
Facebook lost more than Tesla's market cap - skshetry
https://www.bloomberg.com/news/articles/2018-03-20/facebook-sees-tesla-sized-chunk-vanish-from-market-cap-in-2-days
======
twblalock
The stock will come back, just as Wells Fargo, United Airlines, and Intel
stock came back after their scandals.

Facebook in particular will come back because there is no alternative social
network with nearly as many people on it. The fundamentals of the business
aren't really at risk -- most of the users will stay. The impact of potential
privacy-related regulation is already priced in to a large extent because
everyone already knew that GDPR was going to happen before this latest scandal
broke, and Facebook was already prepared to comply with it. I doubt the US
Congress in its current state would pass anything as strict as that.

~~~
raiyu
It's true that many companies come back from scandal but it really depends on
the impact to the bottom line. Chipotle had tremendous negative press years
ago from food poisoning issues and hasn't recovered since. Even though the
number of instances are in the single digits compared to millions of burritos
served on a monthly basis.

With social media boycott campaigns it's hard to separate the noise from
impact on the bottom line but with recent stories of Uber and what was
occurring behind the scenes, the #DeleteUber campaign actually did have a
negative impact on the bottomline that was felt and was definitely a huge
driver for the board moving to remove Travis which is underreported as
everyone instead focuses on the drama that occurred as that sells as a better
story from the press side.

With Facebook it will really be about how many people truly delete Facebook.

The difference of course is that every Uber user was generating significantly
more revenue on average than the avg Facebook user, so the number of users
that delete Facebook would have to be much more significant.

Also interesting, is what is the global response. Is this localized to the US,
are many people globally doing the same thing?

If it doesn't impact the bottom line through a massive amount of users
deleting, then the stock will bounce back well before the next quarterly
earnings report.

~~~
spyspy
Disclosure: I bought more FB today

You covered the fundamental reason why Facebook _could_ suffer from this but I
believe it won’t. Uber is very easy to ditch because it has well-known
competitors that are just or almost as good and readily available. And uber
doesn’t have years of photos, friends and interactions that I’d be losing.

~~~
pksadiq
> Disclosure: I bought more FB today

May be you can consider the moral side of what you are doing, if you care.

This makes me really sad. People say, they care about privacy - theirs and
others'. But they are okay making money investing for the same.

~~~
twblalock
How does investing in Facebook stock help Facebook? It's not like Facebook
gets the money. The guy you buy the stock from gets the money.

You know what would do good in the world? Invest in evil companies and use the
profits to fund advocacy against what they are doing. Turn their success
against them.

But if you refuse to invest in companies you don't like, it makes no
difference to them at all.

~~~
cwilkes
It isn’t so much as “helping” a company but rather putting your money where
your mouth is and refusing to make a personal profit off a company you don’t
agree with.

~~~
twblalock
That only hurts yourself. It results in no benefit to any cause or harm to the
company you don't like.

------
panarky
Facebook isn't going to disappear, but the company's valuation has fast growth
baked in the cake.

We're already seeing dramatic deterioration in DAUs and minutes per user.

This episode will cause a few users to leave Facebook completely, but many
more will use it less.

And that deceleration in the growth rate will need to be offset with an
acceleration in earnings and cash flow for the stock price to increase from
here.

~~~
bsaul
Most people i've seen move away from facebook ended up in instagram and
whatsapp. So i'm not worried for the stock in the long term. They do however
need to prepare for the post-instragram era. Not sure what it's going to be.

~~~
pyjammas
I've been curious about what the effects are of people moving to Instagram and
WhatsApp.

I'm not too familiar with the former, but am I correct in assuming it's less
useful, compared to FB proper, for both ads and information gathering?

And with WhatsApp, if everything is indeed end-to-end encrypted, would this
not be even more the case? Instead of a steady supply of chats, photos,
location data, FB would 'only' have metadata to work with. And ads are
probably not really a realistic option at all.

Unless I'm wrong about all that, I imagine the value of these two platforms is
significantly lower than the original value of Facebook (to them, anyways)

~~~
deepbreath
The WhatsApp client could still learn your interests from your conversations
and request ads related to them from the server.

~~~
pyjammas
Isn't all that end-to-end encrypted?

~~~
deepbreath
It is, but your own _client_ obviously has access to the conversation (how
else would it display it on your screen?). So learning your interests can be
done on the client-side, rather than server-side. Then your list of interests
is reported to the server.

------
toni_erika
So, an already oversized company that has been loosing business to startups
for several years is gonna do more work in-house?

------
arthurofbabylon
A lot of commentary here (not all) seems to miss one critical point: what is
the inherent value of Facebook to its users, and has THAT been recently
degraded? Controversy aside, this will be the big factor behind an exodus from
Facebook, and I would argue that for months if not a year or more, Facebook
has ceased to provide value to an enormous portion of its user base.

~~~
gnode
If by users you mean the people with Facebook profiles, then the value to them
doesn't matter, only engagement matters, being addictive and depressing is a
winning strategy here, at least short-term. What matters is the value of
Facebook to its customers. If users lose touch with the platform, consume less
ads, and yield less data, then that will matter to Facebook.

