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Facebook really worth $50b

or are we heading for another bust?

January 31, 2011 – 9:18AM

Facebook is not worth $US50 billion, according to a poll of global investors that shows skepticism about Goldman Sachs’ recent estimate of the largest social networking site’s value and concern that a bubble may be forming in the technology sector.

Sixty-nine per cent of investors say Facebook is overvalued after Goldman Sachs invested $US450 million in a deal that put the company’s worth at $US50 billion, according to the quarterly poll of 1000 Bloomberg customers who are investors, traders or analysts. Only 10 per cent of respondents say Facebook’s valuation is appropriate; 4 per cent say it’s worth more.

The Bloomberg Global Poll conducted January 21-24 shows that investors disagree with Goldman Sachs’ assessment that Facebook is worth more than web pioneers such as Yahoo!, the biggest web portal, and eBay, owner of the biggest online retail marketplace. Palo Alto, California-based Facebook surpassed Yahoo! in October as the third most visited website in the world.

“Those investing in Facebook, expecting it to be the next Google, might be in for some bad news along the way,” says poll respondent John J. Lee, a portfolio manager at PGB Trust & Investments in Morristown, New Jersey. Mountain View, California-based Google went public in August 2004 and the shares more than tripled in the first year to $US279.99 from $US85. The stock price averaged $US617.2 this month.

‘Cheaper copycat lookalikes’

“Eventually, all fads get cheaper copycat lookalikes,” he says. “While being first to market makes Facebook a winner, another faster, stronger company with more something will come along and dilute its value.” Lee says his firm owns Google shares in some portfolios.

Facebook raised $US1.5 billion in a Goldman Sachs-led financing round this month. In addition to Goldman Sachs’ $US450 million investment, Russia-based Digital Sky Technologies put up $US50 million and Goldman Sachs clients outside the US snapped up a $US1 billion stake in the company. Goldman Sachs, which retained the right to sell $US75 million of its stake to Digital Sky, had originally offered Facebook shares to its US clients in a private placement. That was called off after details became public because the offering risked running afoul of US securities laws.

Stephen Cohen, a spokesman for New York-based Goldman Sachs, declined to comment. A Facebook spokesman, Jonathan Thaw, declined to discuss the valuation. “We’re focused on creating a useful service and building our business for the long term,” he said in an emailed statement.

‘Dangerous new bubble’

The Bloomberg poll shows that the Facebook deal has made investors uneasy about internet companies in general. More than half the respondents say the firm’s valuation signals the “beginning of a dangerous new bubble” in the market, while only 17 per cent saw it as the foundation of a lasting boom.

“More than a bubble, Facebook is a manifestation of the rational excesses that only the financial markets are capable of when confronted with something without precedents and more importantly unexpected,” said Luigi La Ferla, co-founder of LTP Trade in London. ‘

Investors worldwide have doubts about the Facebook deal, and those outside the US were most pessimistic. Seventy-two per cent of non-US respondents say the company was overvalued. Among US investors that number is 63 per cent.

“There’s too little financial information and track history to value the company like this,” says La Ferla. “Besides, you do not want to buy any of Goldman’s proprietary positions that they’re willing to sell.”

China’s tencent

The $US50 billion valuation puts Facebook in league with publicly traded Tencent Holdings. The Shenzhen, China-based internet company, whose services include online games and instant messaging, is worth more than $US42 billion on the Hong Kong stock exchange. Tencent trades at about 15 times revenue. The Facebook valuation is about 25 times its 2010 revenue. Google’s price-to-sales ratio is 9, analysts estimate. eBay’s market value is $US40.5 billion and Yahoo!’s is $US21.2 billion.

At the end of last week, Facebook’s valuation on SharesPost, a San Bruno, California-based online marketplace for trading shares in private companies, reached $US82.9 billion, an increase of 40 per cent since mid-December. That put the social-networking company in second place among US internet companies after Google, which is worth $US192 billion.

Supplanting Amazon

Facebook supplanted Amazon.com, whose shares dropped as much as 9.5 per cent last week after a disappointing sales forecast, pushing its stock market value down to $US75.2 billion.

Amazon, the biggest online retailer, went public almost 14 years ago. The Seattle-based company said last week that sales in the first quarter will be as low as $US9.1 billion, trailing the average analyst estimate of $US9.36 billion in a Bloomberg survey.

LinkedIn, a Mountain View, California-based professional networking firm, filed last week with the Securities and Exchange Commission to raise as much as much as $US175 million in an initial public offering. The company is valued at $US2.5 billion on Sharespost.

Among European investors in the poll, 56 per cent say the Facebook deal signals a bubble among online firms, while less than half of US-based respondents agree. About a quarter of Asian investors see the deal as the start of a new boom in online companies, while overall 17 per cent of those polled are positive.

‘Lasting boom’

“The current uptrend in e-commerce companies is a lasting boom, with or without Facebook,” says poll respondent Henry Littig, owner of Henry Littig Global Investments AG in Cologne, Germany.

In 2008, Mark Zuckerberg, Facebook’s founder and chief executive officer, became the world’s youngest billionaire at 23 when Forbes Magazine listed his wealth at $US1.5 billion. The magazine now says his net worth has reached $US6.9 billion. Zuckerberg is the central character in the hit movie “The Social Network”, about the founding of Facebook, which was nominated for eight Academy Awards this month.

Facebook’s social network has more than 500 million members and trails only Google and Microsoft as the world’s most visited website, according to ComScore.

The company had revenue of $US1.2 billion in the first three quarters of last year, up from $US777 million, according to a person who had viewed documents sent to potential investors by Goldman Sachs. The company reported profit of $US355 million in the first three quarters of last year, compared with profit of more than $US200 million for all of 2009.

The poll was conducted by Des Moines, Iowa-based Selzer & Co for Bloomberg and has a margin of error of plus or minus 3.1 percentage points.


Sourced & published by Henry Sapiecha

Facebook founder meets

the Social Network actor

who portrayed him

January 31, 2011 – 1:45PM

Awkberg! Zuckerberg networks on TV show

Facebook creator Mark Zuckerberg comes face-to-face with the actor who played him in the movie The Social Network.

The Oscar-nominated movie The Social Network paints an unflattering portrait of Mark Zuckerberg but the Facebook founder apparently doesn’t hold a grudge.

Zuckerberg, 26, came face-to-face during a guest appearance on the popular NBC comedy show Saturday Night Live with Jesse Eisenberg, who received a “Best Actor” nomination for his portrayal of the Facebook creator.

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Founder of Facebook Mark Zuckerberg, left, with actor Jesse Eisenberg.
Founder of Facebook Mark Zuckerberg, left, with actor Jesse Eisenberg. Photo: Saturday Night Live

Eisenberg was delivering the opening monologue for Saturday Night Live when he was joined on stage by a member of the cast, Andy Samberg, who also portrays Zuckerberg in skits on the show.

As the two exchanged tips on their acting techniques, the real Zuckerberg was seen offstage with the show’s producer begging to be allowed to go on.

“Why can’t I go in there?” he said. “I’m the real Mark Zuckerberg.”

“That guy’s like my evil twin,” he said. “Those guys are such nerds.”

When Zuckerberg finally made it on stage, Samberg beat a hasty retreat declaring the encounter “awkberg”.

Eisenberg asked Zuckerberg what he thought of the movie.

“It was interesting,” Zuckerberg said.


Sourced & published by Henry Sapiecha

Twitter site blocked in Egypt:

Harvard’s Herdict


Tue Jan 25, 2011 3:07pm EST

(Reuters) – Egyptians say the Twitter Web site is blocked on all Internet Service Providers in their country, a representative of Harvard University’s Herdict Web monitoring service told Reuters on Tuesday.

But Twitter users within Egypt are currently sending Tweets, short 140-character messages, via SMS text messages and through third-party applications, the center said as thousands of Egyptians took to the streets to protest President Hosni Mubarak’s 30-year rule.

Jillian York, a project coordinator at Harvard’s Berkman Center for Internet & Society, which runs the Herdict Web accessibility monitoring service, said in an email that she had “confirmed with users in Egypt that Twitter.com is in fact blocked on all ISPs.”

Sourced & published by Henry Sapiecha

Germany puts access

limits on Facebook

January 26, 2011

FACEBOOK, which faces potential fines for violating privacy laws in Germany, has agreed to let users there better shield their email contacts from unwanted advertisements and solicitations.

After discussions which dragged out for more than six months, Facebook, which has more than 10 million users in Germany, agreed to modify its ”friend finder” service. Users will be better able to block Facebook’s ability to contact people, including non-Facebook users culled from a user’s email address books.

Tina Kulow, a spokeswoman for Facebook in Hamburg, said users in Germany would be advised that the site could send solicitations to people on their mailing lists if they uploaded their address books to friend finder.

Facebook is the second US internet business to modify its operations to suit German privacy laws, which give individuals extensive control over personal data.

Last year, Google, which also faced fines, let Germans exclude photos of their homes from its ”street view” photographic map archive before the service went live.

Like Google, Facebook changed its operation after Johannes Caspar, the data protection supervisor in Hamburg, began a review of the company’s practices. Violations of German privacy law carry penalties of up to €300,000 ($412,000), though adverse publicity can be more damaging.

Mr Caspar said his office had received ”many, many complaints” during the past six months from Germans who had never used Face- book but were receiving solicitations because their email addresses had been siphoned from friends.

The issue took on political overtones when the German data protection commissioner, Peter Schaar, and the consumer protection minister, Ilse Aigner, criticised Facebook for disregarding privacy laws.

Mr Caspar’s office initially demanded that Facebook deactivate its friend finder service in Germany. But in a compromise, Facebook has agreed to explain the features of friend finder prominently and to tell users how to limit its ability to gain access to contacts and to store them.

The New York Times

Sourced & published by Henry Sapiecha

Let the hacking begin:

Zuckerberg targeted

Louisa Hearn

January 26, 2011 – 1:39PM

Mark Zuckerberg's fan page: 'let the hacking begin'.Mark Zuckerberg’s fan page: ‘let the hacking begin’.

The fan page of Facebook founder Mark Zuckerberg looks to have been targeted by hackers, who penned a message from the billionaire himself suggesting Facebook be turned into a charity-focused business.

Although the message was swiftly removed, technology websiteTechCruch said it had captured a screen shot of the message that had already attracted 1803 likes and 438 comments.

The idealistic comment began with the words: “Let the hacking begin” and contained a link to a Wikipedia page about social businesses with references to Nobel prize winner Muhammad Yunus.

“If facebook needs money, instead of going to the banks, why doesn’t Facebook let its users invest in Facebook in a social way?” read part of the message.

Facebook has not yet responded to inquiries about the comment or its origins, but the social networking site has recently been the target of criticism owing to the escalating number of scams tailored specifically to its members.

A survey conducted by security company Sophos this month asking more than 1200 computer users which social network they felt posed the biggest security risk, found that Facebook ranked ahead of its peers by 82 per cent of respondents.

“One thing is certain, and is unlikely to be news that’s welcomed at Facebook HQ. There is a growing perception out there that Facebook isn’t the safest of places to be,” wrote Sophos senior technology consultant Graham Cluley in a recent blog post.

Some of the key threats recently highlighted by Sophos are rogue applications or survey scams that pop up from users’ own Facebook friends who have been tricked into clicking on an interesting looking news headline or YouTube video that then duplicates to everyone in their friend’s list. It then directs them to click on a website or survey, or inadvertently download malware.

One of the offenders now doing the rounds is a fake application that promises to let you see who has been viewing your profile.

Other Facebook scams have been created to target specific individuals, and then take over their accounts, telling friends they are overseas, have been robbed and are in urgent need of money.

Paul Ducklin, head of technology for Sophos Asia Pacific said fan pages such as Zuckerberg’s often granted a large number of company staff the ability to log in.

“Even if everybody with access to the page is straight-as-a-die honest, they could be keylogged, accidentally leave the page logged in, and all sorts of other things could go horribly wrong. The chain is only as strong as weakest link,” he said.

“Facebook does like to be compared to a country, but the flip side of that is how you actually provide for your citizens in terms of things like a bill of rights or a police service.

“If they set higher standards – for example requiring application developers to identify themselves in a way that is likely to be traceable – that would be slightly less convenient and less open but would be hell of a lot better for its 500 million strong community,” said Ducklin.

Sourced & published by Henry Sapiecha

Social networking

leads to sex faster:

Survey finds….

January 25, 2011 – 8:53AM

Nearly four out of five women and three of five men say they believe texting, Facebook and other social media tools for staying connected cause new couples to jump into bed faster, a survey released this week has found.

However, only around 38 per cent of women say they have actually slept with a date any sooner because of digital intimacy, according to the 1200 women and men who participated in the third annual sex survey by Shape and Men’s Fitness magazines.

Smartphones and laptops are the new toys that lead to the bedroom, it said, with almost 80 per cent of women and 58 per cent of men saying social media tools leads to sex much faster.

Texting is the number one way lovers stay in touch, the survey found, with men texting 39 per cent more often than phoning and women 150 per cent more.

Even before the magic begins, 70 per cent of women and 63 per cent of men use Google and other online tools to screen potential dates.

A full 65 per cent of those polled said they had been asked out by text and 49 per cent through a Facebook message.

Once the relationship clicks, 72 per cent of women report scouring a current partner’s ex-girlfriends’ Facebook pages.

Even in the heat of passion, some people just can’t get enough of their digital devices, the survey found.

When a call or text comes in during sex, a full 5 per cent of respondents said they glance to see who is calling and 1 per cent say they stop to answer the phone.

And when the spark is extinguished, digital dumping is the new way to break up, with 43 per cent of women and 27 per cent of men reporting getting a text along the lines of a dear John “It’s not you, it’s me”.

For the heartbroken, the internet keeps hope alive, with 81 per cent of all respondents saying they won’t de-friend an ex on Facebook and 75 per cent admitting to constantly checking a former sweetheart’s page.

Sourced & published by Henry Sapiecha

Pope warns of alienation risk

in social networks & virtual friends

Pope Benedict XVI waves to a crowd gathered in Saint Peter's square during his Sunday Angelus blessing at the Vatican January 23, 2011. REUTERS/Tony Gentile

Pope Benedict XVI waves to a crowd gathered in Saint Peter’s square during his Sunday Angelus blessing at the Vatican January 23, 2011.

Credit: Reuters/Tony Gentile

By Philip Pullella

VATICAN CITY | Mon Jan 24, 2011 7:32am EST

(Reuters) – Pope Benedict gave a qualified blessing to social networking Monday, praising its potential but warning that online friendships are no substitute for actual human contact.

The 83-year-old pontiff, who does not have his own Facebook account, set out his views in a message with a weighty title that would easily fit into a tweet: “Truth, proclamation and authenticity of life in the digital age.”

He said the possibilities of new media and social networks offered “a great opportunity,” but warned of the risks of depersonalization, alienation, self-indulgence, and the dangers of having more virtual friends than real ones.

“It is important always to remember that virtual contact cannot and must not take the place of direct human contact with people at every level of our lives,” Benedict said in the message for the Catholic Church’s World Day of Communications.

He urged users of social networks to ask themselves “Who is my ‘neighbor’ in this new world?” and avoid the danger of always being available online but being “less present to those whom we encounter in our everyday life.”

The vast horizons of new media “urgently demand a serious reflection on the significance of communication in the digital age,” he said.

The pope did not mention any specific social networking site or application by name, but sprinkled his message with terms such as “sharing,” “friends,” and “profiles.”

He said social networking can help “dialogue, exchange, solidarity and the creation of positive relations” but he also offered a list of warnings.

“Entering cyberspace can be a sign of an authentic search for personal encounters with others, provided that attention is paid to avoiding dangers such as enclosing oneself in a sort of parallel existence, or excessive exposure to the virtual world,” he said.

“In the search for sharing, for ‘friends’, there is the challenge to be authentic and faithful, and not give in to the illusion of constructing an artificial public profile for oneself.”

The pope is known to write most of his speeches by hand while his aides manage his forays into cyberspace. In 2009, a new Vatican website, www.pope2you.net, went live, offering an application called “The pope meets you on Facebook,” and another allowing the faithful to see the Pope’s speeches and messages on their iPhones or iPods.

The Vatican famously got egg on its face in 2009 when it was forced to admit that, if it had surfed the web more, it might have known that a traditionalist bishop whose excommunication was lifted had for years been a Holocaust denier.

Sourced & published by Henry Sapiecha

Twitter + Random Acts of

Kindness =

A Successful Social Campaign

Running out of cereal is usually a problem that one must face on his own. But when David Berkowitz awoke to the dilemma one morning this October, he got some support from an unexpected source. After reading a tweet about his irritation, Edge Shave Gel sent him enough cereal that it should be a very long time before he runs out again.

“I’m still eating the cereal they sent me, so the positive brand association continues,” says Berkowitz.

Since September, 234 people have benefited from similar random acts of kindness from the @EdgeShaveZone Twitter account. As part of Edge’s Anti-Irritation Campaign, a team of two devotes its full-time efforts to seeking, responding to, and relieving irritation across Twitter(Twitter), much of which is conveyed using Edge’s #soirritating hashtag. The team has given out everything from iPads and computers to megaphones and dancing panda YouTube(YouTube) videos in their efforts to “solve irritation.” One woman tweeted that she had voices in her head that were speaking in Spanish — Edge responded with the gift of a Spanish/English dictionary.

In about three months, @EdgeShaveZone has gathered about 1,500 followers, the #soirritating hashtag has been used about 6,800 times, and attention from numerous media outlets has contributed to mounting buzz — all of which likely contributed to Edge’s decision to continue the campaign throughout 2011. Mashable(Mashable) recently spoke with the team at Edelman Digital, that runs the campaign, about the factors that have contributed to its success.

Using Twitter, Not Changing Twitter

Twitter_profWhen was the last time you used Twitter to rave about a product you use every day? Most of us do that quite often. Designing a Twitter campaign that both promotes a brand effectively and fits the platform can be challenging. Instead of trying to change the way that people use the platform, the #soirritating campaign builds on top of what Twitter users are already doing: complaining.“We picked Twitter because we noticed that a truth about Twitter was that people were always talking about how irritated they were about things, and we have a product that matched that truth, which was anti-irritation, so that was a good place for us,” says Katie Facada, the copywriter who composes tweets for @EdgeShaveZone.

The ‘Behind the Social Media Campaign Series‘ is supported by Oneupweb, an agency specializing in search marketing, social media and design for mid-to-enterprise level brands. Keep up with Oneupweb through its blog and monthly newsletter.

Sourced & published by Henry Sapiecha

Twitter Launches in Korean

Ben Parr
1 day ago by Ben Parr 13
Twitter has just launched the Korean version of its popular service, bringing the total of supported languages to seven.

As is typical for the microblogging company, it made the announcement in Korean. In its blog post, Twitter(Twitter) revealed that it chose Korean as the next language for launch because the number of Twitter users from Korea has increased tenfold in the last year. That’s an astounding growth metric.

Not only is Twitter.com now translated in Korean, but so are the official Twitter Android and iPhone apps. It has also launched a recommended user list of Korean users, including actor Park Joong (@moviejhp) and novelist @Oisoo.

Twitter now supports seven languages. The others include Spanish, Italian, German, French, English and Japanese.

Sourced & published by Henry Sapiecha

Social Networks set

To Capture 11%

of all Online Ad Spending

in 2011

U.S. marketers will spend $3.08 billion to advertise on social networking sites this year, according to new estimates from eMarketer.

That’s a 55% increase over the $1.99 billion U.S. advertisers reportedly spent on social networking sites in 2010, and nearly 11% of what they are expected to spend on all online advertising in the U.S. in 2011, eMarketer says.

Worldwide spending on social networks is expected to rise 71.6% to $5.97 billion, approximately 8.7% of the total amount advertisers are predicted to spend online in 2011.

And which social network is poised to take the biggest slice of those ad dollars? You guessed it: Facebook(Facebook).

eMarketer expects that advertisers will spend $4 billion on the social networking giant this year, $2.19 billion of which will come from U.S. advertisers. That’s more than double the amount ($1.86 billion) Facebook pulled in in 2010.

“2010 was the year that Facebook firmly established itself as a major force not only in social network advertising but all of online advertising,” said Debra Aho Williamson, principal analyst at eMarketer. “In 2011, its global presence is something multinational advertisers can’t ignore.”

It could even surpass these estimates if it’s able to increase its global user base and pull in more revenue per user, she said

Sourced & published by Henry Sapiecha

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