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Ford vs Facebook

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Re: Ford vs Facebook

#11

Post by TazeTSchnitzel »

jerrya wrote: post #10

Certainly what makes Facebook valuable is their huge network which is sustained, I think, through barriers to entry (network effect), and barriers to switching (owning your data). I wonder what might happen, if it could happen that the EU or US FTC mandates api access into and out of Facebook, perhaps after a decision that 2015 Man will use social networking as a needed public infrastructure, to be provided on a comm…

Facebook does make it surprisingly easy to get a copy of all your data. There's a single big button on the site which will make a ZIP file containing all your data on Facebook, except for data stored in Apps (outside of FB's control), and comments you've made on other people's posts. It will even tell you your previous IP addresses and I think auth tokens.

Re: Ford vs Facebook

#12

Post by rudiger »

excuse-me wrote: post #6
TazeTSchnitzel wrote: post #5

Perhaps it's a bubble, but Facebook is used by an eighth of the people on the planet. Tell me that's not an asset. A single company has lots of information about and can display advertising to an eighth of the alive human race. Then again, so does Google, I suppose.

The English language is spoken by a larger number - that doesn't mean the OED is worth a trillion $

This is a stupid statement. Hundreds of millions of people aren't reading OED every day.

Re: Ford vs Facebook

#13

Post by jerrya »

TazeTSchnitzel wrote: post #11
jerrya wrote: post #10

Certainly what makes Facebook valuable is their huge network which is sustained, I think, through barriers to entry (network effect), and barriers to switching (owning your data). I wonder what might happen, if it could happen that the EU or US FTC mandates api access into and out of Facebook, perhaps after a decision that 2015 Man will use social networking as a needed public infrastructure, to be provided on a comm…

Facebook does make it surprisingly easy to get a copy of all your data. There's a single big button on the site which will make a ZIP file containing all your data on Facebook, except for data stored in Apps (outside of FB's control), and comments you've made on other people's posts. It will even tell you your previous IP addresses and I think auth tokens.

I'm thinking more of API access so that external apps can be created to link Facebook to other networks, so that tweets and google plus and tumblr posts and all that stuff can just flow from one network to the next like telephone calls can do now.

I just clicked on "Start my archive", Facebook will email me when they are done zipping it up.

Re: Ford vs Facebook

#14

Post by jwilliams »

Capital will ("should") flow to where it can be the most useful at producing wealth.

This is just the market saying "I'd rather see what Facebook can do with X billion than Ford."

Which on the face of it seems fair - Google had a similarly crazy PE when they floated. They grew into it pretty quickly though.

Re: Ford vs Facebook

#15

Post by DVassallo »

joe_the_user wrote: post #7
DVassallo wrote: post #2

Value is being determined based on activity (page views, ad impressions, users), instead of real things like... you know... money and assets. Users, pageviews, etc, are assets. If the market will be able to determine their "correct" value... that's another question.

You are correct these things can be viewed as assets. However, if the author is deriving his data from Facebook's own declarations, then even they aren't claiming the value of their assets including User-loyalty, are anywhere near their market cap.

Auditors would stick to the the accounting standards and conventions to give a monetary value to users and other intangible stuff. Whereas the market (in theory) can value the whole company's ability to use these intangibles to generate money in the future. That's why there's often a significant difference between the "assets - liabilities" on the balance sheet, and the market cap. Now, whether such a big discrepancy is justified... that's another thing.

Re: Ford vs Facebook

#16

Post by tatsuke95 »

TazeTSchnitzel wrote: post #9
excuse-me wrote: post #6

Earlier quoted context omitted.

The English language is spoken by a larger number - that doesn't mean the OED is worth a trillion $

The OED doesn't know your social connections, your sexual orientation, your date of birth, your address, your previous address, your current location, your gender, your age, your interests, your employer, all the websites you've visited or even what you look like.

So, they have good information for advertising. And that's going to valuable, no doubt...

...but that's it. They aren't building a physical product, they're going to sell other people's products. Or, sell information so that other people can sell other people's products.

I find it absurd that the market for web based adverting, between Google and Facebook and others, can be this valuable in the long run. These are advertisers, for crying out loud. People can talk about how many users Facebook has, but there are more automobiles worldwide than there are Facebook users.

What is worth more; a car purchaser, or a Facebook user?

Re: Ford vs Facebook

#17

Post by johnhartigun »

jwilliams wrote: post #14

Capital will ("should") flow to where it can be the most useful at producing wealth. This is just the market saying "I'd rather see what Facebook can do with X billion than Ford." Which on the face of it seems fair - Google had a similarly crazy PE when they floated. They grew into it pretty quickly though.

Investors don't invest because of curiosity. They want to earn money.

Re: Ford vs Facebook

#20

Post by jwilliams »

johnhartigun wrote: post #17
jwilliams wrote: post #14

Capital will ("should") flow to where it can be the most useful at producing wealth. This is just the market saying "I'd rather see what Facebook can do with X billion than Ford." Which on the face of it seems fair - Google had a similarly crazy PE when they floated. They grew into it pretty quickly though.

Investors don't invest because of curiosity. They want to earn money.

I didn't mean it in a frivolous way.

What I'm saying is it's not a basic value equation. Buying an asset does not create wealth. It's the application of that asset.

It's not simply Facebook has a book-value of X -- It's The market thinks Facebook can build more wealth with their $ than Ford.

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