company has tens of billions in cash at its disposal and a market value of more than a half of a trillion dollars, that’s no guarantee that the launch of a product or a new service will be a hit.
After all, you probably aren’t reading this story on an HTC First Facebook smartphone or Amazon Fire device.