5 ms·

In my mind, Facebook's value is 0 until it can demonstrate profitability. This whole idea of it not being big enough yet is asinine.

eru 18y ago
Facebook can be made profitable right now: Just display lots of ads on it and sell all its (user) data. I guess the side would not last long with this approach, but it would make a few dollars in the next days.
- tom_rath 18y ago
  Who would buy those ads? That seems to be Facebook's problem. The 'platform' seems to be dominated by idle people who prefer free services that let them spend their day throwing virtual sheep at each other. That's not a particularly valuable demographic for businesses seeking to advertise their wares. Much better, by far, to purchase targeted advertising on Google.
  - jwesley 18y ago
    There is millions of dollar being made every day with Facebook ads. You can target them very specifically and drive large amounts of traffic cheaply. No, it is certainly not Adwords. For some offers it doesn't work. For some it works better than search. Just because it's not search does not mean it's not an incredibly valuable marketing channel. They will never be as profitable as Google because the CTR of the ads is pathetically low (compared to search) and the clicks are much less valuable, but there is massive traffic there. Even if they never develop the killer ad product there is still a big business there.
shawndrost 18y ago
Facebook made ~$200mm in 2008. It's pretty clear they could profit on those revenues, and instead are choosing to invest in further growth (with outside capital). Why is the parent comment's belief so widespread here on hn?
- deleted 18y ago
  [deleted]
- alaskamiller 18y ago
  Because snarking on Facebook is fun! My belief is that with straight up direct ad sales and limited targeting ads, MySpace cleared $1B this year. That's the potential upper limit of how much Facebook can make with just straight up ad sales. But having a much more complete understanding of relationships, Facebook wants to find something more effective and profitable than AdSense. That's what Mark Zuckerberg really pitched to everyone that has invested into Facebook: his team's ability to reinvent online advertising. The products they have so far -- Beacon, Social Ads -- are kind of lame but Facebook Connect is getting pretty big and they have quite a lot of money and time to work on it. But all this doesn't matter. Facebook isn't profitable! And somehow this affects hackers around the world.
  - incomethax 18y ago
    Of course this would affect hackers around the world. Anything that Google, Microsoft, Apple, etc. affects hackers because so many hackers are employed by these companies. Facebook is the same way, the churn of ideas that goes through each of these companies matters because only through working with other hackers do hackers develop and refine their own ideas. Without these large companies subsidizing hacker side projects we wouldn't get any of the idea building that spins into new companies and growth for our economy.
    - alaskamiller 18y ago
      Facebook is more of a kids paradise than hackers paradise.
  - gnaritas 18y ago
    > cleared $1B this year I doubt that, cleared tends to means profit, not revenue, how much did they actually make after all the expenses were paid?
- run4yourlives 18y ago

eru 18y ago

Facebook can be made profitable right now: Just display lots of ads on it and sell all its (user) data. I guess the side would not last long with this approach, but it would make a few dollars in the next days.

tom_rath 18y ago
Who would buy those ads? That seems to be Facebook's problem. The 'platform' seems to be dominated by idle people who prefer free services that let them spend their day throwing virtual sheep at each other. That's not a particularly valuable demographic for businesses seeking to advertise their wares. Much better, by far, to purchase targeted advertising on Google.
- jwesley 18y ago
  There is millions of dollar being made every day with Facebook ads. You can target them very specifically and drive large amounts of traffic cheaply. No, it is certainly not Adwords. For some offers it doesn't work. For some it works better than search. Just because it's not search does not mean it's not an incredibly valuable marketing channel. They will never be as profitable as Google because the CTR of the ads is pathetically low (compared to search) and the clicks are much less valuable, but there is massive traffic there. Even if they never develop the killer ad product there is still a big business there.

shawndrost 18y ago

Facebook made ~$200mm in 2008. It's pretty clear they could profit on those revenues, and instead are choosing to invest in further growth (with outside capital). Why is the parent comment's belief so widespread here on hn?

deleted 18y ago
[deleted]
alaskamiller 18y ago
Because snarking on Facebook is fun! My belief is that with straight up direct ad sales and limited targeting ads, MySpace cleared $1B this year. That's the potential upper limit of how much Facebook can make with just straight up ad sales. But having a much more complete understanding of relationships, Facebook wants to find something more effective and profitable than AdSense. That's what Mark Zuckerberg really pitched to everyone that has invested into Facebook: his team's ability to reinvent online advertising. The products they have so far -- Beacon, Social Ads -- are kind of lame but Facebook Connect is getting pretty big and they have quite a lot of money and time to work on it. But all this doesn't matter. Facebook isn't profitable! And somehow this affects hackers around the world.
- incomethax 18y ago
  Of course this would affect hackers around the world. Anything that Google, Microsoft, Apple, etc. affects hackers because so many hackers are employed by these companies. Facebook is the same way, the churn of ideas that goes through each of these companies matters because only through working with other hackers do hackers develop and refine their own ideas. Without these large companies subsidizing hacker side projects we wouldn't get any of the idea building that spins into new companies and growth for our economy.
  - alaskamiller 18y ago
    Facebook is more of a kids paradise than hackers paradise.
- gnaritas 18y ago
  > cleared $1B this year I doubt that, cleared tends to means profit, not revenue, how much did they actually make after all the expenses were paid?
run4yourlives 18y ago