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Facebook Ad Business Weakening Despite Surge In Traffic Amid COVID-19

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Facebook Inc. said it is seeing significant growth in the use of its services amid the cornovirus or Covid-19 pandemic. However, revenues are hurt due to lesser ads mainly in countries taking aggressive actions to reduce the virus' spread.

In a blog post, Alex Schultz, VP of Analytics, and Jay Parikh, VP of Engineering reported that much of the increased traffic is happening on messaging services as many more people are using Facebook apps across the world as the pandemic expands.

People are physically distancing themselves from one another to stop the spread of the virus. They are also using its feed and stories products to get updates from family and friends. However, the higher traffic do not generate increased revenues as the company "don't monetize many of the services."

Over the last month, total messaging has increased more than 50 percent in many countries which are hit hardest by the virus. In these places, voice and video calling have more than doubled on Messenger and WhatsApp.

In Italy, since the start of the crisis, the social media giant reported up to 70 percent more time spent across its apps. In a week, Instagram and Facebook Live views doubled. Facebook also reported over 50 percent growth in messaging, while time in group calling, i.e., calls with three or more participants, increased by over 1,000 percent during the last month.

The company said the usage growth from COVID-19 is unprecedented across the industry, and that there are new records in usage almost every day.

The company said, "We're monitoring usage patterns carefully, making our systems more efficient, and adding capacity as required. To help alleviate potential network congestion, we are temporarily reducing bit rates for videos on Facebook and Instagram in certain regions."

The COVID-19 pandemic has reached 190 countries around the world, causing 19500 deaths and 425,964 confirmed cases of infection.

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