4 ms·

I'm going to buy when it gets closer to $10 per share. Half the world uses Facebook every day so let's not pretend it isn't an awesome business with utterly ma

I'm going to buy when it gets closer to $10 per share. Half the world uses Facebook every day so let's not pretend it isn't an awesome business with utterly massive potential.

joelrunyon 14y ago
"awesome business" and "massive potential" aren't mutually exclusive events. It can have massive potential, but never deliver and still be a terrible business. Sure, it's got a lot of upside if you can buy it at the right price, but up till now, it hasn't shown advertisers (who make up the majority of their revenue) that it can deliver customers as acceptable CPAs. Until that happens, we'll still be waiting for facebook to be an "awesome business."
- grandalf 14y ago
  I don't think CPAs are the right metric. Facebook is massively engaging. I think TV is the most natural synergy b/c people socialize around it today but only in one household. Facebook should also launch a web search similar to Google just go capture some market share in search-driven advertising. Around the world, Facebook is the fastest loading website (it often beats Google). Its infrastructure is ready to make a truly global play of some kind. Expect something huge after the stock price stabilizes a bit.
  - bunderbunder 14y ago
    Perhaps CPA is not the right metric. But a bunch of hype that glosses over the fact that Facebook doesn't really actually make very much money is not the right metric, either.
    - chii 14y ago
      But i thought facebook's revenues are in the billions? Where is that money coming from?
      - joelrunyon 14y ago
        A little over 3.5 billion. I think he was saying that the revenue considering the company size and user base (almost 1 billion) is not very much.
        bunderbunder 14y ago
        Yup. Especially considering their revenue has also been falling, that there are concrete reasons to think that it will continue to do so, and that they're operating in a notoriously brutal and fickle space. There's money there, but not enough to cushion a fall.
  - nazgulnarsil 14y ago
    if TV is the model facebook should acquire synchtube.
    - samstave 14y ago
      Facebook should sponsor and create content viewing events that are only visable via facebook. What if there was a "real world FB" where FB users live together and drama ensues - and the only way to watch it is FB.com. There are so many other things that FB could do to truly be a platform: Education via FB, Work via FB (think having a mechanical turk via FB where users could sign up to be a part of the service and use the FB platform to earn money), videoconference within FB, etc etc etc.
  - joelrunyon 14y ago
    If CPAs aren't the right metric, you still need to find a better metric to convince advertisers it's worth it. And I think the "look how many users we have!" metric is going away quickly.
  - slantyyz 14y ago
    Facebook is massively engaging, but the ads they allow to appear on the site are incredibly off-putting. I personally don't mind ads on sites, but the Facebook ads that I'm fed all appear to be for slimy businesses (I'm constantly seeing ads for Canadian Pardons that are using what I believe to be unauthorized images of celebrities) or have seemingly low-to-no production values. They need to fix or curate the way ads are displayed, because I think it will eventually become a hindrance to their success.
batgaijin 14y ago
See, I hate arguments for this. How many new accounts did you create annually 10 years ago? How many new accounts did you create annually 5 years ago? How many new accounts did you create this year? People don't mind switching, and in fact they don't mind having simultaneous accounts. People on this forum think that they are 'special' inasmuch they don't mind negotiating multiple accounts with relative ease, but it's an inevitable tactic. Facebook can be used to login to other sites, but with Google+ and Twitter and the $20 share price, nobody small wants to bet on Facebook. It's like making an Xbox 360 exclusive game if there was a $0 porting cost. If Facebook is bought out by Microsoft or Apple, it will truly be a threat as a universal login system. But until then, they will die a death from a 1000 paper cuts.
- robryan 14y ago
  I see facebooks problem right now more as an inability to effective monetize their users, rather than at risk of a large set exodus any time soon. Facebook is very ingrained in what so many people and businesses do now unlike any other web service has been. You see Facebook branding on most businesses ads and physical locations. Of course it is possible to overcome these network effects but I think that if they are smart enough they can keep it going. Then it just becomes a question of what valuation they can sustain without being so invasive as to completely alienate their userbase. On an anecdotal level I have seen people try things like Path, Instagram, the location based networks etc. Most when the mental overhead of all the social networks get to much eventually just mainly settle back on Facebook (with Twitter being the only real exception)
  - chii 14y ago
    > an inability to effective monetize their users this is the problem - facebook's value proposition for a user is not Facebook itself, but the ability to interact with another person easily (games, photoshares, pokes etc). However, this isn't actually worth very much money, and to try to extract that from the user is fruitless. The only real way to monetize is really to sell behavioural data of its users to advertisers. There is real value in that, even if the users don't like it. But its a double edged sword, and this sword is what is going to kill facebook!
beagle3 14y ago
Where does the magical $10 number come from in this decision of yours?
phaus 14y ago
Facebook may stick around for years to come, but I disagree that it's an awesome business. Unless oriented towards professional profiles (like LinkedIn), social networks are a terrible idea. Just because everyone likes something, doesn't mean it it's in their best interest. Facebook is just a voluntary invasion of privacy. Right now most people are either using Facebook to post memes and soft core pornography that they find elsewhere, bitch about how their lives are more difficult than everyone else's because they have a job(try not having one for a while), or to stalk their current / former significant others. I myself prefer more direct and personal forms of communication like Skype, Instant Messaging(Facebook Chat is merely adequate), phone calls or email. Unfortunately, I am saddled with Facebook because everyone I know has abandoned all other forms of communication.

I'm going to buy when it gets closer to $10 per share. Half the world uses Facebook every day so let's not pretend it isn't an awesome business with utterly massive potential.

joelrunyon 14y ago

"awesome business" and "massive potential" aren't mutually exclusive events. It can have massive potential, but never deliver and still be a terrible business. Sure, it's got a lot of upside if you can buy it at the right price, but up till now, it hasn't shown advertisers (who make up the majority of their revenue) that it can deliver customers as acceptable CPAs. Until that happens, we'll still be waiting for facebook to be an "awesome business."

grandalf 14y ago
I don't think CPAs are the right metric. Facebook is massively engaging. I think TV is the most natural synergy b/c people socialize around it today but only in one household. Facebook should also launch a web search similar to Google just go capture some market share in search-driven advertising. Around the world, Facebook is the fastest loading website (it often beats Google). Its infrastructure is ready to make a truly global play of some kind. Expect something huge after the stock price stabilizes a bit.
- bunderbunder 14y ago
  Perhaps CPA is not the right metric. But a bunch of hype that glosses over the fact that Facebook doesn't really actually make very much money is not the right metric, either.
  - chii 14y ago
    But i thought facebook's revenues are in the billions? Where is that money coming from?
    - joelrunyon 14y ago
      A little over 3.5 billion. I think he was saying that the revenue considering the company size and user base (almost 1 billion) is not very much.
      - bunderbunder 14y ago
        Yup. Especially considering their revenue has also been falling, that there are concrete reasons to think that it will continue to do so, and that they're operating in a notoriously brutal and fickle space. There's money there, but not enough to cushion a fall.
- nazgulnarsil 14y ago
  if TV is the model facebook should acquire synchtube.
  - samstave 14y ago
    Facebook should sponsor and create content viewing events that are only visable via facebook. What if there was a "real world FB" where FB users live together and drama ensues - and the only way to watch it is FB.com. There are so many other things that FB could do to truly be a platform: Education via FB, Work via FB (think having a mechanical turk via FB where users could sign up to be a part of the service and use the FB platform to earn money), videoconference within FB, etc etc etc.
- joelrunyon 14y ago
  If CPAs aren't the right metric, you still need to find a better metric to convince advertisers it's worth it. And I think the "look how many users we have!" metric is going away quickly.
- slantyyz 14y ago
  Facebook is massively engaging, but the ads they allow to appear on the site are incredibly off-putting. I personally don't mind ads on sites, but the Facebook ads that I'm fed all appear to be for slimy businesses (I'm constantly seeing ads for Canadian Pardons that are using what I believe to be unauthorized images of celebrities) or have seemingly low-to-no production values. They need to fix or curate the way ads are displayed, because I think it will eventually become a hindrance to their success.

batgaijin 14y ago

See, I hate arguments for this. How many new accounts did you create annually 10 years ago? How many new accounts did you create annually 5 years ago? How many new accounts did you create this year? People don't mind switching, and in fact they don't mind having simultaneous accounts. People on this forum think that they are 'special' inasmuch they don't mind negotiating multiple accounts with relative ease, but it's an inevitable tactic. Facebook can be used to login to other sites, but with Google+ and Twitter and the $20 share price, nobody small wants to bet on Facebook. It's like making an Xbox 360 exclusive game if there was a $0 porting cost. If Facebook is bought out by Microsoft or Apple, it will truly be a threat as a universal login system. But until then, they will die a death from a 1000 paper cuts.

robryan 14y ago
I see facebooks problem right now more as an inability to effective monetize their users, rather than at risk of a large set exodus any time soon. Facebook is very ingrained in what so many people and businesses do now unlike any other web service has been. You see Facebook branding on most businesses ads and physical locations. Of course it is possible to overcome these network effects but I think that if they are smart enough they can keep it going. Then it just becomes a question of what valuation they can sustain without being so invasive as to completely alienate their userbase. On an anecdotal level I have seen people try things like Path, Instagram, the location based networks etc. Most when the mental overhead of all the social networks get to much eventually just mainly settle back on Facebook (with Twitter being the only real exception)
- chii 14y ago
  > an inability to effective monetize their users this is the problem - facebook's value proposition for a user is not Facebook itself, but the ability to interact with another person easily (games, photoshares, pokes etc). However, this isn't actually worth very much money, and to try to extract that from the user is fruitless. The only real way to monetize is really to sell behavioural data of its users to advertisers. There is real value in that, even if the users don't like it. But its a double edged sword, and this sword is what is going to kill facebook!

beagle3 14y ago

Where does the magical $10 number come from in this decision of yours?

phaus 14y ago

Facebook may stick around for years to come, but I disagree that it's an awesome business. Unless oriented towards professional profiles (like LinkedIn), social networks are a terrible idea. Just because everyone likes something, doesn't mean it it's in their best interest. Facebook is just a voluntary invasion of privacy. Right now most people are either using Facebook to post memes and soft core pornography that they find elsewhere, bitch about how their lives are more difficult than everyone else's because they have a job(try not having one for a while), or to stalk their current / former significant others. I myself prefer more direct and personal forms of communication like Skype, Instant Messaging(Facebook Chat is merely adequate), phone calls or email. Unfortunately, I am saddled with Facebook because everyone I know has abandoned all other forms of communication.