4 ms·
Thanks, that is helpful additional info. So to summarize, the market value of facebook assumes 1) It becomes co-dominant web-advertiser with google in the US
by rubidium 11y ago
Thanks, that is helpful additional info.
So to summarize, the market value of facebook assumes
1) It becomes co-dominant web-advertiser with google in the US
AND
2) It finds another way to make some money (either by other advertising markets OR other products/features that people pay for).
- mr_luc 11y agoWhich is pretty plausible, right? (Becoming co-dominant with google). The other thing to consider is the competitive/strategic landscape. It's not so much that the market 'assumes' that Facebook will invent new ways of making money, but rather that regardless of who figures it out, facebook is so incredibly well positioned at the moment (ubiquitous social network) as to give it a large competitive advantage, and let it eat other companies' lunch. The market has examples of other similarly well-positioned companies, like Microsoft in the early 90s, to draw on.
- mathattack 11y agoI view it as an AND/OR 1) It dominates advertising for the long future AND ( 2a) It's discount rate (US govt borrowing rate plus a risk premium) is very low OR 2b) It finds another way to make money ) Facebook's main advantage is a treasure trove of real data about real people, who use their real names.