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Give me a break.
I'm sure it uses cookies, but that's not the point. Cookies are generally tied to a single site, but these new systems are allowing tracking across networks of sites.
Facebook does have interesting user information, but it's hard to imagine "Cookie tracking technology" will be the big win for them.
Chris: Even harder than having to read about all the hype around Facebook is having to write about it all the time. Still, don't you think a specific clue as to how Facebook could actually become so valuable is something worth reading?
see "INconCEIVable!"
I agree with you, the data FB has about a user would be exciting for a third party site, ignoring the privacy debate.
Ps. You *really* need to go watch Princess Bride. Funny stuff.
I haven't seen the movie in years, so I was a little rusty on the reference (thanks, Dave).
I think the implied point in the user comments is simply that the stories on Facebook are not believeable. Many speak of changing economics due to the web, but we already know the economics don't change ever when valuing companies. This has been the case in the 80's with the emerging PC companies, the 90's with everything dotcom including GeoCities, Tripod, and Xoom. Facebook, as well as MySpace, are simply the latest overvalued technology companies who will go through their lifecycles, and ultimately be valued more realistically.
A simple test, what revenue per user does Facebook need to achieve a $100 billion dollar valuation? Compare this number to established media companies who have a defined business model - this includes old media, as well as new media companies like Google, Yahoo, etc. Facebook's per user value is north of $300 at a $15 billion dollar valuation, hence it needs to be at least $2,000 per user today to realistically achieve a $100 billion dollar valuation. What media company books $2,000 per user today?
No media company has per user revenue numbers as high as $2,000 per user per annum. Neither will Facebook.
I hope this "sniff test" helps you as well as many other bloggers recognize the insanity of the chatter surrounding Facebook and its' value. Yes it is a popular site, yes it is growing like crazy, and yes it is bleeding red ink while looking for a business model.
An opportunity exists for bloggers who seek to be the voice of reason regarding Facebook, and today's crop of unproven social networks.
I think you're missing a few things here. First, $2K per user per annum would mean $100B in REVENUE, which is different than a $100B valuation.
Also, the valuation is based in part on user growth, so your $/user figure should take growth into account.
If Facebook had 5 times as many members then they would need a *lifetime* value of $400 per user (@ zero growth) to justify a $100B valuation, which is still difficult but much less daunting than you suggest.
That said, I'm not endorsing the $100 billion number. I've pointed to what those who do believe it are saying, and I'm describing what their case is.
Please go read Lee Lorenzen's post that I linked to. For example, he points out that Facebook is on track to gain up to 200 million active users by next year. Whether or not you agree with such an estimate, a year ago would you have thought that Facebook would have doubled to 50 million active users today?
Specifically, if the number of users keeps going up on Facebook, this means the advertising value of each Facebook user doesn't need to go up in order for the company to become immensely profitable. Facebook would just know more about more people who surf the web, and would then help companies serve up more relevant ads to them.
I was referring to present value, which would need to be $2,000 per user today to justify $100 billion. This is stated as "What media company books $2,000 per user today?".
Facebook doesn't have the value today, and the media companies that are public have the present value defined based on their reported revenue plus growth forecast.
You're argument simply increases the user base, but the result is the same.
Suspect that MSFT has yet to make a nickle on their monetization deal. Was it worth $240M for MSFT to keep that traffic from going to Google? You bet.
Annecdotely we saw a fairly significant increase in click-through rates. Of course this was a small test and we were sharing rev with two additional parties (Overture, who supplied the ad, Rev Science who matched the ad to the profile data).
Glad to see someone else is figuring out a way to take this to the next level and show people ads that are more appropriate to who they are not where they are...
WHAT! NO WAY IN HELL. FIRST THEY SHOULD HIT THE $1B IN REVENUE AND ONLY THEN WILL I GIVE IT A 100X MULTIPLE ON REVENUE. WHAT A JOKE!!!!
You guys are getting crazier than Techcrunch's love fest with Facebook
A common misconception. The rule is a cookie can only be read by the domain that set the cookie. HOWEVER, when you visit a domain, such as VentureBeat.com, the HTML of the page can load images from off-site domains, ad.doubleclick.net for example here. Now let's say I'm surfing Facebook, and Facebook has a deal with doubleclick.net to serve ads through Facebook, they can combine and share everything they know about me. It's easy to do.
I’m sure it uses cookies, but that’s not the point. Cookies are generally tied to a single site, but these new systems are allowing tracking across networks of sites.
Facebook does have interesting user information, but it’s hard to imagine “Cookie tracking technology” will be the big win for them.
u r right
http://seydimat.blogspot.com/
Ooops $100 billion is too much meaningless