Posts Tagged ‘Facebook’

A new study shows that homeless young people use Facebook, Twitter, or other social networks as often as college students. The author of the study (available here; subscription needed) hypothesizes that this means that the “digital divide” is overblown, and primarily a generational, rather than income-based, one.

But this assumes that simply using technology is where the divide exists. When I taught high school, my students struggled with the very basics of word processing: touch-typing, setting the margins, spellcheck. When it came to online research, copying and pasting from Wikipedia was par for the course. They could play plenty of Flash games, but they had trouble accessing information useful in their lives — banking, local resources, scholarships.

We need to think about the use case for technology and how to make it useful for low-income families and young people, rather than just patting ourselves on the back for having access across demographic and income groups. How could we better connect them to job training and placement, political groups, continuing education (that isn’t a scam), etc.?

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A look at the latest market cap numbers for Facebook’s IPO suggest that Facebook’s total shares are worth >$100 million–more than Amazon, Visa, and McDonald’s. This seems fucking crazy.

Consider Facebook’s price-to-earnings ratio. At $100 billion/($205 million*4 quarters), that’s a P/E ratio of 100. (Yes, I know P/E ratio is not a great indicator of true stock value, but it is a great comparison of how a company is doing compared to how stock speculators think the stock is doing.) Which means that everyone thinks Facebook’s profits are going to skyrocket:

Sundaram says judging from this price these investors seem to believe that the company’s profits will double, and then double again, and then double again — all within the next few years.

For that to happen, Facebook will need to attract 10 percent of all advertising dollars spent on the planet “across all media – print, billboards, radio, television, Internet,” Sundaram says. While this is theoretically possible, Sundaram says it’s “an extremely low probability.”

Last year, Facebook had just over $3 billion in global ad sales. TV ad sales in the U.S. alone last year were $68 billion.

Facebook has convinced investors that its 1 billion users and deep data mining on its users will make it an advertising gold mine. Unfortunately for Facebook, it’s not a fledgling start-up with lots of room to grow. Instead, Facebook is plateauing, without a clear vision of how advertising will expand at a dramatic rate.

I’m not saying that buying Facebook stock is a bad bet. It may well be a good bet, as everyone else seems to be betting the same thing, thus raising stock prices. Irrational exuberance is all part of the game. But I am wondering why people consider Facebook such a “sure thing.” As far as I can tell, Facebook doesn’t actually make that much money, which doesn’t seem to be a recipe for long-term success.

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First, you should really go back and view this graphic about the evolution of Facebook privacy settings, and how ever-more information is shared with everyone.

Then, you should read the following exchange Facebook founder and CEO Mark Zuckerberg once had on IM:

ZUCK: yea so if you ever need info about anyone at harvard
ZUCK: just ask
ZUCK: i have over 4000 emails, pictures, addresses, sns
FRIEND: what!? how’d you manage that one?
ZUCK: people just submitted it
ZUCK: i don’t know why
ZUCK: they “trust me”
ZUCK: dumb fucks

That doesn’t exactly instill confidence in your privacy, does it? This was from a few years ago, and Zuckerberg and his defenders say he has matured since he was a young college kid. Maybe. But if you ask me, a billion dollars to a young man usually doesn’t speed up the maturation process that much.

That IM exchange is reported in this profile in the New Yorker on Zuckerberg. All this accompanies an upcoming film written by Aaron Sorkin (aka the West Wing creator and main writer) that comes out soon. It’s (cheekily) called The Social Network.

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Via Anne Laurie at Balloon Juice, here is a stunning visual representation of how default privacy settings have changed on Facebook since 2005. For starters, in 2005:

In 2007:

And as of right now:

That’s absolutely stunning, right? I always love to see a good graphic that finds convenient and effective ways of presenting data. And FYI, you should probably go to “privacy settings” and make some changes in your Facebook account if this bothers you, particularly the recent changes that make all of your information available to virtually everyone, including third-party websites.

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