In an article found posted on the Wall Street Journal website, it describes the recent news that facebook is preparing to release its initial public offering and is expected to raise as much as $10 billion and value the company between $75 to 100 billion. This would be one of the largest IPO’s ever for a U.S. company. They deliver a social media service that has attracted more than 800 million members since they were formed eight years ago. People not only use it to communicate, but also as a source of entertainment through their games which are very popular. Morgan Stanley is supposed to be a leader in this deal and they could also benefit very heavily from this deal due to banker fees that could net them millions of dollars and also boost their image which could result in more clients.
Mark Zuckelberg, facebook’s CEO, is becoming of the great internet pioneers of his time and has positioned himself as a leading executive. He is the face of Facebook and has propelled it into an upper echelon company that has millions of users. In an internet age where social media sites are big, he has managed to penetrate the sector and position the company at the top. People used to use MySpace, but now they have clearly switched over to Facebook. It seems like it will be around for a while, but probably will decline eventually.
They have clearly gone through the introduction stage of the product life cycle and seem now to be going through the growth stage. Good companies that are innovative, have a good operations strategy, and a good leader tend to last long. Facebook is no Apple or Microsoft, but they still keep their position as a top company for a good amount of time. They are very innovative in their field and that is key in any sector of the internet. When do you think that they will experience their decline, if at all, and do you think that they will be able to recover and come back strong? The link of the article is found below.
http://online.wsj.com/article/SB10001424052970204573704577187062821038498.html?mod=WSJ_hp_LEFTTopStories
In the past few years, there have been many social networking sites such as Facebook and Twitter. “Social Networking” didn’t even exist in our vocabulary but now it almost defines our lives. Facebook has crossed the threshold, where it has become so significant in our every day lives and almost dictates the way we lead our lives online. So, I don’t think we should expect to see Facebook fall in the declining stage anytime soon.
As we saw with Google+, there seems to be very high barriers to entry for Facebook’s segment of social networking sites. The purpose of a social networking site is to, well, socialize. Although in order to socialize, there needs to be existing users. I don’t know if I would consider Facebook the ‘first mover’ to the industry, but they were without a doubt a founder of social networking sites. Since there existing users encourage new users, I don’t believe there market share will ever decline. Furthermore, they continue to find new ways to generate revenue, and in an age where information is king – the sky is the limit.
Facebook is site used to network and advertently plug new products. It has been very successful as you can see by the price that is was valued at, which is simply astonishing. However, Facebook is not immune to seeing decline. There are only so many people that can create accounts and I believe that they are very close at reaching their max potential. Additionally, there are still millions of people who don’t see any value or purpose in creating a Facebook account. So unless Facebook finds a way to reach the demographic that are still holding out to create an account then its potential will max out and may even see a decline in the near future.
Facebook has been around for almost 9 years and in these past 9 years we have only seen an increase in numbers for this corporation. Facebook is so successful because it is simple to use, doesn’t bring viruses, and is free to use. Many use Facebook to reconnect with old friends, advertise, and network. The only way the will ever experience a decline if there is a new social network that is even simpler to used than Facebook, for example Google+. Google+ could have taken over the social media if it wasn’t so difficult to use.
Everywhere i go, someone is always asking me to add them on facebook, or if im on Facebook. To friends-all the way to my mom. Facebook is our way of communication in the social world. it has evolved the way we communicate. Not only that but we live through facebook, if we invite our friends to a party or gather information it is through the social site. I feel as though if its running this strong for 9 years, as well has with the new innovative ideas that they keep coming up for the Face are always going to keep them at the top at what they do. 🙂
Great article Alan. I would have agree with the previous comments because Facebook make communication and networking with friends, family, and co-workers easier than ever. The innovative site has become such a big part of our daily lives that I don’t think people would know what to do without it lol. With that being said, I highly doubt Facebook would enter a declining stage. On the other hand, if FB did start to decline I think they would bounce back immediately with something better.
Nice post! I read another article a couple of days ago in Forbes and it was basically talking about what FaceBook is going to do with this great influx of cash. What I believe is that they are going to go down the same path as Google and start to cannibalize other smaller .com’s or tech companies and while that might look good financially, from a management standpoint they would be deviating from their product model. FaceBook is not in the business of managing a portfolio, they are simply the leading edge in online networking. While they basically took what was great from other companies before them and tied it all into their site, as of lately they have been falling off in popularity. I believe FB is “too big to fail”, they will not be the next Myspace. But I can definately see them moving along in the product life cycle floating into the Maturity Stage.
Awesome post, its crazy that in our society today we cant say ‘social networking’ without the terms ‘facebook’ and ‘twitter’. Its apparent that Facebook changed the way networking is done, and will continue to be the leader in social networking. There used to be a world without ‘Facebook’ but now we cant imagine a world without ‘Facebook’.
I read the same article and a few others supposedly naming Morgan Stanley and Goldman Sachs as the two front runners to underwrite their IPO. I read another article where they said that the Investment Banks might even cut their standard one percent fee just to be a part of the Facebook IPO. Anyways, I do think Facebook will start to level off. There isn’t really high barriers to entry in the industry, just really hard to get new users away from their current social network.
That is a good question. I think it will really depend on the success of Google+, which so far has seemed to sputter. I really think Google is the only company with the resources to take on Facebook in that aspect of Social Networking. It will definitely be interesting to see the change in Facebook when it becomes a public company.
I have to say that Facebook is losing some of its customers because now Twitter is gaining thousands and thousands of users every single day. Twitter is used by individuals for sharing the latest breaking news and updates as well as corporations for advertisements in order to increase their customer base. Corporations are also using Twitter to directly communicate with the customer to sell them its products and even answering all their questions. Therefore, Facebook is facing a very strong competition from Twitter and in my opinion Twitter will dominate the social media industry and will be become the leader in this industry.
For the 8 years it has existed, Facebook has strategically acquired small businesses that build up the Facebook experience and easily integrate into the social networking model. The company recently bought off the popular photo-sharing application Instagram for about $1 billion. As Facebook has grown, it only makes sense for the company to offer its shares publicly soon and allow everyone an opportunity to be part of the company’s success. The company’s investment bankers and public relations counselors are working hard to build up the hype and push up the IPO price. Facebook is aiming to raise up to $10.6 billion and is predicted to be the biggest IPO ever.
Facebook is still doing well, but I believe it started to decline slowly. The concept of Facebook inspired many of the new Social Media applications, except they are are trying to come up with something better.
Many people started to shift from Facebook to Twitter and other similar applications that are faster and easily accessible from portable phones. the new applications are more customized for users, photographers can communicate on “Instagram” while Businessmen may be more interested to use “Linkedin” networking application. Social media will keep expanding fast and Facebook will need to keep up with new technologies to maintain their fans.
Facebook redefined how people today interact with social media, and better yet, with their laptops, tablets, and even mobile phones. I agree with your comment that companies with sound leadership and continued innovations are bound to experience success, and Facebook has. While your questions asks if I foresee a decline in Facebook’s ever-presence, I think its shift into the creation of an IPO proves otherwise. Facebook is ready to reinforce its position as a leader of its field, especially with its $1bn dollar acquisition of mobile photo-sharing app Instagram. While Instagram, to some may have redefined how phone users interact with photography, Facebook aspires to buy out its competition in an attempt to integrate it within its own business strategy. Today, Facebook is more than just a platform where “friends reconnect”. Facebook, whether directly or indirectly, helps generate millions if not billions of dollars annually, through advertisements, company publicity via Facebook pages, contracts with telephone providers, etc.. Facebook is a leader in its ability to facilitate sharing information in an instantaneous and user-friendly manner, which is something that will be in demand, in my opinion, for much of the foreseeable near future. With the constant interface changes and “idea acquisitions”, Facebook maintains its competitive edge over its competitors (Tumblr, Linkedin, Twitter). In short, as long as Facebook is able to constantly reassert itself against its competition, and it is, it will experience at least a few years of growth.
For the last 10-5 year’s life style has changed, I would say especially here in the Middle East. Our culture is more of keeping in touch, visiting the family..etc with the boost of the internet, mobile phone (SMS, BBM and MMS) and social networking websites, that strong bound we used to have became weaker! However; today people are more used to the modern technology, they are enjoying it too. Facebook brings everyone around the world on the same page, which is a great advantage. The idea of posting comments and sharing pictures made Facebook the newspaper of people’s social life, for example I only know when an old friend got married is by checking the status on FB.
On the Other hand, and from my point of view Facebook is now declining, people are more considered with Twitter, especially with the current political tension around the globe. Between time to time Facebook creates a new application or innovates a certain idea, but what I think is that some group of people lost the spark of interest they already had for Facebook.
Facebook without a doubt was a revolution in the past decade, as it has lived up to its expectation,
it was truly a market leader in the social media industry, people got connected, even though they were not in communication for long time, it has bridged the gap among masses. But since every product has a life cycle, facebook have also gone through the same experience. It has seen development, growth and now is the time for decline. You must have observed carefully that now people are reluctant to use facebook as their privacy is threatened. A lot of folks have just deactivated their accounts because of their identity theft and privacy danger. Even though facebook have tried their utmost to keep it up to the market by improving security features, but failed miserably, and probably this will lead to its sad demise, if they do not improve their security features. More recently the introduction of timeline profile has created a little impact, which resulted in reversal of its customer base but anyway it is not rigorously hiking.