ArchiveOriginally published 2011

Facebook in 2011: Video Calling and Payments Between Friends, Revisited

Two Facebook stories on this site in 2011 pointed at the same idea: that the social network wanted to be the place where you called your friends and paid them back. One arrived that summer. The other took four more years and a different shape.

Video calling, July 2011

The announcement was a partnership: Facebook added a video call button to its chat, powered by a well-known internet calling service. You clicked call, installed a small plug-in the first time, and had a one-to-one video conversation in the browser. This site's post noted the obvious: hundreds of millions of people who already had their friends listed could now call them without exchanging usernames on a separate service. It was also a shot at a rival social network that had launched group video hangouts a week earlier. Group calling came to Facebook later; the 2011 version was strictly two people.

Payments between friends

The payments story was thinner and, in hindsight, early. In 2011 Facebook ran a virtual currency for games and apps, and there was repeated talk, some of it from the company and some from analysts, of extending it to payments between people. This site reported it as a launch of a payments-between-friends service; the accurate version is that peer payments were being explored. The feature that matched the headline arrived in 2015, inside the standalone messaging app, letting friends send money from a linked debit card. It was later withdrawn in some countries as the company refocused on payments to businesses and, briefly, on a digital currency project that did not launch.

The survey about paying by phone

A third post from the same period relayed a survey finding that a large majority of North Americans said they were willing to use their phone to pay for things in shops. In 2011 almost none of them could. Phone payments in shops needed near-field chips in phones, terminals that accepted them, and banks willing to put cards into phone wallets, and those pieces took most of the decade to line up. The survey was right about appetite and said nothing about timing, which is the usual shape of a technology survey.

What the two stories got right

Both bets, that people wanted to call and pay within the app where their friends already were, turned out correct. What the 2011 stories could not see was that the winning venue would be the phone messaging app rather than the desktop social network, that video would go from plug-in novelty to something everyone did daily within a decade (helped enormously by 2020), and that payments would fragment by country, with bank-run instant transfer systems winning in some places and messaging-app payments in others.