Slashdot Mirror
Facebook Expected To Go Public Next Week
First time accepted submitter foozie writes "Many credible sources, including Forbes and CBS, say that Facebook will finally IPO next week, raising about $10 billion and valuating at $75 billion, almost three times the valuation of Google at the point of their IPO in 2004. This shift raises questions about how the new ownership will affect the company's ability to innovate and remain on the forefront of social media."
Innovate? I think we're already past that with Facebook, no?
If you're looking for innovation, personally, I'd look elsewhere -- Way past the social-network situation that we see graying at a rapid rate.
Since when has Facebook innovated since its creation?
shifting around the GUI elements every few months is NOT innovation.
Troll is not a replacement for I disagree.
It won't IPO next week. It might *file* for it. Sigh.
This headline and summary are totally incorrect. The story is that Facebook is going to FILE for an IPO, which is a big difference from actually going public. It will be months before that actually happens. For any gullible readers, you won't be able to buy or sell FB shares next week.
Once again, come to slashdot to see news stories mangled up beyond recognition by incompetent editors.
That is a pretty poor measure of innovation, since it basically defines innovation by popularity. Maybe Facebook was marketed better than its competitors; would consider that to be "innovative?"
Palm trees and 8
You pretty much summed it up. I fear that Facebook is a one-trick pony. "And now, for our next act... uh... hm... where's that card..." What more can they realistically do, other than poach internet services from competitors like Google?
Facebook messaging is encroaching on email turf, but I doubt it will ever replace an independent email service; no one trusts them, and it's unrealistic to force all your email recipients to join Facebook; this was AOL's downfall as well.
The comparisons with AOL are accurate and portend future trouble for Facebook. The broader, out-of-control Internet has a way of bypassing closed systems with ever more flexible and innovative alternatives.
Sooner or later, someone will think of something even easier and more convenient to use than FB, and FB will begin to lose its relevance. I have no idea what; it could be some sort of mobile-to-mobile chat and messaging paradigm that bypasses the website-based interfaces like FB's, or maybe a return to basics because of social network fatigue.
Personally, I've grown tired of FB after using it somewhat extensively for a year or two. It's been a great way to get back in touch with old classmates and the like, but the novelty's worn off and I now find it tiresome to sit down at a computer, bring up facebook.com, and read some oh-so-clever status messages from people who should be working or reading or (God forbid) exercising :)
it's = "it is"; its = possessive. E.g., it's flapping its wings.
There were so many example of Net venture wasted all the money being pumped into them, and yet, the financial world never learn
In this case it's even worse. Think about it: What's the point of an IPO? It's so that a company can raise money, to fund expansion or revitalize the company.
So, does Facebook need money to expand? No, they're undoubtedly sitting on a mountain of cash already. They're not a little company that needs capital to expand, and they're not a big company with aging plant and equipment that needs a capital infusion to get with the times.
The reason for the IPO is obviously so that the existing owners can cash out.
You're missing an important one, and the one that eventually caught up to microsoft. If you're using stock options as a form of compensation you eventually have to go public, because the company cannot have more than some number of shareholders and be considered private.
Facebook may need to expand, a lot. Who knows what their plan is? They may need a massive infrastructure investment to support higher bandwidth in system applications (videos, 3d games, who knows), and they may need a massive investment to hire a large number of staff to start running revenue generating activities, along with a building full of lawyers to go with it all (advertising sales teams mostly). If they're serious about making facebook into a platform rather than just a webpage there's a lot of time and money that could be thrown into basically writing a giant web OS.
But Facebook faces a lot of fundamental problems. First off, if they have a billion users a 75 billion dollar IP values each user at 75 dollars. That's... absurd (admittedly, not 75/year, but even at 7.5/year you're pushing your luck, that requires a lot of suckers giving you 75/year for each user who contributes nothing). Right now they sell facebook points, which is all well and good, but 3rd parties take I think 70% of that. So again, you need to be moving a LOT of money per user.
So how else do you get money? Well advertising. And again, what is a user worth on facebook to an advertiser? My Facebook experience is going to be different than in the US, because they feed different ads to canada, but right now the ads they feed me are for very sketchy (not necessarily illegal, just not really serious big businesses). Valuing a facebook user might be like trying to value television viewers, but 10x harder.
Or you can sell your data to companies. Which is where this whole thing starts to fall apart fast. Facebook is now big enough that they're going to get buried in Laws from every country in the world (see the Twitter story that just got to the front page for another example). Some of those rules are going to be 'no selling data, anonymized or not, without explicit consent' and suddenly your whole revenue stream is first a legal quagmire, and second very very limited. And laws may be written about targeted ads (see previous paragraph), ads to under 13's and compliance...
So yes, the existing owners want to cash out, and I'm sure a lot of them are looking to jump ship ASAP. But google started as just a search engine, and now they have more products than I can keep track of and billions in revenue (and profits), so you never know. I would not be surprised if Facebook has a lot of thought going into what their future will look like and the manpower and infrastructure to support that gets expensive fast (when you're funded by private capital anyway).
I don't see why you think Facebook has no revenue. Google makes crazy amounts of money selling advertising based on the information that they've harvested. Facebook harvests even more information (their tracking cookies are personally identifiable and, for a couple of hundred million people, linked to real names, addresses, dates of birth, and so on, and they have a lot more personal communication to mine than Google), and sells not just advertising but also the information itself. Until people realise that Facebook is selling them a service worth a couple of dollars a year in exchange for personal information worth tens or hundreds of dollars, they'll keep making money...
I am TheRaven on Soylent News