

Facebook Versus Google Circa 2004 - atularora
http://blogs.wsj.com/digits/2011/01/06/facebook-versus-google-circa-2004/

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jamesaguilar
This is so dumb it's almost offensive. All companies don't peak in their
performance at the same time. Look at one seven year old company and another.
If their numbers are the same at that moment, what odds would you place on
their numbers still being the same (+-10%) ten years later? Me, I don't put
much money on that at all.

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erikstarck
Of course you can't compare them directly but I thought it was interesting to
see the numbers behind Google's valuation.

Based on these numbers, if you think Facebook is overvalued today you sort of
have to make the same conclusion about Google in 2004.

In fact, Facebook has even higher profit than Google did when it was valued
the same.

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mda
In 2003, total internet advertising revenue was 1/3 of 2009's. Also adjust for
inflation and look at the picture again.

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erikstarck
Well, we're still at the very early stages of social media on the web. As
someone else points out in another comment: owning the complete social graph
may very well be the most valuable asset ever. I think the potential market
for Facebook can grow much more than just 3 times over the next 7 years.

Inflation has been low the last decade, but sure, that affects the numbers.

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DuncanIdaho
Social media is a nonexistant. It's something somebody at Facebook (or
Twitter) dreamed up to hype and justify existence.

From henceforth I declare this movemenet DuncanIdahia - you may not have heard
of us - but we're growing tremendously (we grew infinitely from 5 minutes ago
to now).

Whatever.

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randomtoken
One of the WSJ staffers who writes for that blog and a lot of their tech
pieces, Jessica Vascellaro, dates Sam Lessin. He was in Mark's frat and just
sold his company to Facebook.

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BvS
Facebook has stated repeatedly that it is focussing on growth, not on
monetisation. If they are able to revolutionize banner ads by using the social
graph outside of their own territory they might be able to earn even more than
google does (imagine the increase of CPM for news, video etc. if everyone is
shown ads accordings to their interests). Besides the Internet is still
growing fast with the regard to the number of users (especially
internationally) and the time of usage (think of smartphones and tablets).

Of course it is possible that they mess it up but the success of Google in
2004 was also far from certain.

With a pe only about 30% - 40% above that of Amazon I don't think that the
valuation is that absurd.

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mda
They should have put a graph of internet users and total on-line ad revenue
comparing 2003 and 2010.

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rorrr
Facebook growth is about to end though. Most of the people who could've joined
facebook, have done so.

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frisco
Evidence to support this claim? Facebook has around 600 million active users
today, giving them several billion more prospects. Their core product, the
graph of human relationships, might very well be the single most valuable
business product _ever_.

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notahacker
Several billion more? There are an estimated 2 billion internet users, and of
those not using Facebook, a significant proportion of those are in countries
that ban their population from accessing it.

Facebook might have plenty of scope for revenue generation, but their actual
number of pageviews and users can't grow much more without them actually
_being_ the internet for the average person

