Did you RSVP for Facebook’s NASDAQ arrival party?

I didn’t, but that’s probably because I have a few other priorities than simply throwing hundreds of dollars at something that could follow the trend of other Web 2.0/2.5 companies that have shown significant declines since their respective IPOs.

While listening to This Week in Tech 1  last night, I heard an interesting factoid about the upcoming release of millions of shares on the public NASDAQ stock market: that while Google’s stock price and value represents about five times its revenue, Facebook will be releasing enough stock near 20-25 times its revenue, even if it prices its first commitment between $28 and $35 2 as reports suggest.

I don’t claim to know the inner-workings of any stock market, much less the NASDAQ, but I can’t see how Facebook can get away with raising their prices that high compared to their value—essentially a forecast of their revenue. Facebook isn’t completely monetizing what it can on its service, and that’s fine with me. When I log into Facebook, I can’t help but take a look at the right side bar and just be disappointed with all the ads that I see on it. Nothing interests me, and they could be advertisements for anything, regardless of what terms I have in my profile for interests and other information. Regardless of how clueless I am to Facebook’s means to control their destiny, it doesn’t necessarily means that I’m the target market, so to speak.

Mobile has been a particular loophole for Facebook’s ad-serving revenue model services for a while, now and it seems that people have wised up to it. The company even had to amend the S-1 paperwork in such a way to communicate that while the prospects for growing the active user number is favorable, increasing the audience for its ads will not grow on the same track thanks to its lack of ads on its mobile services. 3

TWiT panelists went on to theory craft about why Facebook and other systems like BBM, iMessage and even email have been the disrupting force in mobile as of late, leaving cellular providers with little alternative than to jack up data plan rates to make up for SMS texting plans not being the revenue generating behemoth that they used to be in the United States. I think the mobile increase is also attributable to a more basic wish that users of Facebook know they won’t have to deal with ads and irrelevancy while on the mobile platform for the social network.

I can find no ads in its mobile website. Why would I need to update my profile using the normal web version of Facebook?

Even though it’s more than likely that loopholes similar to its lack of mobile ad monetization will be sticking points for few Facebook investors willing to throw around hundreds to thousands of dollars wanting to be on the Facebook IPO rally this Friday, the overwhelming amount of reports and signs suggest that Facebook will have a great day raising funds and being justified in its valuation of $11 billion. That’s fine and more power to them.

I just wish that Facebook never became as popular and successful as it was. Not that I ever developed a competing product or anything of the nature, but I do think that we would have a few less annoying ‘innovations’ as a result of their development.

  1. TWiT is one of the few podcasts I listen to. You can find it at TWiT.tv.
  2. Here’s a report from AllFacebook.com talking about $FB’s initial public offering pricing.
  3. Forbes has a pretty good write up of the S-1 changes and the company’s risk in the mobile space.

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.