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Why FB's Valuation of 70 Billion Dollars is Worth It.

Discussion in 'FaceBook' started by indianbill007, Feb 28, 2011.

  1. indianbill007

    indianbill007 Jr. VIP Jr. VIP

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    Today Just browsing over the internet and doing by usual online shopping which am so much fond of, I noticed an unusual trend.

    A lot of sites these days, have started offering product discounts just to like their page or just to sign in with your facebook account and give them access to your wall's for posting notification which gets published on your stream.

    Assuming online commerce to be some billions of dollars an year, assume how much money does this discounting thing is saving customers.

    As a business model, if FB starts charging all businesses and products pages some monthly fees to engage with customers I dont think businesses would have an issue. After all this kinda social engagement gives realtime feedback and realtime market research data for improving on products.

    Not sure if the the business dev team in FB is already thinking on these lines. Seems like way to go facebook! I will buy some shares once you get public lolz.
     
  2. Monrox

    Monrox Power Member

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    Once a free online service begins to heavily commercialize its potential, it's the beginning of the end for them. Also a very fast growth usually indicates there is much room for competition that's not emerged yet but could soon. G and MS are notable exceptions because their business models are patented.

    But it will take a singe carefully crafted psychological strategy to convince the zombies called FB users that some new platform is the latest, coolest thing to be part of. Afterall, they are not stucked with something they had to pay for.

    One could simply make a FB copy, invest a milllion or so to get the 100 currently most famous celebs to create profiles on the site and interract with users 30 minutes everyday (but at random times of the day). The masses will go crazy, and FB will be finished.
     
  3. indianbill007

    indianbill007 Jr. VIP Jr. VIP

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    "Once a free online service begins to heavily commercialize its potential, it's the beginning of the end for them"

    I don't think so, by your analogy, google starting with adwords should have been an end for them? They are valued at 200 billions for the adwords system.

    "One could simply make a FB copy, invest a milllion or so to get the 100 currently most famous celebs to create profiles on the site and interract with users 30 minutes everyday (but at random times of the day). The masses will go crazy, and FB will be finished."

    I dont remember Mark Zuckerberg calling 100 celebs to make FB popular and people being crazy about it. I use FB cause I find it easy to connect with people and very simple to use, and so do the 500 million others IMHO.
     
  4. schrute

    schrute Regular Member

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    Sorry, I will definitely short Facebook shares once they IPO. There is no way Facebook is worth $40 billion let alone $70 billion.

    Facebook barely brings in $1 billion in ad revenue. A model that is grossly inefficient.

    Also, not to mention, that Goldman Sachs is involved in an offer, which makes the whole thing stink to high heaven.

    At any price, FB stinks, $20 billion, $40 or $100 billion. The CEO's reputation is for stabbing people in the back... Watch all the employee shares enter the market...
     
  5. adbox

    adbox Power Member

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    There is no way facebook will open an IPO. That would be dumb dumb dumb dumb dumb, not to mention suicide, and dumb dumb dumb dumb dumb.

    I mean. Facebook is already extended as a private company..
    The marketplace might could take flight, but they could do that without and IPO and keep the profits in house, and keep the riff raff out of house.

    Just saying there is no way. No No way.
     
  6. Aaric

    Aaric Elite Member

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    You know that professional investors average worse than the S & P average. That means you can close your eye and throw a dart and you are more likely to be a better investor than these idiots following the herd to the slaughter house.
     
  7. Monrox

    Monrox Power Member

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    Yeah but G is using something that nobody else is allowed to until ~2020: a patented system based on hyperlinks to recognize relevant content. And since it is a solid working system, there is currently no better alternative. That is why Bing places more value on other factors; they are legally not allowed to do otherwise / can't come up with a better solution.

    Whereas FB is just a clever innovation, not offering anything that others can't copy. It is like IRC back in the day. The masses discovered chatting and every PC had mIRC or some clone of it installed. But its popularity crashed when ICQ (it needed an investment) appeared which in turn got blown away by Skype & co (which also required investments).

    No user base wants to buy stuff or be flooded with ads, they want free entertainment. In theory all are potential buyers but in practice they are hardly convertible except for the usual deception tactics where you take action for a promise of a free iPad or something.

    In this regard FB is battling spammers not because they are stealing their money but because users loathe any kind commercialization attempts, in-house or otherwise. Also, a single security slip could bankrupt the company in an instant with all the uploaded personal stuff (esp. the erotic self pics).

    If Zuki is smart he should sell fast while riding the wave, like the previous owner of youtube did. YT is pretty devalued now with all the prontubes around and the hoardes of copywright lawyers waiting for a chance of their life.
     
  8. cookie48

    cookie48 Jr. VIP Jr. VIP Premium Member

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    FB doesnt have any good business model what would bring high revenues. Maybe some day they will find it, maybe not.

    Google is generating big incomes for last few years.

    Someday people may be fed up with FB and find some other online toy.
     
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  9. badinvention

    badinvention BANNED BANNED

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    I totally agree.

    "oh you're on friendster, i have a myspace"

    "oh you're on myspace, i have a facebook"

    "oh you're on facebook, i have a xxxxxxxxx"

    "oh you're on xxxxxxxxx, i have a yyyyyyy"
     
  10. Website

    Website Supreme Member

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    1985 oh i use PC

    1990 oh i use PC

    1995 oh i use PC

    2000 oh i use PC

    2005 oh i use PC

    2010 oh i use PC

    2000 oh i use Google

    2005 oh i use Google

    2010 oh i use Google
     
  11. cookie48

    cookie48 Jr. VIP Jr. VIP Premium Member

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    FB is not next PC or Google. Its more like Iphone or Ipad. Some cool toy that was launched in right time.
     
  12. rlink

    rlink Regular Member

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    FB is nothing like an ipad or Iphone, i know what you reffer to but definitelly not that. FB is the next big thing. It's a huge gathering, one of the biggest communities in the world, gathered half the population of China in one place.


    The interesting thing is the endless posibilities it offers users to communicate with each other. Imagine there are certain mobile networks that surely have gathered big numbers of customers/users but they only offer them a few ways to interact with each other.

    Unfortunatelly FB as many other things going around these days is apocalyptic .. again unfortunatelly. We are meant to be split apart to a certain extent, we were designed that way, forced gatherings or better said invoked do also have bad consequences.

    Just my thoughts :)
     
  13. schrute

    schrute Regular Member

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    Sorry, Facebook is nothing more than Myspace. Although lots of advertisers/businesses found it VERY easily to communicate with their consumers or potential consumers only because people go on Facebook on hype.

    Facebook generates no real revenue. It is a house of cards. It's CEO founded the business by backstabbing people. Goldman Sachs, who profited from the failure of many banks and people with foreclosed homes, is in the center...

    Sorry but if you believe Facebook is the next coming of Christ, you stupid...

    Facebook, if they ever IPO, is going to be the biggest scam stock in history...
     
  14. cnick79

    cnick79 Jr. VIP Jr. VIP

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    FB is only as strong as the people who is it, no doubt about that. Their value comes from the amount of user information they have. Once people slowly stop using FB that data becomes stale and less valuable. People WILL slowly stop using FB, it's only a matter of time. FB is a fad and all fads come to an end eventually.