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I did a back of the paper calculation as to how much fb would earn via me as a user. I noticed a user like me spends about 15 mins a day on facebook and see aro
by ankit219 7y ago
I did a back of the paper calculation as to how much fb would earn via me as a user. I noticed a user like me spends about 15 mins a day on facebook and see around 6 sponsored posts. Internally FB ads are all CPM based, at about $4-5 per CPM, no matter the optimization advertisers choose. In a year he would have seen about 2000 impressions, and hence minimum price would be around $10 per year. (There are many users who spends a lot more time and hence the revenue multiple will be higher)
But there is more revenue than just that. FB allows advertisers to reach specific audiences, and even create lookalikes, so overall, there will be a %age of the users seeing more ads than me, potentially personalized for them, and average revenue per user would be higher.
- s1artibartfast 7y agoI think your numbers are pretty far off if you look at Facebook financial statements, and a more accurate cost would be around $200/yr for a daily user [1]. US & Canada had 189 million daily users and a quarterly Ad revenue of 8.487 Billion dollars. That is $45 per user per quarter. [1] https://s21.q4cdn.com/399680738/files/doc_financials/2019/q3/Q3-2019-Earnings-Presentation.pdf https://s21.q4cdn.com/399680738/files/doc_financials/2019/q3...
- ankit219 7y agoYou might be right. I was replying to the parent comment which said facebook should have a ad free subscription product at $2-3 per year. Just tried to say that the Revenue per user is more than that. Also, the numbers you posted include all the inventory - facebook news feed, ads on the side right on desktop, instagram, messenger ads, stories ads, instant articles, and even the ad network. According to facebook (read somewhere) 70% of their ads are on the ad network.