100 billion dollars. Sounds good doesn’t it? Now say it again and savour the clean, evenness of it and just consider all the possibilities that come with it…one hundred. Billion. Dollars.
It’s an impressive sum, no? For most of us to even consider having anything to do with such a figure is (and could unfortunately remain) the dreams of pipes, but for a lucky few, this landmark has been realised. That’s it – the end of the rainbow…time to kick back and relax, right? Wrong. A small group of technological/business/social visionaries who have reached the 100 billion dollar mark, are now setting their sights on even loftier fortunes! But where do you go from 100 billion dollars?
Well, as Facebook hits the stock markets in what is the tech industry’s most hotly anticipated flotation since sliced bread, the key question (besides the final valuation – currently estimated at $100 billion) is how will it continue to grow? Or indeed can it continue to grow?? Well rather unsurprisingly, the bedroom-born behemoth’s founder, Mark Zuckerberg, is assuredly positive about how it can and will continue to develop as a company…
- Facebook – such an ‘appy’ place!
“Facebook revealed that $557m of its $3.7bn revenues last year came from taking a cut of payments that users make to Facebook app developers.” – with such a significant portion of its revenue coming from apps, Facebook needs to demonstrate to investors that more and more businesses will continue to see it as a platform upon which they can connect with consumers
“The speed with which Facebook has been growing revenues from advertising slowed over 2011. Growth is still enviable, at 44 per cent in the last three months, but the company now needs to persuade investors that advertisers will expand their spending with Facebook dramatically.” – the heady days of a ‘Mad Men’-esque advertising industry are, well not ‘over’ but definitely ‘on hold’…and in a time of increasingly restricted budgets, Facebook faces the challenge of convincing investors that it is the most desirable and engaging direct-to-consumer platform.
Now, this sounds like an easy enough sell given its popularity, but the delicate balance Facebook needs to strike is to merge advertising into the users experience without becoming too abrasive for the 850million members – something that has already been flagged as an issue with advertising regulators taking steps to allow web users the option of opting out of all Online Behavioural Advertising. While this will make web browsing less intrusive for the consumer, it could spell trouble for Facebook’s ad revenue…
“China has around 500 million citizens on the internet, and social networking is as ubiquitous there as it is in the West, but Facebook is blocked by the Communist authorities in favour of local sites that are willing to censor.” – the absence of a single dominant social network makes China a hugely promising market for Facebook and although there are no definite plans for Facebook to look East yet, perhaps you could be scrolling through your friends ‘狀態更新’s soon…
Now it’s not for me to say whether Facebook should focus on hosting apps that offer focused advertising for Chinese organisations, or whether it should celebrate it’s $100bn and sell up to one of the other tech behemoths, but even the most hardened cynics can’t questions that from a college dorm creation to $100 billion, is an inspiring journey…
For more thoughts from the H+K Strategies’ Technology team, check us out on Twitter – @HK_TechLabs