Microsoft to Buy 5% of Facebook Valuing at $10bn

l-ascorbic writes "The Wall Street Journal is reporting that Microsoft is poised to buy 5% of Facebook for $300 million to $500 million, valuing the company at up to $10 billion. Microsoft already handles advertising for the site."

$10 billion

[Anonymous Coward]

$10 billion for a site that has 34 million active users ~= $300 per user. Hmm. I think this site is highly overvalued. But let MS waste their money if they want.

Well, that's one way to get Silverlight adopted...

[mad.frog]

...just require 34 million active Facebook users (who are probably mostly young, rabid web users of other sites too) to install it.

How long till we see some cool new site feature -- or, hell, even an existing, basic feature -- reworked ("enhanced") to require Silverlight?

Re:

[betterunixthanunix]

About the same amount of time for them to switch back to their old DHTML code, when the new code stopped working on some browsers (including my browser).

Re:Well, that's one way to get Silverlight adopted

[LWATCDR]

You forget. Microsoft can just push silverlight as a update for IE.
Unlike Slashdot only 5 or 10 percent of Facebook users use firefox.

Re:Well, that's one way to get Silverlight adopted

[GregariousBoson]

I don't see it happening. 5% is a far cry from majority shareholder. Especially if Google and other companies are buying in, as other folks have written. My (optimistic) guess is that there's no hidden agenda. Can't a company just invest in another company that looks promising?

Re:Well, that's one way to get Silverlight adopted

[19thNervousBreakdown]

Can't a company just invest in another company that looks promising?

Yeah! And can't a crackhead just admire your car stereo?

Re:

[Freexe]

Didn't people say the same thing about Google, Myspace etc... They are all turning into money earner in this new digital landscape.

The potential of these sites to become long term hubs for people to visit has got to be worth the few million MS is dropping into it.

Re:$10 billion

[Chineseyes]

The problem is that sites like myspace and facebook ARE NOT long term hubs for people to visit. They are trendy sites, back in '99 when I was in a freshman in college the place to go was blackplanet, mi gente, Asian Avenue, and livejournal. After these sites it was friendster which was ethnically all inclusive. Now the new trend is myspace and facebook. All of these social networking sites are just fads and when something that looks better comes along everyone will abandon myspace/facebook/whatever and start aggregating friends somewhere else.

Re:

[PeelBoy]

Good point. Similar to bars and clubs.

The "White Pages" for eMail

[willy_me]

I've come to see Facebook as being the "white pages" for eMail. People change their eMail addresses constantly - usually due to changes in employment or SPAM overload. What is needed is a way to find your friends current eMail address. This is the role that Facebook serves. If I need to send a message to a friend I can just use Facebook and it matters not how they have changed their eMail.

I'm not suggesting that this is a perfect solution but it does help explain the popularity of these sites. It is the reason why I joined Facebook.

Willy

Re:

[fistfullast33l]

I'm sure the editors [zawodny.com] here would disagree [kottke.org].

Re:

[Tmack]

Umm, no.

There is a huge difference between trendy sites back in the 90's and the sites now. I was a frequent internet user as a high school student back in the 90's, and I've never even heard of those sites you mentioned except for livejournal, and I don't think I've ever actually visited it. All that stuff was before the .com bust. Every one and their grandma was trying make trendy websites. And that's why the were just trends. Those websites you mentioned were minuscule compared to myspace and facebook today. FaceBook and MySpace are worth billions of dollars. Something worth that much isn't going to disappear in a few years. They are growing and are continuing to grow. I think most people would rather go to the networking site all their friends are on, even if there is something else better out there. Maybe in a few decades or generations, another website will take over. But most likely, a corporation will just by myspace or facebook and change the name.

Tell that to friendster....

Tm

Re:

[Chineseyes]

There are a few problems with your argument, first a large portion of the users who were on Friendster migrated to Myspace and currently there is a mass migration of users from myspace TO facebook. Googling [google.com] the growth trends of myspace and facebook currently show myspace is losing users to facebook. In fact there was one article I read that showed myspace growth is slowing at the same rate that facebooks membership is growing. Sometime in the near future it will be another site growing while facebook dec

Re:

[psbrogna]

I think think your term/concept "long term hub" is the issue at hand. At any one time there's a whole bunch of "hubs" jockeying to be "the one." As the web evolves I think it's always going to be easier for somebody to jump to the front of the line and leverage cool stuff that older sites (that've already achieved wide spread adoption) will take longer to integrate. The leap frogging phenomena exists in many forms across technology. So the valuation of these critters is a dicey prospect: one component of th

Re:$10 billion

[Hanners1979]

Microsoft calculated the cost per user of these shares in Excel 2007, and found that every user of Facebook would pay them several thousand dollars.

Re:

[neoform]

Sale value != Yearly Income.

It's very possible that over the next 10 years facebook can bring in $300 per user.

Many companies sell for 10 times what their yearly revenue is.

Revenue Multiples

[sjbe]

Many companies sell for 10 times what their yearly revenue is.

Only if they are highly prospective ventures with a large potential upside, little/no earnings and possibly purchased during a speculative bubble. Most firms are purchased for between 1X and 2.5X revenue, or 5X to 8X EBITDA [wikipedia.org]. Any multiple over 3X revenue is a very rich valuation. 10X is purely speculative and the buyer had better hope they have the next google on their hands if they want to get any profit from the investment. Last time we saw

Re:

[bloobloo]

Let's look through the DJIA, easily seen on finance.yahoo.com:

Alcoa's price:earnings ratio over the trailing twelve months is 14.27
AIG is 10.93
American Express is 17.89
Boeing is 22.45
Citigroup 10.53
CAT 15.5
DuPont 14.04

Microsoft's own ratio is 20.67

It goes on like this. Now obviously this is only one aspect of valuation: the industrial majors are likely to have a much lower price to book assets ratio than facebook has, but a 10:1 P:E ratio is far from unlikely.

Earnings are not the same thing as Revenue

[sjbe]

...a 10:1 P:E ratio is far from unlikely

Earnings [wikipedia.org] are not Revenue [wikipedia.org]. Earnings are profit. Revenue is total sales. It's VERY important that you understand the difference. Companies are not valued based on their P/E ratio. The only real use of a P/E ratio is to determine if a stock price is relatively high compared to similar companies. It tells you nothing about how much the company is actually worth. The market capitalization [wikipedia.org] can be important (if the company is publicly traded) but the P/E does not give

Re:

[bloobloo]

The gp talked about "revenue" of $300 per user over 10 years. I interpreted this as in fact referring to earnings, given the context. Obviously price:turnover would be much lower than P:E.

As it is, I also would not invest in tech stocks such as these (except where they fall in my tracker, but as most are US rather than British I don't have as much exposure there)

Looking at your figures, with $150k EBITDA, let's allow say 50% tax, interest etc for a profit of $75k. Discounting at say 7% per annum real value

Re:

[sjbe]

Basically we are saying the same thing but your correct use of revenue vs my use in the gp's terms got in the way!

Fair enough. It's an unfortunate reality that in general in the finance world people are too loose with definitions. Drove me nuts when I was first learning about all this in school. You seem to have the concept down but there are a LOT of people who really just don't grasp the difference between revenue and profit. I try to educate where I can to help.

Re:

[Silverstrike]

No no no.....

You're making the same mistake as TFA.

There's a declining net aggregate utility in owning share in the company. A sharply declining one too.

The first 5% might cost them $300 million or whatever, the next 5% significantly less, etc.

Its not a linear function, and therefore, you can't make the leap to "Facebook is worth $10 billion, and each user $300"

Now, that said, I agree no matter what, its still wildly overpriced.

This feels like 1999 all over again

[Paktu]

How the hell is Facebook worth $10 billion? Less than a year ago, they were estimated to be worth $1 billion...does anyone seriously think this site can bring in real revenue?

Re:

[betterunixthanunix]

Well, they have millions of users, who are fed ads with every page request. I'm pretty sure that they are making a lot of money -- or else Google wouldn't be doing so well either.

nope

[Quadraginta]

TFA itself says that Facebook themselves expect to rake in a piddling $30 million profit on $150 million revenue this year.

Re:This feels like 1999 all over again

[monk.e.boy]

How the hell is Facebook worth $10 billion?

Repeat after me: BUBBLE

Next month it will be worth ONE HUNDRED BILLION DOLLARS, and the month after it'll be worthless.

Re:This feels like 1999 all over again

[jollyreaper]

Repeat after me: BUBBLE

Next month it will be worth ONE HUNDRED BILLION DOLLARS, and the month after it'll be worthless.

I believe you mean "Bubble 2.0."

Oh, a social bubble. We should call it Bubblr.

[Glytch]

Maybe this time around we can crowdsource a Web 2.0 revenue model to capture all those eyeballs, and implement it on a scalable platform using best-of-breed licensed and open source technologies.

Re:

[jollyreaper]

Maybe this time around we can crowdsource a Web 2.0 revenue model to capture all those eyeballs, and implement it on a scalable platform using best-of-breed licensed and open source technologies.

I feel like slapping you. Well done, sir, well done.

Re:

[CodeBuster]

I agree completely with the parent, this is most definitely a Bubble. There is no way that the underlying technology of facebook (CSS, HTML, PHP, Apache, and MySQL or Postgresql) or the ad profits that it generates has a present value greater than ten (10) billion dollars. The source code itself, which was leaked a couple months back, appears to be rather mundane stuff (not the best example of quality PHP coding, but then again not the worst either). The only things stopping a potential competitor are new a

Now you've done it

[Bloke down the pub]

Shhhhh!

P.S. I've got some shares in Northern Rock - sounds like a solid investment, eh - now I would hang on to them but my daughter's getting married and I need the cash in a hurry...

Re:

[SatanicPuppy]

Well, you have 34 million users, so theoretically they must be worth something if you can leverage that for advertising or something.

Not 10 billion though. If you started charging your users for special features you could start pushing toward that, but as long as you're relying on ad revenue you're screwed.

It's like cable, or newspapers...The ad revenue is what people talk about, but the bulk of the money comes from subscription fees! Advertising is just the icing on top. The reason you pay 100 bucks a mont

Re:

[everphilski]

Well, you have 34 million users, so theoretically they must be worth something if you can leverage that for advertising or something.

Yeah, but not all 34 million are active. I'm one of them ... I check it about once a month for 5-15 minutes. Once you are out of college for a few years its really just there to get the contact of a former colleague if you need it. Assuming they kept it up-to-date.

Re:This feels like 1999 all over again

[SatanicPuppy]

Seeing as I'm currently in charge of the financial systems for a medium sized newspaper who puts all their content online as well, I think I'm in a better position to say how much money comes from what.

We get dick from online. I mean, it's like joke money. Maybe a hundred thousand a month...more on a good month. Retail ads are 20 times that, and classified more still. Actual circulation revenue, including single copy which is pretty expensive compared to a subscription, is well into the millions and that is money that comes in every month, like clockwork. Sure, on Thanksgiving you're pulling in enough ads to double your circulation money, and Christmas too, but then there's the rest of the year.

The problem with newspapers is that the actual process of creating and delivering the paper is a huge time and money sink. Despite that we're still running a solid profit, though as many people point out, it's shrinking. Online is obviously the answer to a prayer...we could afford a HUGE drop in ad revenue and still make a profit if we could close down the print product. But as it stands with online advertising, it's still not profitable enough to think about that.

Re:This feels like 1999 all over again

[SatanicPuppy]

Well, IMHO, since I don't have any actual say in this stuff...

1) They're stupid. They whore out to doubleclick, etc, just like everyone else instead of doing quality chosen local ads that they could pitch to their local advertisers for better rates. They're slowly overcoming this problem, and ad revenue is increasing.

2) Most newspapers are still working their way into the whole "web" idea. I mean, print media produces more actual web-friendly content than most industries, and, even better, it has a short shelf life, so they have nothing to lose by putting it on line. Do they take advantage of this? No. they put it up for a few days, then take it down.

This is hilariously frustrating if you know anything about the web, because you know that it's not whats there right now that's valuable, it's whats there in total. Newspapers in particular are sources for immense amounts of detailed information about things in their coverage area, and while it's utility is pretty limited in the usual archival forms (e.g. Microfiche) it would be astoundingly useful if they just left the content up to be indexed by search engines. Couple that glut of content with some advertising, and you've got an archive of data that costs very little to host and will bring in ad revenue every time someone finds something relevant in your coverage area.

At some point the big media companies (Gannett, McClatchy, Media General, etc) are going to realize that they're sitting on an informational goldmine and start actively leveraging that information to draw people to their sites. Right now it's all the aggregators (like Slashdot, Digg, Fark, etc) who are picking up the burden of providing the relevant information to the interested parties, because print is stuck in the whole, "Barf up a bunch of content and people will come" mentality. That will eventually change.

3) They still think in the back of their minds that if they put together a really good online component, they'll kill their bread and butter print product. This is, at heart, stupid. People thought television would kill print too. We still don't have a good portable disposable medium that will take up the slack, and moreover, there are a lot of people who are just wedded to the idea of the physical paper. That's going to be the case for decades to come, and that's a conservative estimate.

This means that they don't put enough real resources into online. I could give you numbers that would make you laugh your ass off, I mean seriously embarrassing. The people who are doing it are reporters, but not the good reporters...You get Peter Principle crap, so the reporters that end up doing it are people who can be spared to do it, and they have no special training, and no technical competence, and all too often, no fricking IDEA of what they should be doing...Just a very limited idea of what the hell the web is about.

Again it's just incompetence, and industrial blindness. Random example. You pay a professional photographer a daily wage. You send him out to cover a fire, a little league game, and a miss toddler usa pageant. He takes (conservatively) 500 photos. Of those 500 photos, maybe 4 make it into the paper, some probably in black and white. The rest are discarded. On the off chance that any picture will be used in the paper, the photojournalist has secured (in advance) the names of the people in it.

Can you imagine the kind of photo galleries you could create with that sort of information? Cheap to host, simple to index, throw some ads on it...Profit!

Print will die, but the content will live on. They need to transition that content to a digital forum, and then show the world what they really collect. The sheer volume of information has to be trimmed down to fit in the available space...What if there was no space limitation? Take every newspaper website, and, instead of making some ephemeral short term shallow content, make it like the tip of an iceberg, provide what you pay to collect already, and let people dig through it.

Sigh.

This is obviously and old and polished rant. You can guess how seriously they take my opinions...I'm just a techie after all...What do I know about newspapers? =P

Re:

[Duncan3]

Study after study shows the Facebook demographic completely ignores ads, doesn't even realize they are there, or even run adblock plus.

That means Facebook is worth almost nothing. The advertisers haven't caught on yet tho, they aren't exactly the type that real research studies ;)

Re:

[Dunbal]

That means Facebook is worth almost nothing.

      It's worth whatever someone is willing to pay for it. If Microsoft figures it's worth $10 bn, then it's worth $10bn. Of course, I won't argue that MSFT might be making a huge mistake, but huge mistakes can just be written off anyway... It takes balls to take risk, and risk doesn't always pay off. But when it does, it's well worth it.

Re:

[jimmyhat3939]

You are exactly correct.

Typical Financing

[mpapet]

This kind of financing is the ultimate pyramid scheme. Totally legal too.

Step 1: Sell the first tiny bit of a company to someone for $100.
Step 2: Sell the next tiny bit of a company to someone else for $1000. You can casually drop impressive phrases like, "My investors..."

Rinse and repeat minimizing losing control of the company.

Given the amount of wealth held by the top 2% in the U.S., this kind of private placement financing will be quite the norm going forward. Another reason why income and wealth dist

Re:

[davidsyes]

Maybe mshaft is going to change the user terms of agreement and grant themselves the "right" to sell our information, profiles, and more. Or, they're trying to angle in on us to make us addicted to their upcoming products/services.

Looks like I'm going to start back editing my postings to be "copyrighted material" and dare fb or ms to remove it from my postings. Looks like I'll have to prepare to find another social networking site and minimize my use of fb... maybe...

Re:

[minuszero]

...and let us not forget the value of being able to personalise the ads as easily as facebook could allow for (they can arguably know you better than you do if you fill in enough of that info section).
Targeted ads are worth far more than non-targeted, for obvious reasons.

that would make $ 294 / user!

[dermond]

wikipedia reports 34 million users. this would it mean $294 per user... sounds a bit overpriced to me..

Re:that would make $ 294 / user!

[AcidLacedPenguiN]

I think instead they should just buy every user an Xbox 360. . .

Re:

[Red Flayer]

Well, there's a handy chart in TFA that shows Facebook as having 69.3MM unique visitors in August 2007... this figure is more relevant to ad impressions and click-throughs than number of users.

Re:

[MobileTatsu-NJG]

"wikipedia reports 34 million users. this would it mean $294 per user... sounds a bit overpriced to me.."

If the growth has been rapid, then 34 mil today could be 50 mil in a few months. And even more down the road.

Re:

[NickCatal]

Wikipedia reports it as "MIKE IS GAY", what does that make it worth?

Re:

[ivan256]

Either that or they're fairly convinced that owning 5% can give them much more than 5% influence.

Re:

[ivan256]

Right.

5% is enough to guarantee that they'll keep using ads from Microsoft, and probably enough to get them to embed some technology that Microsoft wants to embrace and extend. We all know that Microsoft is willing to spend billions to buy into new markets with minimal merit, so getting equity for their buy-in is a bonus.

Noooooo!!!!

[onosson]

Maybe if we all *poke* Bill Gates, we can get him to stop.

Google is already poking him

[Julie188]

Here's a story also that adds that Google is talking about investing in Facebook [networkworld.com]. Makes it sound like Microsoft's move is just another way to get back at Google. (Did you know Microsoft has started a "consortium" to try and block the Google/Doubleclick merger [networkworld.com] -- only no other companies will join so far?) Another tug-o-war between the two and Facebook developers wind up rich? The reports sound like nothing more than rumors, even if they do come from the WSJ.
--
Microsoft Subnet -- the independent voice [networkworld.com]

Re:

[mpapet]

I would add to your argument the magic number is probably some small amount of cash and lots of software licensing. Companies love to do this kind of deal and make the numbers look really big.

Re:

[teslar]

Well, amusingly enough, he does seem to exist [facebook.com] on Facebook. In the Microsoft network, plenty of friends at Microsoft, it might just be the real thing.

Re:

[davidsyes]

Nah... do a Super Poke, then transform it by a Spoonerism...

Pooper Soak..

Hopefully not

[Rik Sweeney]

Mark Zuckerberg would like to keep it independent apparently.

In any case, register your complaint by joining this group

http://www.facebook.com/group.php?gid=6197556554 [facebook.com]

Everyone knows that joining a group on Facebook can move mountains and change the world...

Re:

[sepluv]

You forgot all the copycat groups, because, as everyone knows, even if joining one facebook group on the issue won't help, joining loads, just might!

• Don't sell facebook to Microsoft [facebook.com]
• Don't let microsoft buy facebook [facebook.com]
• I *WILL* Close My Account if Microsoft buys Facebook! [facebook.com]
• Don't sell Facebook!!! [facebook.com]
• I'm Leaving Facebook if Microsoft Buy It [facebook.com]
• Dont sell 5% of Facebook to Microsoft [facebook.com]
• Don't sell out Facebook! [facebook.com]

...and, of course, the obligatory:

• FACEBOOK IS A SELLING-OUT!!! DISCUSSION BOARD!!! [facebook.com] (with added c

Re:

[griffjon]

I zeroed out my MySpace account when Fox bought it, it'd be a shame to have to do the same with Fb.

Scrabble

[LordSnooty]

As long as I can still play Scrabble, I don't care!!!1

Actually, this input from Microsoft might help to fix the problems that Scrabulous seems to suffer every day... right, gang?? As you can see, I only use Facebook for Scrabble. There must be a group for me.

I can't wait to see pictures

[duppyconqueror]

of Ballmer and Gates doing Jello Shooters at a rager.

Re:

[Dunbal]

No one does Jello shooters anymore. At least not in that tax bracket. You get people to drink them for you, while you smirk at them over cognac and caviar.

How many real users?

[vux984]

Great. Just another reason not to use facebook.

As for the number of users, I wonder how many of them actually USE facebook, vs simply having registered in order to see someone elses crap. I know a lot of people who've been roped into 'signing' up to these sights in order to see their cousins christmas pictures, or to rsvp to a wedding shower where the idiot hosting it sent out the invitations via facebook.

So far: I don't have a facebook profile; I don't want a facebook profile; and I'm dreading the day where I have to get a facebook profile because I need to see someone elses effing facebook crap. I just know that sooner or later an important client is going to send me a facebook invitation that I'll -have- to register on the site to properly respond to...

I hate social^H^H^H^H^H^H viral networking sites.

Re:

[HarvardAce]

As for the number of users, I wonder how many of them actually USE facebook, vs simply having registered in order to see someone elses crap.

According to Wikipedia [wikipedia.org], 60% of users log in at least once per day. This number is probably a little old (my guess is the number has decreased as more and more people have joined), but even at half that number it is still impressive.

Micro$oft? Facebook?

[Mr.Fork]

Hey! If I add Gates and the rest of the MS staff, I can start using my Star Wars Jedi plugin and start using the force on them! Maybe even recruit some of them to the Jedi Linux side! I think Darth Gates might be a tough opponent though his minions will be very easy to manipulate..

"These are not the code bugs in Vista you are looking for" could have a whole new meaning... :)

They must have asked Rupert Murdoch's advice

[Random BedHead Ed]

I'm sure Steve Ballmer discussed this with Rupert Murdoch over drinks.

"So how are profits from your MySpace purchase, Rupe?"

"Oh, well ..." said Murdoch, looking nervous. "Actually, great. Great! It's going to be worth billions real soon now." He laughed icily at his own irony.

"Really? Because we were thinking of buying a stake in Facebook at Microsoft."

"Oh, you should totally do it," said Murdoch, grinning wildly.

"Yeah, we thought the developers would love using it on a sort-of group connection to MSDN."

"Do it! There's nowhere for these social sites to go but up."

"And we're thinking of extending the Welcome to the Social campaign to include it."

But Murdoch was laughing to hard to hear the rest.

Hate to spill the beans, but...

[weston]

There's already a few companies who've realized that social promotion is a significant under/untapped advertising/marketing opportunity, and it's going to get bigger. It may not always be MySpace and Facebook where it happens, but the companies that build tools and gain expertise in it are going to see some real success.

I think it took a media guy to understand this. MySpace is actually a "social channel" of sorts... a kind of new entertainment media all its own. Like Fox or NBC it may not always be on top

buy people

[kurtis25]

Face it we are being bought and sold like cattle. In this case MSFT is buying a place to plug in their future office live apps. A few updates down the road you will see the edit interface look like office live. This will mean that thousands of people are getting used to a MSFT product on Facebook and will use office live when they have to decide where to type their next document. Let's say Google buys Slashdot and changes the Post Comment screen to a docs.Google style screen (with awesome presentation style comment ability) then when it comes time to choosing a Word Processor in 3 years I'm going to choose docs.Google since I've already been using it on Slashdot and you will make the same choice. So this 5$ share is nothing more then MSFT buying future customers. They didn't buy the farm for the land they bought it for the cattle. ---- Mooooo....

Re:

[nuzak]

I want the minute of my life that it took to read that back.

Hell!

[thatskinnyguy]

Mark Zuckerberg is the Steve Jobs of our time! He's 23 years old and worth billions! Same as Jobs back when he was Zuckerberg's age. It just goes to show, if you're enthusiastic and driven, and you have an idea to satisfy a need people don't already know exists, you stand to make billions!

Re:

[Anonymous Coward]

Unlike Zuckerberg, Jobs actually innovated and evangelized real technology. Facebook rehashed a viral formula in a niche market and grew it successfully. Facebook is valuable because the site is popular, but this can change on the whims of a user-base. Facebook has made no significant technological contribution to the internet and overvaluing popularity is a huge mistake for long-term investments---it's almost like we don't remember 1994-2001 anymore.

Oh, goodie ...

[the bluebrain]

... then we can expect similar groundbreaking, innovative improvements as we saw when hotmail was microwashed.

valuation credits

[psbrogna]

So... Dr. Evil is doing due diligence for MS? Who knew.

Facebook is nicely done

[hey]

Facebook is nicely done. They keep everything lowkey. No blinking, no spam, etc. They appear to respect user's privacy.
Its what users who aren't children want. That is one of the reasons it got so many users. Well, that and the network effect. But niceness certianly helps. Of course, Microsoft knows nothing about making an application low key and pleasant to use.

Re:

[Burz]

Yeah, which is why they encourage their users to enter the email addresses of all their friends and family.

Did you know that I have a facebook profile, without ever previously visiting their site? So now I have to sign up myself to find out what this profile says about me!

It's like automated blackmail.

Re:

[onosson]

Yeah, which is why they encourage their users to enter the email addresses of all their friends and family. Did you know that I have a facebook profile, without ever previously visiting their site? So now I have to sign up myself to find out what this profile says about me! It's like automated blackmail.

He said they respect users' privacy. He didn't say anything about non-users.

Re:

[Burz]

It doesn't matter to me whether a users' privacy is invaded before or after they give in and sign up.

This usually means MSFT broke a law

[WillAffleckUW]

or infringed a patent or other IP - they tend to pay off by buying shares - when you have a small firm "potentially" worth billions, it's hard to get cash sometimes.

Remember Borland and other such "investments"?

Facebook is the future

[rinkjustice]

According to the latest ish of Wired magazine, Facebook has 40 million active users (real people and not sock puppet accounts, thanks to the fact users can only view other's profiles upon confirming relationships) who generate more than a billion page views a day. Lately, Facebook has also been signing up 1 million new users a week.

Facebook also has that supercool Newsfeed feature which aggregates the latest activities on friends, family and associates, and manages to connect people who haven't seen each other in twenty years. Admit it, it's like nothing we've ever seen before (Myspace shouldn't even be in the same category).

I'm not a Facebook fanboy (alright, maybe I am), but I marvel at how well its connecting people in meaningful ways. It's a social universe within the internet. It's going to be bigger than money, because of it's worth and usefulness to you and I.

I don't like Microsoft one ioda, but they made a smart move here.

doesn't support standard email address

[dwater]

I've refused to use Facebook (despite some pressure from friends) since they won't allow me to use my chosen email address, despite it being perfectly standard.

The problem is that I use 'plus addressing' (eg [e-mail]) and their email validation scripts has a bug that claims it is invalid. It's not uncommon for validation scripts to have this bug, but most web sites are happy to find the bug and fix it. Not so with facebook - my impression is that they're just a little bit arrogant. So be it.

Yeah, I could not use plus addressing, or use some other account, but it hasn't got to the point where I want to bother yet. It's still annoying though.

Re:wow

[betterunixthanunix]

Probably because it would cost so much for FB to migrate to .NET (or any application server). Think about how much traffic FB gets -- now think about how much extra hardware they would need to aquire to switch from a CGI-esque technology like PHP to a big and heavy AS like .NET, let alone the man hours needed to recode everything.

Re:

[hellsDisciple]

Facebook runs pretty snappy - begs the question of are many other projects using ASP.NET, JSP or other heavy duty systems where PHP on Commodity hardware would scale well. In any case I will be leaving if MS buys facebook.

Re:

[Anonymous Coward]

In any case I will be leaving if MS buys facebook.

Sure you will. Right after you meet that lass in a pub that wants to be your "friend...." ;-)

Re:

[jimstapleton]

Odd, I've looked at ASP, from a code perspective, it doesn't seem exceptionally different from PHP. Like someone tried to combine PHP and C# or VB.NET.

Re:

[betterunixthanunix]

Yes, from a code perspective, PHP and ASP look very similar. But from an execution perspective, they are not. PHP is basically run like a CGI program (I am speaking from an Apache perspective here) -- when you request a PHP page, a process is forked off that executes the PHP program, and STDOUT for that program will be the web page that is returned. This is sped up with mod_php, but the basic model is the same: a process is forked off to handle your request. It is a very lightweight, UNIX-esque model,

Re:

[Anonymous Coward]

Um, not really...

Even with the mod PHP processes are hogs. However, no licensing costs. The .NET subsystem is extremely fast, but the $$ builds fast as you add machines.

Re:wow

[mrdaveb]

Quite impressive that PHP was able to model itself on Microsoft software that didn't exist yet

Re:

[Rik Sweeney]

Plus, Facebook uses Java to upload its images and Flash to play the videos.

They'll be replaced with .NET and Silverlight.

Oh, and kiss goodbye to the mail account that you've registered with Facebook. Spam ahoy...

Re:wow

[moosesocks]

I know your post was sarcastic, but any mac users dealing with the agonizing slowness of their photo upload applet should be cheering for joy if what you're saying is true.

Flash on Mac isn't all that hot either. Adobe's more or less been shitting all over the platform ever since Apple started directly competing with them. A single Youtube video can easily suck up 80% of the CPU cycles on a modern Core Duo machine.

As long as the number of competitors remains small (ie. 2), I think that Silverlight will actually boost the quality of web applications on ALL platforms.

Java's had its time, and frankly, while it's found niches in other fields, it sucks for web applets. Java applets need to disappear into the ether, resting alongside VRML. (Facebook IS in a pickle, because at the moment, Java probably is the best solution for multiple photo uploads...)

Re:

[daveschroeder]

I know your post was sarcastic, but any mac users dealing with the agonizing slowness of their photo upload applet should be cheering for joy if what you're saying is true.

Flash on Mac isn't all that hot either. Adobe's more or less been shitting all over the platform ever since Apple started directly competing with them. A single Youtube video can easily suck up 80% of the CPU cycles on a modern Core Duo machine.

You do know about the official Mac OS X-native FaceBook Exporter for iPhoto [facebook.com], don't you? It's th

20002 called.

[C10H14N2]

Sun was actively discouraging the use of applets over five years ago. The use of Java on the web has since been almost entirely server-side. There's no reason an applet is necessary to perform a binary upload. See Google's file attachment method as an example and Jakarta Commons FileUpload as the likely back-end to what is little more than a standard multipart form submission.

Just because the people implementing the technology suck doesn't mean the technology itself does.

Re:20002 called.

[Xtravar]

There's no reason an applet is necessary to perform a binary upload.

Facebook resizes the photos before uploading them.

1. They are saving a ton on storage and bandwidth by doing this.
2. They are saving a ton of Sally's bandwidth by doing so (since she has 800 pictures of her and her friends drunk on Facebook).
3. They are saving a ton of Sally's stalker's bandwidth (who would inevitably download all of her photos in hi-res).
3. UI: Users can easily browse to and check off which photos to upload, with thumbnail previews, which is much nicer than any other non-Java upload system out there.

They do, however, have a HTML form fall-back in case you don't want to use Java. But frankly, it is the most convenient, transparent, and well-designed Java applet I've ever run into. In fact, I'd hypothesize that Facebook's photo system is a success precisely because of the Java applet.

Re:

[Anonymous Coward]

3) They are also making Sally's stalker upset because he WANTS the hi-resolution photos. Sally's stalkers lose out completely, and considering a large amount of us on slashdot stalk Sally, it hurts expecially bad.

Re:

[moosesocks]

Unless I'm missing something, uploading multiple files in google isn't exactly a Shift-Click sort of affair. Each file needs to be selected separately -- 4 clicks minimum per file, probably more.

When you're uploading 60 files like you would frequently do on Facebook, this becomes a HUGE hassle. Plus the thumbnails and check-marks are nice for users who have Operating systems that don't make thumbnails available in their file-chooser (or for those who do, but don't know how to use it)

Re:

[Bill, Shooter of Bul]

Its sort of funny that myspace is so Microsoft loving ( .NET and SQL server), but facebook the Lamp Champ is the one now partially owned by MS.

Re:

[gtall]

Looked at another way, myspace has already been borged, Microsoft is merely corralling more sheep for branding.

Gerry

How are you gentlemen?

[Moderatbastard]

All of your face are belong to us.

Re:wow

[timmarhy]

i smell another dot com bubble rising.

there's no way facebook is worth 10billion. they dont' produce anything.

Re:

[Nullav]

Because it's an internet pissing contest for ad revenue. You don't have to produce anything as long as you can make your site popular and make the corporate monkeys think that people actually click on ads.
It really looks like another bubble, but I can't help but wonder how long this could go on. After all, most of the people throwing the money around are already rooted deeply into the ground and wouldn't suffer too much if their investments went bust.

Re:

[LWATCDR]

I got on with just an email account from college. I haven't been a college student since the Commodore 64 was a good computer and the Amiga was cutting edge.

Re:

[ShatteredArm]

Though I really despise the ridiculous amount of profile clutter some of the more myspace-y users have, I don't think their opening up is a bad thing at all. Yeah, I was able to connect with a few people at my school and whatnot before, but after opening up, I was able to connect with far more people. Not everybody I know goes to school, and the increased universality seems to have compelled some of my friends who do go to school who hadn't joined previously to join. And thus far, Facebook has avoided so

Re:

[sepluv]

wouldn't want my money within a thousand miles of that "F*** the Jews" facebook group

Well...your money won't be because the evil Jew bankers have it all and they are using it to bring in the New World Order.

Note to Mods: That was supposed to be funny.

Seriously though, you (the parent) might actually have a reputation to tarnish unlike the prospective puchasers of Facebook (Microsoft and Yahoo)...

Re:

[Kobayashi Maru]

I'm all for low-brow off-color humor, but there comes a point where a joke, even stated "ironically," isn't funny. Yours isn't funny, and it's because it lacks context. Over half your post is devoted to an inappropriate joke that doesn't have anything to do with your point. The fact that you have to throw a disclaimer in there should have been an indication that it isn't funny. Racist humor can be funny (in my opinion), but not when it's delivered like a knock-knock joke.