Sunday, February 25, 2007

Facebook and the Value of Social Networking

Here is an article that discusses the value of facebook. It is interesting to read in the context of our discussions on MySpace as well as our attempts at understanding different revenue models in the web 2.0 space.

What's interesting is that Mark Zuckerberg, the founder of Facebook turned down a $ 1 billion offer from Yahoo last year. Newscorp paid $580 million in 2005 to buy MySpace. Google paid $1.76 billion to buy Youtube.

How much is social networking worth? How to monetize it? What industries (and companies) are likely to be impacted by this trend?

In a related note, here is a software that helps you plot and understand social networks. Some of you may find it interesting and useful.

1 comment:

JI said...

Mark Zuckerberg is a cocky overconfident individual. Refusing to sell his baby for $1B is a classic Web 1.0 blunder. Hindsight 20/20 who wouldn't want to sell Cisco for $80 a share. First of all his business cards read, "I'm the CEO, bitch." Second, there are times when any market gets over estimated and that is when it is time to bail. Did MZ really expect to rival Bill Gates? If not, what is the point of holding on? 1B is more than you can spend in a lifetime, and the ability to start other ventures would be quite significant. This guy was sitting on the winning ticket and he should have taken it. Facebook will be worth 10M in five years. I will take all bets on this. The losing standard becomes worthless, particularly in a digital world. See Metacrawler.