Actually, facebook has a huge advantage in advertiser targeting due to the nature of facebook. Facebook is about who the person really is (and the ads can target that person.) Myspace, on the other hand is what everyone 'wants' to be I think. This is why facebook has a much larger attraction then myspace. Not to mention, facebook is far more professional looking.
Microsoft is really paying this out to keep Facebook away from Google. The banner ads probably won't pay for themselves, and Facebook's market cap, if it goes public, probably won't be too much over 15 Billion, anyway. It's useful to get some great demographic data, and to show AdCenter advertisers, "Hey, your ads can show on Facebook!" 15 Billion? Probably way too much, but the valuation is on potential, I suppose.
Facebook is currently working on a way to target ad's directed right at the user browsing the site (based on his / her profile settings). For instance, regardless of where I am at.. I would be really willing to click on things if the ads showed things relating to webmaster, movies, or music. When I am getting ads showing financial stuff i can't help but ignore them. Even though I am ad blind, I would be more then willing to force myself to look at them if they were more relevant to me.
I remember the days when everyone was saying there would NEVER be anything better then myspace. Facebook is taking over and its growing faster then any site. All the social networks are jumping on the developer platform bandwagoon that facebook created.
Facebook with 49 million registered users (Aug. 07) is growing at a rate of 4 million new users per month. Will it ever slow down? Is it just a trend? Or is it here to stay?
No it's not really worth that much, as others have said it's all just what Msft thinks that it is worth. And your right when have ads, targeted or not, benefited anyone?
Very inspiring story, i mean that amount in just 3 years It does have 50 million (3.5 mil in UK alone) users and gets something stupid like 150,000 new subscribers every day..hats off on that one.
Kind of reminiscent of the previous dot-com-boom. Yes, the social web (or web two-oh) has a lot going for it, and its probably neither a passing phenomena but putting such value for the user base and the sheer potential to generate income off from them is premature, even now.
It's fantastic for the owner, and the way it is growing, and if it is valued at this price now, what will it be worth when it hits 300 million registered users, which is what Microsoft are predicting in a few years.
IF they can continue teir growth and remain the number one social networking site then $15b is probably a good investment ... just think of the global advertising potential to millions, possibly 100s million of people with data on age, likes / dislikes etc. Its a marketeers dream. That said, if the competition gets their act together it could know a big slice off the valuation.
It just shows how much money can be made in this industry if you have a good idea, doesn't it? I think it's overvalued too, $15 billion for a website @_@ madness!
Yup, a marketers dream for sure. You can't get much more targetted ads on facebook. The ads are rediculously targetted (or will be when there system rolls out). That is what markers want. They dont want to show there ads to people who dont care about it.