I appreciate the jest of your comment, but I think it's a bit disingenuous to dismiss the 1 billion number because a small fraction of users may have multiple accounts.
Because let's be fair: Facebook is one of the very few companies that announces active users, with a fairly clear definition of what they mean by "active". At this point they're likely to have more accounts (including unused ones) than there are people alive so it would be silly now, but they've virtually always used the active metric.
>"Your declarative statements unencumbered by any research are fascinating"
Worked for a social gaming company, investigated this exact problem ("How many of our DAUs are multiple accounts?"). For our game, which had mechanics that encouraged player-to-player commerce, the number of these fake accounts was huge: around 40% on DAUs of ~150k. It was clear to me and my co-workers that this was a big issue, everywhere. But everyone in the space benefits from saying "1 BILLION USERS!" when you are selling ad reach. Except for those actually buying ads. Oops.
Moved on to different things, shorted ZNGA in April after the OMGPOP acquisition, having been privy to this scheme. Have made a decent return, covering at ~$5, but missed the last two big drops. I'm not particularly concerned what you choose to believe, because my view has worked out pretty well for me.
Wouldn't it be great if there were an MAU attack against Facebook where a group built a system to create billions of active accounts to the point where the MAU number was greater than the computing population of earth?
There are 7 billion people on earth, there are 2.3 billion with Internet access as of 2011 - FB claims that 40-ish% of Internet users are monthly actives, which is clearly BS, so you don't need to get it anywhere near 8 billion. You simply need to get it near or above actual Internet access capable people.
I call bull. Spam accounts are rampant. Based on my personal experience, people are beginning to leave. Roughly 20% of my personal friends have left in the last 6 months for varying reasons. I know I am one datapoint, but without hard statistics from FB servers it's the best I have.
Survey numbers certainly support the "facebook is full of shit" idea. There was a post recently where someone did a poll with google consumer surveys and found only 42% of US internet users have a facebook account:
I'm not sure why you would suggest comparing it to cable, I can't imagine up any way that could make a reasonable or useful analogy. It may well be an impressive number, but nobody asked if it was impressive, they asked if facebook lies about their numbers.
TV advertisers are restricted to one way flow of information, so advertising is about building brand. It's difficult to convert this into conversions. On-line advertising however have accurate statistics because of the available analytical software. Advertisers stick to conversions only as it's still a wild west when it comes to accurate impressions (even Facebook has been caught cheating on viewer counts). Until advertisers cater to surfers the full potential of on-line advertising won't be realised.
I assume it's what caused the shortfall in Google IO's graph, I personally feel on-line marketing understated as a medium.
And facebook is not the internet or television, which is why it doesn't make any sense as an analogy. Comparing how many TV viewers MTV gets to how many internet users facebook gets would be a reasonable analogy. Comparing how many internet users facebook gets to how many people have cable is nonsensical.
In my opinion, if you are sitting on a marketing budget for a retail product trying to make decisions, they are important facts to have.
I would say that knowing the absolute reach of as many channels as possible is important including billboards etc. If you expect a 0.5% conversion rate, as long as you filter out ones that reach less than a million people a week, all of your options represent a serious return.
That doesn't make a senseless analogy any less senseless. I didn't say "you shouldn't talk about how many users facebook has", in fact I talked about how many they have. I said that the analogy he made doesn't make any sense. Facebook isn't comparable to cable, it is comparable to a channel.
Back in 2008, I created some accounts for fun to see how Facebook worked, began sending out random requests first day to 4-5 people, next day to 4,5 people. On the third day I had more than 40 friends and was in a circle in some other country and people began writing on my wall asking how I am. Lame.
Yes I do, have to keep up with my friends. Sometimes I post pictures from the other accounts, but not very often, just enough to seem legit. Facebook has detected that one of the accounts may be false, and has warned me about it, thats why I began posting and sharing stuff so their bull-detecting-system wouldnt go off. It hasnt so far.
Or rather, how many people are permanently logged in but never actually post anything on FB? For all we know, you might count as an active user if you so much as visit a third-party web page with some FB trackers on it.
Actually, I think the scale is precisely what makes the number seem so low to me. It's a damned hard accomplishment to grow to 900M users while only picking up 80M fakes along the way.
80M is a large number, sure. But there are probably sites and services with 100M supposed users that have 80M fakes (some dating sites come to mind, as did MySpace in its prime). And I'm probably only exaggerating a tiny bit.
So you're saying you honestly believe that how many Facebook users has is not important to Facebook investors?
Or are you just taking a valid question that was asked, "will they have to disclose their counting methods", and trying to start a philosophical argument about how to value companies? Because it looks like that's what you're doing.
The number of users implies that if they have more users, they will be able to generate more revenue. I'm stating i don't know what their future plans for revenue generation are but, in the end, that's all that's gonna matter.
I remember reading that Facebook counts anyone who clicks a like button on any website as being an active user which is certainly b.s. If you can't serve someone an ad (and that's your primary revenue stream), they aren't an active user.
Plus, they almost certainly count public page views to Facebook (like the link above), which means every new non-logged in session gets counted as a new user. It is totally valid in my opinion to count these, but they are hyper-inflationary.
It is deceiving when using it as a metric to sell more ads. Yes, people may be liking stuff, but you can like thousands of things a day and not even open the facebook page, thus not seeing any ads. If they were able to break down like clicks based on whether somebody is on the site or not, that would be a more honest approach (not sure if they do this or not already) as you can see if marketing dollars spent there would be worth it. If many people are liking stuff that is related to your product/market but never go to Facebook.com to see ads, then why waste the money?
If I'm not mistaken, you buy ads on a cost-per-click or a cost-per-thousand-views basis. In other words, you only pay when people see or click your ad. You also choose exactly what audience you'd like to target on FB -- very few companies are rich enough and broad enough that they want to target the entire FB userbase.
Long-story short, Facebook's total monthly active user count is largely irrelevant to individuals purchasing ads.
You don't need to have more views or clicks. If you claim you have 2 or 3x the number of monthlies, you charge more per click or view. You'll attract more advertisers to your site which further drives up the cost of each advertisement.
In this way, inflating monthlies has a direct effect on ad revenue.
Yes they do. The post you are replying to even explained that. If you tell the world "we have a billion users", more companies will decide to purchase advertising on your site than if you tell the truth and say "we have 400 million users". More advertisers competing for the same number of page views means they drive the price per view up, just as any other increase in demand without an increase in supply will drive up prices.
But a user is consciously clicking the like button on a website and I believe this is a good indication that they are active. At some point the user is bound to visit facebook because and that's when you can serve the ad.
One user doing nothing but liking random pages still benefits Facebook. If you have friends that never go to facebook.com, but still click the Like button on pages they visit, that still gives Facebook a better opportunity to tailor social advertisements to you, based on what your friends like.
The next 1 billion will be really challenging, there are developing countries like Africa, countries where there are conflicts like Afghanistan, and countries like Myanmar where corruptions are really high, where infrastructure such as internet and telcoms are still treated as luxury products, if they can enter those barriers, the impact will be really big. Nevertheless, I salute Mark for getting this far.
I've got quite a few friends in Zimbabawe and Tanzania that I talk with regularly on Facebook. and just last night we were talking about Myanmar connections who had added us. When I was traveling everybody wanted to link up on FB. One friend lives in Harare's ghetto Mbare and he mainly uses his mobile to post. And many many people use internet cafes all over the world if they don't have a computer.
And here's another vision for you: I was on the border of Zambia/Zimbabwe which is a refugee camp (known locally as Baghdad). This little 6 year old girl was running around playing in the back alley and she had a toy cell phone that she was pretending to talk into (sauntering and throwing her hair so I would notice). What do you think she's going to buy as soon as she can ? For many people its the first luxury they buy. Its communication, its their future.
This astronomical user-base begs the question: why aren't you the most profitable company on the planet right now? You have the users, the money, the connections and the engineering talent. So what's the problem?
>You have the users, the money, the connections and the engineering talent. So what's the problem?
Assuming you're looking beyond the simple answer (because they 're not selling a product/service the majority of their user-base will purchase), I'd say they suffer from the lack of agility. Facebook's size increases their effort to implement even the simplest of changes. We've seen how fickle those users are about little changes and future ones could affect the group in negative and unintended ways. I'm sure every change is examined to death before implementation. In contrast, a start-up making changes might lose their early adopters, but could gain orders of magnitude more users because of that change. Facebook, however, already has the user-base. Facebook needs to keep them happy and drastically changing things in the name of profit would probably send people running. Of course not everyone will run and profit might increase, but those changes would have to be time consuming just from an implementation standpoint given their size and now being publicly traded the desire to keep the investors happy.
Good point about the lack of agility. Internal politics probably have a negative impact as well. I could see some team's feature going live for 1% of users then managers and other internal stake holders endlessly arguing about the measurements, data etc.
I think it's more likely to show that Facebook's growth has been faster than in 2006. People who just started using the site obviously have less friends in general than people who have been for awhile.
Maybe people have reached what could be considered their 'critical mass' in respect to the number of friends.
You can realistically only know a small number of people, and 300 is probably a good estimate for acquaintances rather than friends, over time you add people, remove people, fall out with people etc.
In the first few weeks you add more people than ever, then the curve slows down to 'old' and 'new' friends, in which case the trend slows down as all the people you used to know have added you.
I know that now, 5 years in to my use of an account, I delete more 'friends' than I add.
Not because of privacy concerns, mind you, I just realize now that a lot of the people I added in the early days weren't 'friends', they were just 'people' with whom I had some intangibly vague connection.
"Dunbar's number is a suggested cognitive limit to the number of people with whom one can maintain stable social relationships. These are relationships in which an individual knows who each person is, and how each person relates to every other person. Proponents assert that numbers larger than this generally require more restrictive rules, laws, and enforced norms to maintain a stable, cohesive group. No precise value has been proposed for Dunbar's number. It has been proposed to lie between 100 and 230, with a commonly used value of 150."
Facebook is probably showing you updates of probably around 120 - 150 of active people, with about 7-20 very active close friends. And as someone has already mentioned, this has been proven against Dunbar's Number, and in other studies.
I think that quite a lot people have <50 friends (including the fake users). Those don't use facebook very much - just for messaging. So I don't trust those numbers. I don't think people are being more self ware.
I used to have an account on FB but I closed it and it's unlikely I'm going back.
I did create a company page.
I'm on Twitter and I'm giving G+ another go for the third time.
iCloud looks interesting and could be a major threat to FB because I set up a bunch of pages for family just so they could see their grandchildren.
They're on FB for no other reason so iCloud definitely has some potential there.
I'm also more engaged with the Twitter ads than I ever was with the ads on FB, those ads never interested me. I fully expect FB to copy Twitter's ad model.
A person I know added me a few days ago. Today I got around to accepting it...only she says she didn't add me and that FB must be looking at mutual friends and when that number is high enough (5-6), they sometimes create an add. She said she had heard of this happening to a few friends of hers, too.
"As of December 31, 2010, there were 647.6 million active Tencent QQ IM user accounts, making Tencent QQ the world's largest online community. The number of simultaneously online QQ accounts has sometimes exceeded 100 million."
>> "I've always been under the impression that anyone signed up with Facebook probably has a gmail account."
Why do you think that (seriously asking)? Gmail didn't become available to the public until 3 years after Facebook launched (admittedly Facebook was initially limited to certain groups of people). Before I signed up to Facebook Hotmail was still very popular with everyone I knew, mainly because they all used MSN Messenger. It's only been in the last 2/3 years or so I've seen most of the people I know default to Google when creating an email account. Up until then Hotmail was all people really new.
I disagree, I think that they are just looking to make an impact on the world.
If all they wanted was to make money, then there would be ads all over the place, instead of the few, limited places at the moment (the right of the main page area, underneath comments on pictures, etc.)
In all honesty, I don't see why people constantly complain about the ads on twitter or facebook, do they really effect you that much that you would stop using the service?
Facebook has 1,000,000,000 users now, that kind of scaling isn't cheap, you want a large social network with all of your friends which you can use 24/7, completely free (cost for your internet, etc, aside) and that isn't sustainable without the website making money somehow. Most people aren't willing to pay for Facebook, if that was a viable solution then it would be the Facebook income stream.
Saying "Facebook wants to make money, if this doesn't change, I will stop using it" is the same as saying "The company which runs the buses in my area puts ads in it's bus stand, so I'm going to stop standing in it."
Whether we like it or not, Facebook is now an integral part of many peoples lives, I live in a different country to my family, Facebook lets me chat to them easily and freely, I could send them a letter instead, but that's subject the thievery, loss and costs a lot more money.
So Facebook wants more ads on it's site? Who cares? As long as the key features are still there, 1,000,000,000+ people and it doesn't effect the way you interact with the site too much, it doesn't make a difference in the end.
>If all they wanted was to make money, then there would be ads all over the place, instead of the few, limited places at the moment
But then people would hate the site even more than they do now, and would leave. They aren't doing it out of some altruistic desire to "change the world", they are just not total morons who are willing to kill their cash cow for a short term profit.
>Facebook has 1,000,000,000 users now, that kind of scaling isn't cheap, you want a large social network with all of your friends which you can use 24/7, completely free (cost for your internet, etc, aside) and that isn't sustainable without the website making money somehow
Yes it is, there is no reason at all that one company needs to be running it. A distributed social network would work fine.
Yes that the only thing that keep me using it. All my friends are there. But they are pushing promoted posts for groups and users, sponsored stories, offers. My news feed is becoming aggregate for ads.. When they went public all the changes was for the stock price.
Or it kills content you want to see, which Facebook would have shown you normally to have you engage with it - content you'd most want to see. They can only try to milk this so long before the cow dies.