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Business and Media
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History Most people know the story by now of how
19-year-old Harvard sophomore Mark Zuckerberg
started Facebook in his college dorm room.
The site, which essentially began as an online
student directory, went live on Feb. 4, 2004.
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Within four days, more than 650 students had
registered. After one month, the number had reached
10,000.
And now, more than six years later, close to 500
million people worldwide actively use the site.
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Secret of
Secret of fa
cebookfa
cebook makingmaking
moneymoney
ADVERTISEMENT BUSINESS:
Self-Serve Facebook Advertising- Rs.202500 lakhs.
Engagement Ads Rs.112500 lakhs.
Microsoft Banner Advertising Agreement
Rs.22500 lakhs.
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CONT..
VIRTUAL GOODS AND THE GIFT SHOP:
Revenue Rs.67500 lakhs.
FACEBOOK CREDITS:
Revenue Rs.67500 lakhs.
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Competitors of Facebook
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Future Aspect of Facebook
After five years- picture of a big
industry.
Ambition of Mark Zuckerberg
Facebook the most important influential
technology company in the world.
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HOW FACEBOOK MAKES
MONEY
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Self-Serve Facebook Advertising
The largest chunk of Facebook revenue is self-serve
advertising platform.
The primary advantage of Facebooks self-serve
advertising platform is the granular targeting features.
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Facebook recently released the Facebook Ads API which
provides large ad buyers with the ability to build robust ad
managers on top of the Facebook advertising platform.
We expect Facebook to generate somewhere in the
range of $450 million this year (201
0) on self-
serve ads.
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Engagement Ads
Engagement Ads are Facebooks solutions for large
brand advertisers.
Facebook places all engagement ads on the sites
homepage. Once a user logs in, they can interact
with advertisements.
Facebook stepped up their efforts with the launch
of Brand Lift.
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Microsoft Bann
er Adv
ertisingAgreement
Facebook had an advertising agreement with
Microsoft for displaying large banner ads on the site.
Facebook is phasing out the banner
advertisements from Microsoft as they want to be
completely self-sufficient.
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Total revenue generated from Microsoft
advertising will be less than $50 million
this year as they phase out banner ads
completely.
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Virtual Goods And The Gift Shop Facebook currently generates a large amount
of revenue from the Facebook Gift shop.
Its a product which enables users to sendvirtual gifts to one another.
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At an average cost of $1 per gift, Facebook gifts
have become an extremely lucrative business,
generating upwards of $100 million last year.
Facebook has been slowly opening up the gift shop
to third-party developers.
Facebook to generate upwards of $150 million from
their gift shop by the year 2012.
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Initially used as a way for Facebook users to purchase
virtual goods through the Facebook gift shop.
Facebook is slowly opening up Credits to
third-party developers. The purpose is for developers
of applications.
Facebook to generate $150 million in revenue from their
Credits platform this year
Faceb
ook Credits
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2010 Revenue
By growing multiple revenue sources,
mostly around advertising.
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RevenueSources
Brand Advertising($150 $350 million).
Microsoft Advertising.
Virtual Goods($10 million).
Performance Advertising($150 million).
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Revenue System Romoured Run
Rate, July 2010
Estimate, EoY 2010
Brand Advertising $125,000,000 $225,000,000
Microsoft Advertising $150,000,000 $50,000,000
Virtual Goods $75,000,000 $10,000,000
Performance Advertising $200,000,000 $350,000,000
TOTAL $550,000,000 $635,000,000
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Facebook is currently trying to become the worlds
largest social utility, expanding their social graph
globally.
Apple has adopted Facebooks Mobile Application
within their newest and the worlds most popular
cell phone, the iPhone (3G).
CONCLUSION
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Facebook has no real competitors in the
mobile social market due to their Mobile
Platform.
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