Comments on: F8ce the music. http://saunderslog.com/2008/01/27/f8ce-the-music/ A daily round table on the tech industry with experts and callers from all over the globe. Join us as we pick apart the news and get to the meat of what\'s happening out there. Fri, 04 Jul 2008 14:57:13 +0000 http://wordpress.org/?v=2.5.1 By: The Latest At Facebook #242 | The Latest at Facebook http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-587068 The Latest At Facebook #242 | The Latest at Facebook Fri, 15 Feb 2008 04:29:31 +0000 http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-587068 [...] have joined the “No, I will NOT invite 20 friends just to add your application!” group. Blogger Alec Saunders has recent statistics from Adonomics showing that the top 10 Facebook apps have recently seen [...] [...] have joined the “No, I will NOT invite 20 friends just to add your application!” group. Blogger Alec Saunders has recent statistics from Adonomics showing that the top 10 Facebook apps have recently seen [...]

]]> By: Jim Mirkalami http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-571330 Jim Mirkalami Thu, 07 Feb 2008 05:38:37 +0000 http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-571330 I have been a frequent visitor of this blog for some time now, so I thought it would be a good idea to leave you with my thanks. Regards, Jim Mirkalami I have been a frequent visitor of this blog for some time now, so I thought it would be a good idea to leave you with my thanks.

Regards,
Jim Mirkalami

]]> By: inkblurt » Facebook Dystopia http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-553961 inkblurt » Facebook Dystopia Tue, 29 Jan 2008 21:27:39 +0000 http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-553961 [...] what really chafes me about it is the Facebook Apps framework. I’m in full agreement with this post about Facebook, except that I’m not going to blame the developers that [...] [...] what really chafes me about it is the Facebook Apps framework. I’m in full agreement with this post about Facebook, except that I’m not going to blame the developers that [...]

]]> By: VentureBeat » The second wave of Facebook applications should be better. Example: Frengo http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-551852 VentureBeat » The second wave of Facebook applications should be better. Example: Frengo Mon, 28 Jan 2008 22:54:58 +0000 http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-551852 [...] applications on Facebook are pointless and people are increasingly ignoring them. Take a look at this list of top Facebook applications, by daily active users. Across the board, these applications — [...] [...] applications on Facebook are pointless and people are increasingly ignoring them. Take a look at this list of top Facebook applications, by daily active users. Across the board, these applications — [...]

]]> By: Have Facebook Apps Peaked? - The Unofficial Facebook Blog http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-551537 Have Facebook Apps Peaked? - The Unofficial Facebook Blog Mon, 28 Jan 2008 16:57:12 +0000 http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-551537 [...] the possibility of Facebook applications hitting their peak. Much of this was in response to a blog post written up by Alec Saunders. Alec argues that thanks to the spammy tactics used by many application [...] [...] the possibility of Facebook applications hitting their peak. Much of this was in response to a blog post written up by Alec Saunders. Alec argues that thanks to the spammy tactics used by many application [...]

]]> By: Matt http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-551438 Matt Mon, 28 Jan 2008 15:41:36 +0000 http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-551438 i wanted to correct some facts on my previous post. it turns out that 2 hedge funds each put around $250 million in FB in 2007, bringing Facebook's total 2007 cash haul to $750 million. (this definitely did not get a lot of press.) Here's an excerpt from (Conde Nast Portfolio,con) http://www.portfolio.com/views/blogs/daily-brief/2007/10/25/why-the-rush-for-facebook-at-these-prices (ed. note: critically, FB had expected 2007 revenue of only $150 million and expected 2007 earnings of only $30 million. It points out that a $15 billion dollar valuation entails a whopping 500 P/E (price/earnings) ratio.) "Hot on the heels of Microsoft's $240 million purchase of a 1.6 percent equity stake in Facebook—which values the social networking startup at $15 billion—comes word that the hedgies are getting into the action. Elizabeth Corcoran at Forbes.com reports that two New York-based hedge funds have each contributed $250 million to Facebook's current financing round—using the same valuation as Microsoft—bringing the three-year-old startup's cash haul to about $750 million. Facebook is expected to earn $30 million this year on $150 million revenue. In other words, three investors have spent $750 to acquire a collective 5 percent stake in a company that is expected to earn $30 million this year. As the Wall Street Journal's Dana Cimilluca points out, that values Facebook at 500 times expected 2007 earnings. Ladies and gentlemen of the jury, this is ludicrous. It's time for a reality check. Wired's Fred Vogelstein crunches some numbers to figure out what Facebook would have to earn to justify a $15 billion valuation, were it a public company. Assuming Facebook's stock traded at 56 times 2008 earnings—that was Google's P/E ratio shortly after its initial public offering—Vogelstein concludes that Facebook would have to have earnings—not revenue—of $270 million. "I think social networking will change the way the world uses the Internet, and Facebook certainly has an early lead in that race," Vogelstein writes. "All that said, for a company with current revenues of only about $150 million, virtually no profits and plans to double its staff to 700 in a year, $15 billion seems a little . . . er . . . frothy, no?" i wanted to correct some facts on my previous post. it turns out that 2 hedge funds each put around $250 million in FB in 2007, bringing Facebook’s total 2007 cash haul to $750 million. (this definitely did not get a lot of press.)

Here’s an excerpt from

(Conde Nast Portfolio,con)

http://www.portfolio.com/views/blogs/daily-brief/2007/10/25/why-the-rush-for-facebook-at-these-prices

(ed. note: critically, FB had expected 2007 revenue of only $150 million
and expected 2007 earnings of only $30 million. It points out that a $15 billion dollar valuation entails a whopping 500 P/E (price/earnings) ratio.)

“Hot on the heels of Microsoft’s $240 million purchase of a 1.6 percent equity stake in Facebook—which values the social networking startup at $15 billion—comes word that the hedgies are getting into the action.

Elizabeth Corcoran at Forbes.com reports that two New York-based hedge funds have each contributed $250 million to Facebook’s current financing round—using the same valuation as Microsoft—bringing the three-year-old startup’s cash haul to about $750 million.

Facebook is expected to earn $30 million this year on $150 million revenue.

In other words, three investors have spent $750 to acquire a collective 5 percent stake in a company that is expected to earn $30 million this year. As the Wall Street Journal’s Dana Cimilluca points out, that values Facebook at 500 times expected 2007 earnings.

Ladies and gentlemen of the jury, this is ludicrous. It’s time for a reality check.

Wired’s Fred Vogelstein crunches some numbers to figure out what Facebook would have to earn to justify a $15 billion valuation, were it a public company.

Assuming Facebook’s stock traded at 56 times 2008 earnings—that was Google’s P/E ratio shortly after its initial public offering—Vogelstein concludes that Facebook would have to have earnings—not revenue—of $270 million.

“I think social networking will change the way the world uses the Internet, and Facebook certainly has an early lead in that race,” Vogelstein writes. “All that said, for a company with current revenues of only about $150 million, virtually no profits and plans to double its staff to 700 in a year, $15 billion seems a little . . . er . . . frothy, no?”

]]> By: devin c holloway http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-551286 devin c holloway Mon, 28 Jan 2008 13:20:52 +0000 http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-551286 Alec, I agree with the popular consent that something needs to be done to prevent this forced viral SPAM. An invite to the "Perfect Match" application from a cute girl I know prompted a post with a similar tone from me earlier this month. http://nost.radam.us/2008/01/annoying-application-forced-spam.html I like how you took this one step farther by illustrating how much attrition a lot of these apps have experienced. Thanks for spreading the word about this annoying practice! :-) Alec, I agree with the popular consent that something needs to be done to prevent this forced viral SPAM. An invite to the “Perfect Match” application from a cute girl I know prompted a post with a similar tone from me earlier this month.

http://nost.radam.us/2008/01/annoying-application-forced-spam.html

I like how you took this one step farther by illustrating how much attrition a lot of these apps have experienced. Thanks for spreading the word about this annoying practice! :-)

]]> By: Alec http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-551268 Alec Mon, 28 Jan 2008 13:01:39 +0000 http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-551268 Montoya -- very nice. I had a similar reaction to the first forced invite that I saw. Montoya — very nice. I had a similar reaction to the first forced invite that I saw.

]]> By: luca http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-550740 luca Mon, 28 Jan 2008 05:09:13 +0000 http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-550740 That's the #1 concern of most VCs right now. That’s the #1 concern of most VCs right now.

]]> By: Montoya http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-550631 Montoya Mon, 28 Jan 2008 03:08:01 +0000 http://saunderslog.com/2008/01/27/f8ce-the-music/#comment-550631 I just wanted to say that I saw this crap coming months ago and I even wrote up a "manifesto" which I posted here: http://apprevie.ws/2007/11/12/the-facebook-app-manifesto/ When I posted a link to it on the dev board, everyone just scoffed and shooed me away for proposing any kind of order or ethics to app development. Big surprise. The reality is that the developers who make force-invite apps are gaming the system so they can inflate their numbers and rip off advertisers and companies that buy apps. There's money in those numbers which is exactly why they do it. It's up to the businessmen handing them wads of cash to realize that any app which screws with users is usless in the long run and start investing more carefully. Until then, this crap is going to continue. I wanted to help the dev community become more ethical, to nip this mess in the bud back when things were still decent, but as long as developers are going to push me out of the discussion I'm just saving my breath. I just wanted to say that I saw this crap coming months ago and I even wrote up a “manifesto” which I posted here:

http://apprevie.ws/2007/11/12/the-facebook-app-manifesto/

When I posted a link to it on the dev board, everyone just scoffed and shooed me away for proposing any kind of order or ethics to app development. Big surprise.

The reality is that the developers who make force-invite apps are gaming the system so they can inflate their numbers and rip off advertisers and companies that buy apps. There’s money in those numbers which is exactly why they do it. It’s up to the businessmen handing them wads of cash to realize that any app which screws with users is usless in the long run and start investing more carefully. Until then, this crap is going to continue. I wanted to help the dev community become more ethical, to nip this mess in the bud back when things were still decent, but as long as developers are going to push me out of the discussion I’m just saving my breath.

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