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China Wants To Buy Facebook Stock

blogs.forbes.com

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Re: China Wants To Buy Facebook Stock

#11

Post by nextparadigms »

tatsuke95 wrote: post #8
pavel_lishin wrote: post #4

> A billion-dollar investment does not buy much influence in a site expected to be worth a hundred times that when it goes public. Really? Facebook is going to be worth a hundred billion dollars?

Give or take, that's the latest figure being tossed around. I believe the last second market buy-in was at a valuation of $87.5 billion, and that was in May (someone correct me if I'm wrong). Adding 10s of billions of implied market cap a quarter. The bubble knows no bounds. Interesting product, interesting stock. Regardless, does anyone else think this is going to go down as the biggest tech stock blunder in history…

Last one was $70 bn. It dropped from about $85 bn. Even $70 bn is way too much for Facebook. I think their valuation grew more like a Ponzi scheme. Everyone thought it was going to have a higher value, so they invested more in it and told others about it.

I remember it grew a few tens of billions basically overnight with bit tech sites claiming "..and Facebook's value grew another $5 billion this week".

I think its value will start dropping fast by the end of the year, especially now with Google+ gaining traction.

Re: China Wants To Buy Facebook Stock

#12

Post by esrauch »

mef wrote: post #10

The article confusingly states first that China's stake would not be influential, and then states that the apparent reason for China's interest is to have "control in the long run". Even if China's stake was influential, why would they need it in order to censor Facebook? They censor plenty of sites in which they have no stake whatsoever.

They are currently only able to completely block the website from China. If they can get an influential stake then they can have it open in China with back doors to block certain traffic/words and give law enforcement access to information on dissidents.

Re: China Wants To Buy Facebook Stock

#14

Post by esrauch »

nextparadigms wrote: post #11
tatsuke95 wrote: post #8

Earlier quoted context omitted.

Give or take, that's the latest figure being tossed around. I believe the last second market buy-in was at a valuation of $87.5 billion, and that was in May (someone correct me if I'm wrong). Adding 10s of billions of implied market cap a quarter. The bubble knows no bounds. Interesting product, interesting stock. Regardless, does anyone else think this is going to go down as the biggest tech stock blunder in history…

Last one was $70 bn. It dropped from about $85 bn. Even $70 bn is way too much for Facebook. I think their valuation grew more like a Ponzi scheme. Everyone thought it was going to have a higher value, so they invested more in it and told others about it. I remember it grew a few tens of billions basically overnight with bit tech sites claiming "..and Facebook's value grew another $5 billion this week". I think its v…

Google offered Groupon $6bn and they turned it down. Facebook is worth at least 10x as much as Groupon in my mind.

Re: China Wants To Buy Facebook Stock

#15

Post by mef »

esrauch wrote: post #12
mef wrote: post #10

The article confusingly states first that China's stake would not be influential, and then states that the apparent reason for China's interest is to have "control in the long run". Even if China's stake was influential, why would they need it in order to censor Facebook? They censor plenty of sites in which they have no stake whatsoever.

They are currently only able to completely block the website from China. If they can get an influential stake then they can have it open in China with back doors to block certain traffic/words and give law enforcement access to information on dissidents.

Sure, but what motivation would they have to open it in China instead of just blocking it and propping up a Facebook-style Chinese site that they can surveil for free?

Re: China Wants To Buy Facebook Stock

#16

Post by esrauch »

mef wrote: post #15
esrauch wrote: post #12

Earlier quoted context omitted.

They are currently only able to completely block the website from China. If they can get an influential stake then they can have it open in China with back doors to block certain traffic/words and give law enforcement access to information on dissidents.

Sure, but what motivation would they have to open it in China instead of just blocking it and propping up a Facebook-style Chinese site that they can surveil for free?

Perhaps they could get access to information about people outside of China.

Re: China Wants To Buy Facebook Stock

#17

Post by chernevik »

wisty wrote: post #7
jayp08 wrote: post #3

I dont think that will happen ...unless facebook's only interest is to make bucket loads of money. If China does end up buying stake in fb, fb risks loosing a lot of existing users.

Not really. China will get non-voting stock. I'd pay money to see a Chinese representative trying to explain to Mark "I'm the CEO, bitch" Zukerberg why their minority non-voting stock means Facebook MUST follow Chinese laws OR ELSE.

They are trying every vector of influence. Maybe they're trying to work up to a board seat. That would give them strategic and operational insights that would help them monitor and censor. And, position them to co-opt any China entry under a "partnership".

Also: Many Chinese are accustomed to considerable collusion and shady dealings among partners. Simply publicizing a stake could make many Chinese leery of FB, and less likely to use it politically.

Re: China Wants To Buy Facebook Stock

#18

Post by prostoalex »

esrauch wrote: post #12
mef wrote: post #10

The article confusingly states first that China's stake would not be influential, and then states that the apparent reason for China's interest is to have "control in the long run". Even if China's stake was influential, why would they need it in order to censor Facebook? They censor plenty of sites in which they have no stake whatsoever.

They are currently only able to completely block the website from China. If they can get an influential stake then they can have it open in China with back doors to block certain traffic/words and give law enforcement access to information on dissidents.

It's a dual-class stock structure, "an influential stake" is purely theoretical.

Re: China Wants To Buy Facebook Stock

#19

Post by SystemOut »

Hey, if they can get a few billion dollars of China's cash at the current inflated valuation for non-voting stock who are we to criticize?

They would need to somehow purchase very large blocs of voting stock to gain enough board seats to matter and that's not going to happen anytime soon.

I think this is much ado about nothing.

Re: China Wants To Buy Facebook Stock

#20

Post by bad_user »

esrauch wrote: post #14
nextparadigms wrote: post #11

Earlier quoted context omitted.

Last one was $70 bn. It dropped from about $85 bn. Even $70 bn is way too much for Facebook. I think their valuation grew more like a Ponzi scheme. Everyone thought it was going to have a higher value, so they invested more in it and told others about it. I remember it grew a few tens of billions basically overnight with bit tech sites claiming "..and Facebook's value grew another $5 billion this week". I think its v…

Google offered Groupon $6bn and they turned it down. Facebook is worth at least 10x as much as Groupon in my mind.

Considering that Groupon is basically burning cash and that (until further evidence) their business model is unsustainable, I don't think that's a good example.

People should really compare Facebook to Google. Google post-IPO was valued at a "bubbly" 27 billion in 2004. And take note that at that time Google already proved it had a viable business model; but people were still freaking out because Google only had one product, compared to what Microsoft or Yahoo had.

Are you going to tell me that Facebook is worth three times as much as Google did in 2004?

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