News: Ownership FACEBOOK

Mark Zuckerberg owns 24% of the company, Accel Partners owns 10%, Digital Sky Technologies owns 10%,[48] Dustin Moskovitz owns 6%, Eduardo Saverin owns 5%, Sean Parker owns 4%, Peter Thiel owns 3%, Greylock Partners and Meritech Capital Partners own between 1 to 2% each, Microsoft owns 1.3%, Li Ka-shing owns 0.75%, the Interpublic Group owns less than 0.5%, a small group of current and former employees and celebrities own less than 1% each, including Matt Cohler, Jeff Rothschild, Adam D'Angelo, Chris Hughes, and Owen Van Natta, while Reid Hoffman and Mark Pincus have sizable holdings of the company, and the remaining 30% or so are owned by employees, an undisclosed number of celebrities, and outside investors. Adam D'Angelo, chief technology officer and friend of Zuckerberg, resigned in May 2008. Reports claimed that he and Zuckerberg began quarreling, and that he was no longer interested in partial ownership of the company.

Management
Key management personnel comprise Chris Cox (VP of Product), Sheryl Sandberg (COO), and Donald E. Graham (Chairman). As of April 2011[update], Facebook has over 2,000 employees, and offices in 15 countries.

Revenue
Most of Facebook's revenue comes from advertising. Microsoft is Facebook's exclusive partner for serving banner advertising, and as such Facebook only serves advertisements that exist in Microsoft's advertisement inventory.

Revenues
Facebook generally has a lower clickthrough rate (CTR) for advertisements than most major websites. Banner advertisements on Facebook have generally received one-fifth the number of clicks compared to those on the Web as a whole. This means that a smaller percentage of Facebook's users click on advertisements than many other large websites. For example, while Google users click on the first advertisement for search results an average of 8% of the time (80,000 clicks for every one million searches), Facebook's users click on advertisements an average of 0.04% of the time (400 clicks for every one million pages).

Sarah Smith, who was Facebook's Online Sales Operations Manager, confirmed that successful advertising campaigns can have clickthrough rates as low as 0.05% to 0.04%, and that CTR for ads tend to fall within two weeks. Competing social network MySpace's CTR, in comparison, is about 0.1%, 2.5 times better than Facebook's but still low compared to many other websites. Explanations for Facebook's low CTR include the fact that Facebook's users are more technologically savvy and therefore use ad blocking software to hide advertisements, that users are younger and therefore are better at ignoring advertising messages, and that MySpace users spend more time browsing through content, while Facebook users spend their time communicating with friends and therefore have their attention diverted away from advertisements.
On pages for brands and products, however, some companies have reported CTR as high as 6.49% for Wall posts.[62] Involver, a social marketing platform, announced in July 2008 that it managed to attain a CTR of 0.7% on Facebook (over 10 times the typical CTR for Facebook ad campaigns) for its first client, Serena Software, managing to convert 1.1 million views into 8,000 visitors to their website. A study found that, for video advertisements on Facebook, over 40% of users who viewed the videos viewed the entire video, while the industry average was 25% for in-banner video ads.

Mergers and acquisitions
On November 15, 2010, Facebook announced it had acquired FB.com from the American Farm Bureau Federation for an undisclosed amount. On January 11, 2011, the Farm Bureau disclosed 8.5 million in "domain sales income", making the acquisition of FB.com one of the ten highest domain sales in history.

Operations
A custom-built data center with substantially reduced ("38% less") power consumption compared to existing Facebook data centers opened in April 2011 in Prineville, Oregon. (Wikipedia)

News
Newspapers
News analytics

Read more »

News: FACEBOOK'S surprise

Facebook, the world's largest social network, announced in July 2010 that it had 500 million users around the world. The company has grown at a meteoric pace, doubling in size since 2009 and pushing international competitors aside. Its policies, more than those of any other company, are helping to define standards for privacy in the Internet age.

The company, founded in 2004 by a Harvard sophomore, Mark Zuckerberg, began life catering first to Harvard students and then to all high school and college students. It has since evolved into a broadly popular online destination used by both teenagers and adults of all ages. In country after country, Facebook is cementing itself as the leader and often displacing other social networks, much as it outflanked MySpace in the United States.

But it has also come to be seen as one of the new titans of the Internet, challenging even Google with a vision of a Web tied together through personal relationships and recommendations, rather than by search algorithms. In a major expansion, Facebook has spread itself across other Web sites by offering members the chance to "Like'' something — share it with their network — without leaving the Web page they're on.

In November 2010, Mr. Zuckerberg introduced Facebook Messages, a new unified messaging system that allows people to communicate with one another on the Web and on mobile phones regardless of whether they are using e-mail, text messages or online chat services.

The company raised $500 million from Goldman Sachs and a Russian investor in January 2011 in a deal that values the company at $50 billion — more than companies like eBay, Yahoo and Time Warner. The stake by Goldman Sachs, considered one of Wall Street’s savviest investors, signals the increasing might of Facebook, which has already been bearing down on giants like Google.
But in a surprise move, Goldman said in January that it was limiting its offer to foreign clients because of worries that the deal might run afoul of securities regulations. The decision was considered a serious embarrassment for the bank, which had marketed the investment to its wealthiest clients, including corporate magnates and directors of the nation’s largest companies.

While it has come under fire for a series of privacy stumbles, Facebook largely remains a darling of politicians. But the company has watched the missteps of Microsoft and Google in Washington, and knows that its current skirmishes are merely a prelude to looming clashes over its influence on the economic and social Web.

It is building a stalwart defense, moving at broadband speed from start-up to realpolitik strategist. One strategy has been to befriend Washington. Facebook has layered its executive, legal, policy and communications ranks with high-powered politicos from both parties, beefing up its firepower for future battles in Washington and beyond. In March 2011, the company was trying to lure Robert Gibbs, President Obama’s former White House press secretary, to its communications team.

Read More...

Disputed Origins

The company's rise has been marked by strings of controversies. Three other Harvard students maintain that they came up with the original idea and that Mr. Zuckerberg, whom they had hired to write code for the site, stole the idea to create Facebook. Facebook has denied the allegations. A long-running lawsuit is pending. Another Harvard classmate, Aaron Greenspan, claims that he created the underlying architecture for both companies, but has declined to enter the legal battle.

A 2010 movie about Facebook’s tumultuous origins, "The Social Network," offered up what A.O. Scott called "a creation story for the digital age and something of a morality tale, one driven by desire, marked by triumph, tainted by betrayal and inspired by the new gospel: the geek shall inherit the earth."

Facebook has strenuously, and Mr. Zuckerberg more quietly, asserted that the portrayal of the company's founding is fiction. And Mr. Zuckerberg disputed the characterization of him in the film, though in a New Yorker magazine profile, he acknowledged having indulged in a bit of sophomoric arrogance.

Privacy Concerns

Like other social networks, Facebook allows its users to create a profile page and forge online links with friends and acquaintances. It has distinguished itself from rivals, partly by imposing a spartan design ethos and limiting how users can change the appearance of their profile pages. That has cut down on visual clutter and threats like spam, which plague rivals. It has decisively outstripped other networks that preceded it, like MySpace and Friendster, becoming what many analysts see as the "default platform'' of a new age of information organized around personal relationships.

The back and forth between Facebook and its users over privacy is gaining importance as the company's growth continues unabated. Facebook's policies, more than those of any other company, are helping to define standards for privacy in the Internet age.

Bowing to pressure over privacy concerns, the company in May 2010 unveiled a set of controls that he said would help people understand what they were sharing online, and with whom.

Facebook's biggest mistake, Mr. Zuckerman said, had been in failing to notice that as Facebook added new features and its privacy controls grew increasingly complicated, those controls became effectively unusable for many people.

In October 2010, Facebook acknowledged that some applications on its site, including the popular game FarmVille, had improperly shared identifying information about users, and in some cases their friends, with advertisers and Web tracking companies. The company said it was talking to application developers about how they handled personal information, and was looking at ways to prevent this from happening again.

The Goldman Deal

In January 2011, Facebook raised $500 million from Goldman Sachs and a Russian investor in a transaction that values the company at $50 billion. As part of the deal with Facebook, the bank could raise as much as $1.5 billion from investors for Facebook. The new money will give the company more firepower to steal away valuable employees, develop new products and possibly pursue acquisitions — all without being a publicly traded company. The investment may also allow earlier shareholders, including Facebook employees, to cash out at least some of their stakes.

The new investment came as the Securities and Exchange Commission has begun an inquiry into the increasingly hot private market for shares in Internet companies, including Facebook, Twitter, the gaming site Zynga and LinkedIn, an online professional networking site. Some experts suggest the inquiry is focused on whether certain companies are improperly using the private market to get around public disclosure requirements.

Also in January, catching many off guard, Goldman said that it would limit its Facebook offering to foreign investors, excluding clients in the United States because of worries that the deal could run afoul of securities.

The offering to high-net-worth clients was supposed to have been a triumph for the firm, not the serious embarrassment it became. Goldman has been trying to move past run-ins with regulators, including a $550 million settlement with the Securities and Exchange Commission in 2010 over a complex mortgage investment. The Facebook plan will likely raise new questions about whether Goldman tried to push regulatory boundaries once again.

Mr. Zuckerberg had sought to keep close control over the company, spurning a $1 billion offer from Yahoo in 2006 and playing down the idea of a stock offering. But in the wake of the Goldman investment, Facebook said that it will begin reporting its financial results by April 2012, setting the stage for a likely IPO.

The company, based in Palo Alto, Calif., earned $355 million on $1.2 billion in revenue during the first nine months of 2010, according to a document prepared by Goldman for potential investors. That is up from $220 million in earnings on $770 million in sales in 2009. (http://topics.nytimes.com)

News
Newspapers
News analytics

Read more »

News FACEBOOK

Facebook (stylized facebook) is a social networking service and website launched in February 2004, operated and privately owned by Facebook, Inc.

As of January 2011[update], Facebook has more than 600 million active users. Users may create a personal profile, add other users as friends, and exchange messages, including automatic notifications when they update their profile. Additionally, users may join common interest user groups, organized by workplace, school or college, or other characteristics. The name of the service stems from the colloquial name for the book given to students at the start of the academic year by university administrations in the United States to help students get to know each other better. Facebook allows anyone who declares themselves to be at least 13 years old to become a registered user of the website.

Facebook was founded by Mark Zuckerberg with his college roommates and fellow computer science students Eduardo Saverin, Dustin Moskovitz and Chris Hughes. The website's membership was initially limited by the founders to Harvard students, but was expanded to other colleges in the Boston area, the Ivy League, and Stanford University. It gradually added support for students at various other universities before opening to high school students, and, finally, to anyone aged 13 and over.

A January 2009 Compete.com study ranked Facebook as the most used social networking service by worldwide monthly active users, followed by MySpace. Entertainment Weekly included the site on its end-of-the-decade "best-of" list, saying, "How on earth did we stalk our exes, remember our co-workers' birthdays, bug our friends, and play a rousing game of Scrabulous before Facebook?" Quantcast estimates Facebook has 135.1 million monthly unique U.S. visitors in October 2010. According to Social Media Today, in April 2010 an estimated 41.6% of the U.S. population had a Facebook account.

Mark Zuckerberg wrote Facemash, the predecessor to Facebook, on October 28, 2003, while attending Harvard as a sophomore. According to The Harvard Crimson, the site was comparable to Hot or Not, and "used photos compiled from the online facebooks of nine houses, placing two next to each other at a time and asking users to choose the 'hotter' person".
To accomplish this, Zuckerberg hacked into the protected areas of Harvard's computer network and copied the houses' private dormitory ID images. Harvard at that time did not have a student "facebook" (a directory with photos and basic information). Facemash attracted 450 visitors and 22,000 photo-views in its first four hours online.[12][14]

The site was quickly forwarded to several campus group list-servers, but was shut down a few days later by the Harvard administration. Zuckerberg was charged by the administration with breach of security, violating copyrights, and violating individual privacy, and faced expulsion. Ultimately, however, the charges were dropped.[15] Zuckerberg expanded on this initial project that semester by creating a social study tool ahead of an art history final, by uploading 500 Augustan images to a website, with one image per page along with a comment section.[14] He opened the site up to his classmates, and people started sharing their notes.

The following semester, Zuckerberg began writing code for a new website in January 2004. He was inspired, he said, by an editorial in The Harvard Crimson about the Facemash incident.[16] On February 4, 2004, Zuckerberg launched "Thefacebook", originally located at thefacebook.com.[17]

Six days after the site launched, three Harvard seniors, Cameron Winklevoss, Tyler Winklevoss, and Divya Narendra, accused Zuckerberg of intentionally misleading them into believing he would help them build a social network called HarvardConnection.com, while he was instead using their ideas to build a competing product.[18] The three complained to the Harvard Crimson, and the newspaper began an investigation. The three later filed a lawsuit against Zuckerberg, subsequently settling.[19]

Membership was initially restricted to students of Harvard College, and within the first month, more than half the undergraduate population at Harvard was registered on the service.[20] Eduardo Saverin (business aspects), Dustin Moskovitz (programmer), Andrew McCollum (graphic artist), and Chris Hughes soon joined Zuckerberg to help promote the website. In March 2004, Facebook expanded to Stanford, Columbia, and Yale.[21] It soon opened to the other Ivy League schools, Boston University, New York University, MIT, and gradually most universities in Canada and the United States.[22][23]

Facebook incorporated in the summer of 2004, and the entrepreneur Sean Parker, who had been informally advising Zuckerberg, became the company's president.[24] In June 2004, Facebook moved its base of operations to Palo Alto, California.[21] It received its first investment later that month from PayPal co-founder Peter Thiel.[25] The company dropped The from its name after purchasing the domain name facebook.com in 2005 for $200,000.

Facebook launched a high-school version in September 2005, which Zuckerberg called the next logical step. At that time, high-school networks required an invitation to join. Facebook later expanded membership eligibility to employees of several companies, including Apple Inc. and Microsoft. Facebook was then opened on September 26, 2006, to everyone of age 13 and older with a valid email address.

On October 24, 2007, Microsoft announced that it had purchased a 1.6% share of Facebook for $240 million, giving Facebook a total implied value of around $15 billion. Microsoft's purchase included rights to place international ads on Facebook. In October 2008, Facebook announced that it would set up its international headquarters in Dublin, Ireland. In September 2009, Facebook said that it had turned cash flow positive for the first time. In November 2010, based on SecondMarket Inc., an exchange for shares of privately held companies, Facebook's value was $41 billion (slightly surpassing eBay's) and it became the third largest US web company after Google and Amazon. Facebook has been identified as a possible candidate for an IPO by 2013.

Traffic to Facebook increased steadily after 2009. More people visited Facebook than Google for the week ending March 13, 2010. Facebook also became the top social network across eight individual markets — in Australia, the Philippines, Indonesia, Malaysia, Singapore, New Zealand, Hong Kong and Vietnam — while other brands commanded the top positions in certain markets, including Google-owned Orkut in India, Mixi.jp in Japan, CyWorld in South Korea, and Yahoo!'s Wretch.cc in Taiwan.[citation needed]

In March 2011 it was reported that Facebook removes approximately 20,000 profiles from the site every day for various infractions, including spam, inappropriate content and underage use, as part of its efforts to boost cyber security.

In early 2011, Facebook announced plans to move to its new headquarters, the former Sun Microsystems campus in Menlo Park, California. (http://en.wikipedia.org)

News
Newspapers
News analytics

Read more »