Obama Drove Drunk, Too
Obama's Agent Required, And Still Requires, Authors To Submit Their Own Bios
| Main | Krauthammer: "Appalling Double Standard" on Teenage Romney Prank Vs. Obama's Adult Adventures With Reverend Wright
May 18, 2012

On the Facebook IPO

The following comes from two emails I sent the cob loggers last September. I thought I was being dumb about Facebook's business model, so I didn't turn them into a post then. But now people are questioning the value of the stock offering.

Facebook is going to have an IPO eventually worth, I've heard, $100 billion dollars. Why? Why is it valuable? Because they can target advertising to people? How is that ability worth that kind of money?

First, advertisers already have sophisticated ways to learn who their buyers are. Granted, their surveys aren't as detailed, but they move products to the right people. Especially because of the following...

Second, advertising is done en masse. Very little of it is targeted to individuals, and most of that would have to be via computer. I suspect most people stomp on that kind of advertising with with adware and spamware.

Third, this "Facebook is so very valuable" religion that is centered on information is starting to remind me of the hype surrounding chaos theory and complexity. For several years, everybody agreed chaos theory was a Totally Awesome Thing, but no one actually knew what it was or what it was good for. Its value wasn't intrinsic; it was based on social pressure. Everyone had faith we would soon find these awesome uses. And anyone who questioned the religion, say, at a complexity seminar was treated as if they had farted in an elevator. Questions like, "What can be done with this?" And "Does anyone have any empirical data that shows something complexity theory can prove?"

So the reputed value of Facebook has the feel of another one of those religiously-held social beliefs. The reality is, it's just people chatting on the internet.

Why is knowing what toothpaste individuals prefer so valuable? Don't we know what toothpaste people generally want already? If we need more detailed information, don't we already have ways of finding out? You know, like marketing companies, surveys, and actual sales data?

And regarding the future of Facebook.

Also, people hate being shouted at with ads. Facebook is going to have to find something they want without shouting at them. For example, you go to Amazon to buy goods. You don't go to Facebook to buy anything. Ads are going to be ignored or treated with scorn there.

I think Facebook is going to have to find a way to do something else, like supplant the telecoms or buy retailing dotcoms. Whatever it is, it's going to have a completely different flavor, so to speak. They'll have to offer something. Because right now, the business plan appears to be:

1. collect information on people
2. ???
3. profit!

Collecting info on people and spying on their photos can't be worth that much. Something, yes, but not Amazon or Google money.

Maybe I'm showing a lack of vision.

The thing I fear is that they will feel the need to push toward further privacy invasion. Because where can they use their targeted information? At the news kiosk or, say, the quick stop. One of their computers recognizes you and asks you in a very charming way if it's time to buy some more K-Y Jelly. Or, "Hey, Monty! Last week you bought milk. Probably time to get some more! Have a nice day!" Or, "Your girlfriend is in Dallas at Fridays on Mockingbird Lane. Do you want to send her a drink!? How about some roses!?" (You thought your girlfriend was on a business trip to Des Moines.) Can there be anything more annoying than a friendly machine that recognizes you?

Anyway, point being, with all that information they've collected, they are going to be highly motivated to use it somehow, probably invasively. And they'll use a lot of that money to grease Congress to keep things loose so they can get what they want.

Anybody got any ideas? I still think that unless Facebook buys into a way to retail to consumers, the value will drop over time.

Follow me on Twitter.

digg this
posted by rdbrewer at 12:44 PM

| Access Comments

Recent Comments
Mike Hammer, etc., etc.: "Nope. Can't the Nazis and the Commies lose? I am f ..."

Anna Puma (HQCaR): "Speaking of work, best get ready for it. Have an e ..."

J.J. Sefton: " 510 Posted by: Alpine Crotch at July 17, 2018 09 ..."

Brother Cavil, Abbot of St. Costello-on-the-Hurlingbone: "[i]There are two keys to bringing back a serious c ..."

SSBN 656 (G): "Nobody hacked anything (despite the new meme that ..."

willow: "ha why would anyone trust ' putin? of course we c ..."

Donna&&&&&&V sez don't you dare walk the damn pitcher: "450 I believe Poland is once again in danger of i ..."

NaCly Dog: "There are two keys to bringing back a serious coun ..."

illiniwek: "Putin mentioned that $400M ... which is probably n ..."

Trump poisoned my cat: "503: "Which is why they hope a right-wing "patr ..."

Brother Cavil, Abbot of St. Costello-on-the-Hurlingbone: "[i]In U-Haul's case it is both. The man shit his p ..."

CoolHandLuke: "Re: "I hate to say it, but as a last resort, the D ..."

Recent Entries

Polls! Polls! Polls!
Frequently Asked Questions
The (Almost) Complete Paul Anka Integrity Kick
Top Top Tens
Greatest Hitjobs

The Ace of Spades HQ Sex-for-Money Skankathon
A D&D Guide to the Democratic Candidates
Margaret Cho: Just Not Funny
More Margaret Cho Abuse
Margaret Cho: Still Not Funny
Iraqi Prisoner Claims He Was Raped... By Woman
Wonkette Announces "Morning Zoo" Format
John Kerry's "Plan" Causes Surrender of Moqtada al-Sadr's Militia
World Muslim Leaders Apologize for Nick Berg's Beheading
Michael Moore Goes on Lunchtime Manhattan Death-Spree
Milestone: Oliver Willis Posts 400th "Fake News Article" Referencing Britney Spears
Liberal Economists Rue a "New Decade of Greed"
Artificial Insouciance: Maureen Dowd's Word Processor Revolts Against Her Numbing Imbecility
Intelligence Officials Eye Blogs for Tips
They Done Found Us Out, Cletus: Intrepid Internet Detective Figures Out Our Master Plan
Shock: Josh Marshall Almost Mentions Sarin Discovery in Iraq
Leather-Clad Biker Freaks Terrorize Australian Town
When Clinton Was President, Torture Was Cool
What Wonkette Means When She Explains What Tina Brown Means
Wonkette's Stand-Up Act
Wankette HQ Gay-Rumors Du Jour
Here's What's Bugging Me: Goose and Slider
My Own Micah Wright Style Confession of Dishonesty
Outraged "Conservatives" React to the FMA
An On-Line Impression of Dennis Miller Having Sex with a Kodiak Bear
The Story the Rightwing Media Refuses to Report!
Our Lunch with David "Glengarry Glen Ross" Mamet
The House of Love: Paul Krugman
A Michael Moore Mystery (TM)
The Dowd-O-Matic!
Liberal Consistency and Other Myths
Kepler's Laws of Liberal Media Bias
John Kerry-- The Splunge! Candidate
"Divisive" Politics & "Attacks on Patriotism" (very long)
The Donkey ("The Raven" parody)
Powered by
Movable Type 2.64