They are supposed to file their prospectus tomorrow but pricing and the actual IPO won't be for a few months.

Xon... You don't realize that Facebook became popular because they were giving people what they demand- whereas their competitors did not. Facebook's not the next flash in the pan, it's the first mainstay.

Now that Facebook attracts all the top developers and clients, they have created enormous barriers to entry. So....

Facebook isn't the next Google, it's the next Wal-Mart. (and that defo means you're right about the plateau action) The gambool is whether or not it's properly valued. $100 per customer over 8 years doesn't seem too far off the # to me.

The biggest threat to facebook is that kids don't want to be on the same site as their parents. I think you are already seeing a slight move just to avoid parents. Not that the kids are high value customers now, but perhaps later they will be. But maybe by then, they won't mind having their parents as friends.

Huh?

Yahoo?

where does it derive its revenues from ? i read ad revenue is a big earner for them, but for how long ? has anyone here ever clicked and bought something off a facebook ad?

There were a **** load of search engines pre-Google but none of them had algorithms for ordering relevant pages the way Google did. It really was a game changer.

That being said I don't see Facebook as being like MySpace or Friendster. Both of those platforms pre-dated the shift to social media based internet so they never reached the critical mass that Facebook has. I can't see Facebook being replaced unless it either does something insanely retarded or Google takes them out.

of course ad revenue...most stuff online is ad based income (ie. the site you are on right now)

never have clicked but then again i never do on google either and we know that story

I think MSN messenger is gonna make a roaring comeback and take back what's theirs!

Google+ may be a contender long-term, but mostly if Facebook drops the ball *and* Google does everything 100% right. No matter how big Google is, Facebook is too insanely huge for anything to topple it in a short to medium timespan, the critical mass is just way too big, unprecedented.

Moreover, Facebook is a top-notch product that keeps users engaged more than any other site. FB is smart, they measure everything, they know what works, and they are constantly tweaking the site and keeping up with how users are behaving.

In my opinion, the reason that FB is so huge is that it has done everything 100% right from the beginning to maximize user engagement, and I mean literally 100%, not 99%, not 99.5%. This is how they have built the biggest social networking site in history by orders of magnitude, it's not just a coincidence. For someone to seriously challenge them, that site has to do everything 100% right *AND* Facebook has to drop the ball bigtime from a product standpoint, which they have never even hinted at doing.

(and yes I know everytime they change anything some amount of ppl complain, but it's just idle chatter, many more people silently spend more time on the site because of the changes)

BTW I like Google+, it has some cool stuff (basically the Circles idea - which FB could incorporate in a heartbeat if they wanted), but it just has so far to go to gain any true traction.

Google put out a good product that is intended to compete with the greatest, most engaging website the internet has ever seen. It's like if GE or someone decided to take on Coke: Yeah, GE is a huge company, and can put a ton of research into coming up with a good cola, but people don't care, people love Coke, people have no problem with Coke, people are not looking for an alternative to Coke. Same with Facebook, imo.

Totally, both Friendster and Myspace did tons of things wrong, didn't appeal to as wide an audience, and also were just a weeee bit too early to get the ENTIRE population involved.

Making even a tiny mistake that lessens engagement in any group of potential users is so dangerous with social networking sites. Because of the extremely fast, exponential growth patterns of these sites, if you take two sites today with a fast growth rate, have one appeal to 100/100 people, and one appeal to 95/100 people, the compounding effect of their userbases doubling superfast *PLUS* the all-important network effect, will give one of the sites an enormous lead within a relatively short period of time.

I don't understand this valuation at all ($80-100B).

Although there are other ways FB is looking into monetizing their business beyond ad revenue(i.e. ecommerce), I think that when we finally get to see the financials the revenues will pale in comparison to the valuation.

When I've heard analysts talk about the valuation based on future cash flows they are based on some very favorable assumptions regarding market growth that aren't backed up with strong evidence/support because the industry is still nascent.

None of this will stop people from growing the bubble....but it will pop

Sources are saying facebooks’s 2011 revenue was $3.8B, operating profit around $1.5B. So that means its currently trading at a P/E of ~57. Not crazy, but not a good buy either.

As for Facebook's longterm outlook, I am skeptical to say the least. Facebook user numbers in the US (and most first world countries) is either slowing, plateaued, or dropping (like the US). Given that, the US and first world countries will be where most of their revenue comes from. If their user base has already peaked, it is going to need to find ways to monetize an existing user base that:

1. For most intents and purposes are blind to the existing display Ads.
2. Would be very vocal about changes to the design that involve showing more ads.
3. Social networks are not the best place to advertise. People are rarely looking for something particular when they are on Facebook vs Google.

All this added together makes me skeptical about their longer term revenue potential. Add to that the existence of Google+, which despite all of the techblogger hate, is the fastest growing service *EVER*. Whether it will be a worth competitor to Facebook is yet to be seen, but we will know for sure by the end of this year. Take Twitter for example. It's considered the 2nd most "popular" social network, yet only has ~$150 million in revenue in 2011. The bottom line, its very difficult to monetize social networks and its going to be all uphill for Facebook. At least LinkedIn has a business model around recruiters/referrals that makes sense.

Finally, my opinion is that over the next 2-3 years, people will get tired of Facebook and the "oversharing" that it causes. In addition, a lot of college kids are starting to realize the negative impact it is having on their future ... not only in terms of time wasted, but also leaving around tracks that can have a negative effect on their future employment. The whole not wanting to be on the same social network as their parents (or other annoying characters) is also a big deal that shouldn't be ignored.

so in your other post, you claimed fb was unstoppable, then in this post the bolded is why they can be jettisoned overnight.

If the users don't want, they aren't locked into a contract, or even a social one. they have their own list of people to interact with, and with the tech at their disposal, all it takes is ONE text message, and poof, no need to even log out.