Somebody please help me understand
Dec. 29th, 2010 11:09 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
ksmith...why Facebook is considered to be worth $42 billion?
Facebook's latest valuation, according to trading on SharesPost Inc., an online marketplace that trades in shares of private companies, is greater than that for Internet giants EBay Inc. or Yahoo Inc.
"Over the years people have paid premiums for the companies best positioned for long-term growth and margin expansion. For good reason, Facebook is perceived of as one of those companies," Standard & Poor's analyst Scott Kessler said. "Whether or not at this point in its life cycle it deserves to demand a valuation that essentially makes it the second- or third-most valuable Internet company on the planet is an open question."
I understand that companies use Facebook as an advertising site, a way to hook up with potential and current customers. Writers, musicians, etc use it as a way to connect with fans and promote themselves. A lot of people use Facebook. Is that what makes it worth $42 billion? Has anyone tried to estimate total business earnings as a result of presence on Facebook, assuming that's even possible?
So far, I have friended/fanned pages of some companies I already have done business with. Sometimes I click through newspaper or magazine links that interest me. Is that where the worth comes in?
Facebook's latest valuation, according to trading on SharesPost Inc., an online marketplace that trades in shares of private companies, is greater than that for Internet giants EBay Inc. or Yahoo Inc.
"Over the years people have paid premiums for the companies best positioned for long-term growth and margin expansion. For good reason, Facebook is perceived of as one of those companies," Standard & Poor's analyst Scott Kessler said. "Whether or not at this point in its life cycle it deserves to demand a valuation that essentially makes it the second- or third-most valuable Internet company on the planet is an open question."
I understand that companies use Facebook as an advertising site, a way to hook up with potential and current customers. Writers, musicians, etc use it as a way to connect with fans and promote themselves. A lot of people use Facebook. Is that what makes it worth $42 billion? Has anyone tried to estimate total business earnings as a result of presence on Facebook, assuming that's even possible?
So far, I have friended/fanned pages of some companies I already have done business with. Sometimes I click through newspaper or magazine links that interest me. Is that where the worth comes in?
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no subject
Date: 2010-12-30 02:14 pm (UTC)Facebook has also succeeded at inveigling itself into much more of the online world, in a more meaningful way. There are dozens of websites I go to now that have information on them about who I know that liked or recommended particular pages and such. Facebook is, or at least wants to be, an online hub. Kind of like AOL for the 2010s.
The problem, of course, is whether or not that's a gain that they can hold onto. I know some folks who go to Facebook on a regular basis, but it seems it's already waned and passed on for the technorati. The question is whether the technorati are still going to blaze trails and keep opening the next new thing, or whether the profitable majority (which is what that $42bn is based on) is going to stand pat on FB and Farmville and such, and camp there for a generation.