SOCIAL MEDIA

What is Facebook?

Facebook is a social networking service and website launched in February 2004, owned and operated by Facebook, Inc.  As of May 2012^[update], Facebook has over 900 million active users, more than half of them using mobile devices.  Users must register before using the site, after which they may create a personal profile, add other users as friends, and exchange messages, including automatic notifications when they update their profile. Additionally, users may join common-interest user groups, organized by workplace, school or college, or other characteristics, and categorize their friends into lists such as "People From Work" or "Close Friends". The name of the service stems from the colloquial name for the book given to students at the start of the academic year by some university administrations in the United States to help students get to know each other.

On May 18, 2012 Facebook started selling stock on the NASDAQ at a price of $38/share making it the third largest IPO in history, behind VISA (#1) and ENEL SpA (#2) but ahead of General Motors, AT &T Wireless, Kraft Foods, France Telecom, and Swisscom just to name a few; however, Facebook is the only one to be listed on NASDAQ, as all the rest were listed on NYSE. 

Facebook could not hold its original IPO price and it has fallen 32% in its price per share, reducing its original market capitalization from $104 Billion down to a little over $17 Billion.  Some say that Facebook

stock is only worth $7.50 not at 100 times earnings as it was originally priced by Morgan Stanely.  Apple and Google priced their IPOs at 15 times earnings and today they are trading at 13 and 18 times earnings respectively.

What is the future for Facebook? 

Zuckerberg, Facebook’s CEO, at 26 years old says,

“our goal is to make everything social.”  Continuing, “If you look five years out, every industry is going to be rethought in a social way. . .  You can remake whole industries. That’s the big thing.”  Read entire article

On the other side of the coin there is a concern:

As social marketers, real estate professionals walk a tightrope of personal/professional transparency. Many have used their personal Facebook accounts to cast a wide net in building their sphere of influence. This is not the way Facebook envisions the best use of their platform. Facebook wants personal profiles to be more and more personal.

And this:

Well aware of the revenue not coming in from Facebook’s mobile app, the company recently revealed that mobile advertising would, in fact, be part of its long-term money-making strategy. The problem with mobile advertising is two-fold. First, Facebook has to find a way not to annoy those, roughly, 422 million users who currently access the network’s mobile app. Second, Facebook must manage to entice advertisers in order to gain mobile advertising dollars.

At the very least, Facebook’s IPO has created a bevy of new millionaires and college dropouts dreaming of becoming one.