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Dark Days Ahead For Facebook and Google? 215

Posted by timothy
from the feel-free-to-send-me-your-discarded-shares dept.
An anonymous reader writes "Dallas Mavericks owner and media entrepreneur Mark Cuban thinks he knows the reason for Facebook's disappointing IPO; smart money has realized that 'mobile is going to crush Facebook', as the world's population increasingly accesses the Internet mostly through smartphones and tablets. Cuban notes that the limited screen real estate hampers the branding and ad placement that Google and Facebook are accustomed to when serving to desktop browsers, while phone plans typically have strict data limits, so subscribers won't necessarily take kindly to YouTube or other video ads. Forbes' Eric Jackson likewise sees a generational shift to mobile that will produce a new set of winners at the expense of Facebook and Google."
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Dark Days Ahead For Facebook and Google?

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  • by Sir_Sri (199544) on Friday May 25, 2012 @07:17PM (#40115415)

    Or maybe the facebook guys did a really good job of getting the maximum value for their previous investors.

    If you guess the value of a company as 110 billion dollars, and it turns out it's actually 95 that's a lot closer to reality than if you guess 20 and find out it's really 160. If you look at google, that opened at around 90 immediately jumped to 110 ish, then dropped to 100 not too long after, the next major local minimum is 243, which comes 3 years later, and it's now around 600. Feel free to pick your own preference for what counts as the 'correct' value of google stock, but pretty clearly the answer has been a hell of a lot more than 100 dollars a share for the last 7 years.

    The point of the IPO was in part to get cash so they can build and capitalize on new ideas. I have no idea what those ideas are, but then I wouldn't have anticipated amazon's cloud service (and I have a close person friend who works on it, and was working on developing it). Facebook bought themselves time, with cash, both to get regulators off their back (fairly, you can't have that many shareholders and not be public for long) and to invest in and build new revenue streams. Again, no idea what those are. Mark Cuban clearly doesn't see them either, and he's presumably more credible on the topic than I am, but that doesn't mean Zuck is without a plan to make more money.

    Of course you're right, the whole thing could be hype or stupidity. Zuckerberg might be a naive idealist who's happy to never pay a cent to shareholders and run Facebook like a charity with enough revenue to keep everyone paid and then nothing else. That would be a disaster for facebook stock in the not too distant future, but he does have a chance to make it into a proper greedy profit building enterprise, rather than just an invasive leech on your privacy.

  • Re:But (Score:5, Interesting)

    by TheEyes (1686556) on Friday May 25, 2012 @07:50PM (#40115809)

    I think that was their plan, but they can't now because they own Motorola. One of the US FCC's big firewalls (the only one, it seems, that they care to enforce anymore) is that a carrier cannot manufacture their own phones, essentially to prevent the kind of massive fail we saw in the 70s with AT&T.

    As far as I can tell, Google's plan was to buy up massive amounts of darknet (already done), set themselves up as an ISP (pilot project in Topeka), and gobble up enough spectrum to make themselves a big player in mobile internet (T-mobile would make a good buy, and DT wants to sell). Unfortunately for us, the patent wars forced Google to look for a defensive portfolio, and Motorola leveraged their portfolio into forcing Google to buy them to get their patents (or else they'd all go to Microsoft/Apple; Motorola essentially held themselves hostage), so that dream is dead for now.

    It may be possible for Google to spin the remains of Motorola back off as a separate manufacturer; they certainly don't seem very enamoured with the company, seeing as they're keeping the two businesses entirely separate in terms of management and workers, and aren't really even collaborating with them when making the new version of Android. Maybe they'll just shuck off the phone maker part of Motorola Mobility and continue on their grand plan; they've certainly got the free cash to pull something crazy like that.

  • by AngryDeuce (2205124) on Friday May 25, 2012 @08:24PM (#40116093)

    I'm curious what exactly makes a user "active". I know so many people with Facebook accounts that abandoned them ages ago...they didn't go through the bullshit hassle of deleting the account, but they stopped logging in.

    This is one of the reasons why I really wondered about Facebook's valuation being accurate or not. I know for a fact that I had multiple accounts (before I deleted them), so to FB, I was 3 separate people (work, play, and politics). I know many other people that have a work account and a personal account to keep their private lives private.

    Based upon my own off-the-cuff observations in my circle of friends and family (obviously not scientific, but just for the sake of estimation) I would guess that 2/3, maybe 3/4, of the active users are actually real, individual people. When you're talking about 900 million "active users", that's 225-300 million bogus, worthless accounts. How would an advertiser know that they were targeting ads at real people and not an alternate account? How would they know that all their "likes" were legitimate potential customers and not someone just fucking around on a throwaway account they don't care about?

    The mobile customers are probably legitimate, I'll grant that, because most people aren't going to tie a troll account to their mobile device. But that still leaves 450 million accounts that are very questionable in my opinion.

    I know Facebook would never really release numbers on the numbers of people that have abandoned their service or the number of potentially duplicate/troll accounts because it's just negative publicity with no positive gain for FB in doing so, but it would be nice to know if I'm completely off my rocker or if I just happen to know an inordinate number of people that have multiple accounts.

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