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His point is that Facebook IS making revenue. And they do it from ads, mostly. If you gave away DRM-free music on an ad-supported site, and found a way to make

by unalone 18y ago

His point is that Facebook IS making revenue. And they do it from ads, mostly. If you gave away DRM-free music on an ad-supported site, and found a way to make people want to click those ads, you'd have a good model - providing you found a good way to provide DRM-free music that people wanted. For Facebook, the problem is that they took a long time getting an ad model to work. Their new one is a pretty effective one that takes advantage of the best parts of Facebook. I think they've rounded a difficult corner.

kwamenum86 18y ago
They lose tens of millions each year because they are relying on cheesy display ads. That is not a sound business model. Ads are not going to support users on a social networking site like fb, in my opinion. revenue!=profit
- alaskamiller 18y ago
  Are you familiar with their financials? Their sales decks? Their full range of advertising products? Are you aware of the revenue for other social networks? MySpace is going to clear $1 billion in revenue this year, a year faster than Google did. Facebook isn't doing the same numbers but they could, they limit the advertising in order to increase user experience and pursue non-traditional advertising to avoid having their site end up as a friendster. These are strategic decisions, and if it takes them 10 years to fulfill it then, great. That's on them. Maybe that sort of investment secures them 25 or 50 years of high margin profits. There is no textbook time-line for companies to follow.
  - unalone 18y ago
    Yeah. I kind of understand the argument that Facebook wasn't running a very good system for revenue: until they released their targeted ad system, they were fairly hit-and-miss and their ads never seemed interesting. Now, they've done what Google did: they made their ads relevant and very much part of their bigger system. I've clicked a few ads, now, because I'm seeing things that I want to click. That's a big breakthrough for Facebook.

by unalone 18y ago

kwamenum86 18y ago

They lose tens of millions each year because they are relying on cheesy display ads. That is not a sound business model. Ads are not going to support users on a social networking site like fb, in my opinion. revenue!=profit

alaskamiller 18y ago
Are you familiar with their financials? Their sales decks? Their full range of advertising products? Are you aware of the revenue for other social networks? MySpace is going to clear $1 billion in revenue this year, a year faster than Google did. Facebook isn't doing the same numbers but they could, they limit the advertising in order to increase user experience and pursue non-traditional advertising to avoid having their site end up as a friendster. These are strategic decisions, and if it takes them 10 years to fulfill it then, great. That's on them. Maybe that sort of investment secures them 25 or 50 years of high margin profits. There is no textbook time-line for companies to follow.
- unalone 18y ago
  Yeah. I kind of understand the argument that Facebook wasn't running a very good system for revenue: until they released their targeted ad system, they were fairly hit-and-miss and their ads never seemed interesting. Now, they've done what Google did: they made their ads relevant and very much part of their bigger system. I've clicked a few ads, now, because I'm seeing things that I want to click. That's a big breakthrough for Facebook.