General Consultant Discussion

If I don't read another story about Facebook IPO, etc , it will be too soon. This is an interesting perspective that I think sums up the downside to Facebook (their ads are ineffective and at some point they'll run of our businesses to experiment with FB ads). Of course the article also assumes that FB will remain the same and not improve their advertising. My guess is that pretty quickly FB will try to release an ad platform very similar to Google's Adwords. However it's going to be a very delicate balance between servicing ads that make enough money and ads that drive away user engagement.

I wasn't surprised the FB priced the stock at the top end to the exptected price. The most valuable asset FB has for advertisers is the specific gemographic information it has of it's users. For FB to substantiate its projected valuation, it needs to grow advertisting revenue expontentially and in a short time (one to two years). I also see users chaffing when theysee increased advertising on FB. Privacy issues will also increase. I not buying FB stock today. Disclosure - I have no association with Facebook.

Based on Ratios, FB at $38 is like 10x more valuable than Google. But as I mentioned to Wayne earlier, people use Google almost all the time when they are either thinking of, or actually buying something. Facebook ads are more like TV ads, just random noise that gets lucky once in a while. Other than being more targeted based on demographics I don't see it. Actually literally I don't see it as I use adblocker and have been for years so I keep forgetting the internet is flooded with banner ads. Don't know why the vast majority of people don't install one of these plugins, they are dead simple. Plus more and more people use FB on their phone and there is very little room, especially at 3g speeds, for intrusive ads.

Someone will write a book about companies that couldn't sustain themselves and either disolved or were acquired. Companies will include Kodak, Eastern Airlines, American Motors, Washington Mutual, Merrill Lynch and Montgomery Ward. The chapter on FaceBook will be titled, ""The Emperor's New Clothes.

It hasn't even been a week and the shreholder lawsuits have started against the banks handling the IPO and Mark Zuckerberg. Is the honeymoon over already?