

Alexa ranks Facebook #2 website worldwide (Google #1, Yahoo #3) - jacquesm
http://www.alexa.com/siteinfo/facebook.com

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tokenadult
That sounds about right, based on my usage. I understand how Google makes
money from its users, and I've heard about Yahoo's struggles to make money
from its users, but I'm still puzzled how Facebook makes money from its users.
(I visit Facebook with AdBlock and Facebook Purity on, so I generally don't
see Facebook ads, which I remember as very schlocky from when I could still
see them.)

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mattmaroon
They really don't yet. They have more traffic than yahoo but somewhere between
5-10% the revenues. There are a lot of theories as to how they will make
money, but those schlocky ads you saw will at most be a small portion of it if
they ever hit Google-sized revenues.

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tokenadult
And of course profit is related to earnings more than just to revenue. It's
not clear to me that Facebook's services are inexpensive enough to run and
compelling enough to users over the long term to build a profitable business.

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mattmaroon
That's part of the problem. Even in web services, a 90% profit margin is
unrealistic. So if you're doing the same volume as Google (operating margin of
around 30%) but making only 5% RPU, you're probably not profiting much.

That's a lot of why Facebook is only barely profitable, whereas Google was
making a killing when it had their traffic levels.

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eserorg
It would be interesting to see the top 100 sites ranked by gross-profit by
user.

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mattmaroon
It'd be 100 sites you never heard of before.

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jacquesm
And 'gross' would probably be quite apt.

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mattmaroon
I don't think so. Pretty sure the best porn sites (assuming that's what you
meant) have monthly RPU of like $30ish, and profit margins much lower due to
lots of affiliate payouts, high churn, tremendous charge back rates, etc.
Their industry, like gambling, is such that RPU is probably a useless metric I
suppose.

There are lots of small businesses out there making total assloads of money
that you never hear of because they do something like sell truck parts or
specialty electronics. They buy their traffic off of Adwords, get ridiculous
conversion rates, and average sales of $100+.

Party Poker used to make something like $1,000 per customer. So there'd be a
ton of online poker/casino sties perhaps.

