Social Media Advertising

The world of social media has become to interwoven into regular media, that every news story seems to carry an implicit advert for a social media platform to "find out more".

In the case of the BBC, who are usually incredibly stuffy about not mentioning brands and if they do usually chide themselves with "other brands like this are available" to kid us that there is some impartiality going on.

But in the case of social the BBC forget all this and always trumpet what was said on Twitter, what was posted on Facebook.  So if you do not care for such things you cannot get away from it.  There is an implicit assumption here that this is part of normal life and not a product that although free is selling you're personal data like crazy behind the scenes.

Twitter Economics

The Twitter flotation got a lot of press this week.

They floated at $26 a share, with 505 million shares in circulation leading to a market cap of $13.1 bn.

There was lots of interest in the shares and they rose above $50, and now stand at $41.  That's a market cap of around $20 bn.

It's a very popular service, I can't deny that - and it has tentacles into all media outlets - as they have been suckers for feeling the need for a presence on it.  Especially individuals of media who feel the need to self promote (despite the obvious danger of an ill judged tweet ending your career).

But this service has never made a profit, has yet to work out an advertising strategy - and could easily be replaced by a newer more trendy upstart.

I was dubious about Facebook - this is just crazy...

Facebook Economics IV

It has been a long time since I've looked at these shares, and the madness of the Twitter float has made me look back - I was pretty downbeat on them.  Give Facebook their due, it looks like they are working out how to advertise to mobile/small screen users.

So how about the shares?

There are 2.43 billion shared in circulation.

$47.53 dollars per share,  $115.50 bn market capitilsation

$38 dollars at floatation, indicating $92.34 bn value.

So an overall increase of $23.16 bn, a 25% rise in value.

Steady progress I say, and compared to Twitter this almost looks like a sensible business now...

Social Media Sign Up

I've always shunned social media, I suppose not for any deep ideological reason - but just the inevitable consequences of a free service needing to ride on the back of the data you provide to earn money from advertising.  It creates a race-to-zero pressure to always be "innovating" (read taking liberties with your personal information) on the provider.

Of course if social media were "pay-for" I would not use it either, and I know it is up to the user how much information they are prepared to divulge.

But now as a consiencious objector of sorts I face a new threat.  I use the e-mail of a well known provider who also happens to offer a social media element.  But now almost every time I login it feels like there is a new "trick" to try and get me to accidentally sign up to their service.  Obviously as a user I'd like a button that says "not now, not ever" - but there is no way the provider would offer that, they lose an oppourtunity to catch me out.

I'm wondering how long I can hold out for...

Facebook Economics III

I can't resist another analysis. There are 2.13809 billion shares issued. Currently trading at $19.41 per share, $41.50 billion market cap That's a loss of $44.02 billion...

Facebook Economics II

So after my initial post IPO analysis the shares are still taking a battering on the market.

There are 2.13809 billion shares issued.

Currently trading at $23.09 per share, $49.36 billion market cap

That's a loss of $31.96 billion...

Facebook Economics

After a couple of weeks of trading, it's nice to sit down and work out how they are doing

The shares have taken quite a battering, and confidence is down.

There are 2.14 billion shares issued.

$38 per share, $81.32 billion market cap.

This was an incredible floation price, remember it is just a website people use for free, with advertisers try to target those people, and with Facebook every so often changing the privacy rules to try and make it more of a business proposition.

$27 per share, $57.58 billion market cap.

That is a loss of $23.74 billion, 30% of the flotation price. Maybe now things have found their true level, but I cannot see how this business can justify much more than a 10-20 billion value (and even that is pushing the imagination).

That would imply a share price of $9...

Facebook IPO

So it has finally happened a floation on the stock market for $38 dollars a share around $100 bn in market capitalisation. You can now have your own piece of the social media company.

I think the companies frank admission that they have yet to move advertising from the PC platform to mobile (where most users access the site from) probably tells all you need to know about their future. In business terms this means they are already yesterdays company. No doubt extremely popular with users, but unless you put adverts in front of them the "free" bit of the social network will not sustain the business.

I think Zuckerberg and Sandberg know this, so the IPO is probably the height of the company. It is still an amazing story of a business grown from its initial venture capital to this point where they have found enough banks to back a floation and presumably found enough people to initially buy the shares. What was it P T Barnum said about the birth rate of suckers - it's clearly true!

As always it is a crying shame that so many talented people are spending their lives working out how to make users click on an advert to drive revenue growth. Maybe we now know what kills off all civilisations, an increasing obsession with trivia rather than true innovation.

The financial press I have read have all said this is not one for your pension fund!

Facebook IPO

Rumours are the IPO is close to IPO, maybe next week. Expecting to raise an unbelievable $10bn valuating the company at $75bn. Those are incredible figures when you consider what the business really is. They have a lot of mindshare, and certainly a lot more credence than the early dot com companies, but even so?

Still good luck to them, I won't be investing and hopefully my pension funds won't either!

Facebook features

A new feature in Facebook, allows face recognition in photographs and identifies the person has been silently rolled out. Followed by a swift apology for not making it more clear that the feature was appearing.

I suppose it is harmless it sounds like it just picks friends out of photos. But another example of Facebook opting you into something that you might not really need or want.

Tweet Legalise

Following on from yesterday, I was thinking now the Twitter site will probably feel it has an obligation to tell it's users that their identity/data is at risk of being provided to law enforcement, no matter how trivial the law that is being enforced.

Maybe also each tweet will have to carry a signature, much like corporate e-mails which disassociate the corporate entity directly from the person sending the e-mail. "The text in this tweet are the views and responsibility of the tweep only".

I'm looking forward to the "social responsibility" phase of social networking!

Tweet at your peril

The world of court injunctions on media reporting has finally collided with the world of the web and the feeling that you are not responsible or accountable for your comments.

Twitter is a nice idea for sure, surely harmless and possibly useful somewhere between a blog and a status update. But not when you are commenting on affairs of others it seems, you will be in legal hot water.

In some ways I like the injunction in this case because it keeps trivia out of the media, it really is none of our business. But with the social element, we can all find out who this "unamed celebrity" is if we really did care.

But there comes a point where the fact that "everyone knows" is itself a news story, which the media sees as legitimate to report. To think that this gets top billing on the news really does show how the media chases these trivial stories over more pressing world events.

I do not doubt that many managed twitter accounts that celebrity users have probably have legal vetting of anything that gets said, but for the everyday user - say what you like and find out what the consequences are later!

Could be an expensive time in court proceedings. Careless tweets don't cost lives, but it seems they should come with a responsibility warning.