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by bilbo0s
6950 days ago
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Actually, Facebook generates a great deal of revenue via advertising. That said, I will concede that the ad based Web 2.0 business model has yet to be tested in an economic downturn. This is something that could leave a Web 2.0 company at the whim of unscrupulous hedge fund managers in the public markets. If their revenue proves to be susceptible to downturns, it will be a less than happy time for Bay area employees. Still, perhaps these companies will be able to come up with a new revenue generating product line. I know that most Web 2.0 entrepreneurs can trot out a list of other "business models" a mile long. However, the issue with them is that they generate revenue in the millions in 'best case' scenarios. What the markets would be looking for is revenue in the hundreds of millions, or billions. At a MINIMUM tens of millions in the 'worst case' scenarios. I think that Facebook has the best chance of ALL of the Web 2.0 sites to make a run at the public markets. Maybe they can charge the users for access later. Or perhaps they can charge all of the developers for access to the platform API. Maybe they will make contracts with advertisers that span YEARS while the internet ad boom is hot. That way they will still have money to get them through to the next ad boom. There are a lot of things they could do. |
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Maybe Facebook is even more clever than I gave them credit for. What if they use the platform to stage different features, all implemented by different companies, and some of these companies are WILDLY successful in charging a price for their product. Facebook could buy these companies or replicate the services and boom, they have another revenue line.
Shady, but it works.