Businessweek has reported a rumoured deal for Facebook for over a billion dollars! Now thats Web 2.0 rocking
I guess we will see a few of those plans back in India pretty soon 🙂
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The media argument to web 2.0 businesses is perhaps a good one, only if you can sustain the audience interest. The widespread belief in silicon valley seems to be that Myspace has gone cheap and is doing very well (even on revenues)
while “web 2.0” (though from what i understand, facebook uses little of what constitutes web 2.0) is surely rocking, the $2b price tag appears too inflated. I think it has more to do with Viacom trying to desperately balance out aquisition of myspace by Murdock empire. On other note, myspace gets more traffic than amazon, so you never know.
However, what needs to be cogitated upon, and what hasnt been apparent as yet, is whether a stand alone social networking site can become that valuable on its own. It does start making sense when acquired by a Biggie; but by definition, there are only these many Biggies and there are only these many aquisitions that they can do. With time, delta gain from additional aquisitions would become too small for such high number deals to make sense.
However, in indian context, there are several other dimensions to this issue. While it calls for a detailed discusison, the skewed agewise demographic distribution is certainly one aspect strongly in favour of these models.
Ravi IMHO Facebook is inflated at 2 billion but definitely is no indication of a bubble. Face book is as Alok pointed out true web 2.0. If we work out the numbers facebook should be valuated at less than .75 billion.
Alok in India we are about 18+ months behind the valley in web 2.0 infact already there is now 2nd generation of web 2.0 entrerenuers in valley. In india atleast a few new ideas need to pop up. There is hardly any and still many in India don’t get web 2.0 at all 🙁
Rajan
http://rajan.wordpress.com
Let’s say you were a TV producer and you created a 30 minute television program that aired once a week. And let’s also assume that you had 90% of ALL college kids in the US watching it, as well as a decent slice of high school kids. Moreover, you paid $0 for actors, filming, post-production and network access. How much would that show be worth?
I don’t know, but I would assume a lot. Apparently Viacom (the rumored buyer) did so too. Facebook had 5.5 billion page views in February 2006, which is 5.5 billion opportunities for ad impressions. If you compare that to a hit TV show that airs once a week to 15 million Americans and has 20 thirty-second ad slots, you can quickly do some rough math on why Facebook’s numbers are so impressive. Of course, a static ad does not have the same weight as a full motion video advertisement, but then again, have you seen some of the ads on appearing on sites like http://www.nytimes.com?
A billion $s is probably too rich, but I do think they are worth several hundreds of millions.
I guess, Bubble 2.0 is not far behind.