Facebook Inc.

[Wildreamz]

Source: https://www.forbes.com/sites/zakdoffman/...8e9c033623


Facebook's business model lately has been "gathering as much private information as we can get away with from our users". In fact, it has always been this way if you have been observing Zuckerberg for awhile (https://www.esquire.com/uk/latest-news/a...ta-dumb-f/). Instead, they could have accreted much more shareholder value, by, say: making their product more useful to their users; making the best interest of their users and advertisers aligned; disrupting more industries etc.

This is why I'm not invested in Facebook, despite their quasi-monopoly status, attractive valuation, and growth prospect.

2c.

(ex-investor)

[weijian]

Well, it is probably no big deal, because if you want to do online ads at scale, there isn't really a lot of choices outside of Google (placements, ads, youtube) and FB (ads, instagram feeds). These guys have monopolized the online space, and there isnt really alot of other choices as these tech giants are still providing value to them.

Zuckerberg outlines how Facebook will thrive after Apple privacy change

Facebook is not getting into commerce because it wants to compete with the likes of Amazon or Walmart. In most cases, Facebook only charges a 5% fee that covers things like taxes and payment processing. The point isn’t to make money from sales but from advertisements that promote those products.

Indeed, although Facebook has groaned and griped for months about Apple’s iOS 14.5 changes, CFO David Wehner on Wednesday told analysts “the impact on our own business we think will be manageable.”

https://www.cnbc.com/2021/04/28/zuckerbe...-push.html

[weijian]

Things should always come for free to minimize friction before value-extraction (ie. charging for it) starts, isn't it?

If this is a marketplace with a close to a billion users, I guess the rules eventually need to be there but having the rules there right at the start, probably creates friction to adoption again.

The ever-changing pressures of running an Instagram business

After attending a seminar on Instagram’s checkout feature, Reichenbach decided to resist using it for her shop. In her opinion, the function isn’t beneficial for small sellers and prevents them from retaining customer information. “Instagram wants to insert itself as the middleman within these transactions,” Reichenbach told me, adding that other artists share this concern. “It would take commission from the sale, which is hard since I can’t always afford that. There are also rules about how sellers have to send out orders in a certain amount of days and a 14-day return policy. As a small seller, I can’t always adhere to that, and I rely on preorders to gauge interest.”

“You always feel like you have to be doing or posting something,” Reichenbach said. “There’s a lot of exhaustion, but what can you do? Instagram allowed me to have my own business.”

https://www.vox.com/the-goods/22544067/i...ns-sellers

[Wildreamz]

Instagram global search trend vs TikTok.



Tick-tock, the clock is ticking.

(ex-investor)

[Wildreamz]

Facebook vs ByteDance revenue.

[weijian]

Podcasts has recently creeped into part of my learning experience.

A pretty instructive 1hr 15min discussion (for VBs who can afford some time) on Facebook. This is for all the VBs (like me) who are pretty old school and trying to expand our circle of competence.

Facebook: The Trillion Dollar Listing - [Business Breakdowns, EP. 15]

Robert Cantwell is the founder and CIO of Upholdings. Jesse Pujji is the co-founder and CEO of Ampush. We cover how Facebook successfully navigated the transition from desktop to mobile, what drives the value of its network, and dive deep into the Facebook ad ecosystem.

https://overcast.fm/+rra6SEN8k/1:41

[weijian]

Miss Haugen says there wasn't malice from the executives but it was about the incentives.

This reminds me of Well Fargos' own scandal a couple of years back but banks clearly are more regulated than social networks (whom themselves are just 10year infants). If the incentives haven't been set right, the buck has to stop at the top.

Facebook 'chooses profit over safety', says whistleblower

In the "60 Minutes" interview, Ms Haugen said that the company's News Feed algorithm is optimised for content that gets a reaction. The company's own research shows that it is "easier to inspire people to anger than it is to other emotions", she said.

"Facebook has realised that if they change the algorithm to be safer, people will spend less time on the site, they'll click on less ads, they'll make less money." During the 2020 US presidential election, she said, the company realised the danger that such content presented and turned on safety systems to reduce it.

https://www.businesstimes.com.sg/compani...stleblower

[Wildreamz]

For 17 years (Facebook was founded in 2004), Facebook could not find a viable/profitable business model that respects and benefits all stakeholder. Misaligned incentives? Malice? Incompetence? Perhaps a combination of all?

Either way, I will not be interested to be an investor. Personally.

(not vested; ymmv)

[D123]

For 17 years (Facebook was founded in 2004), Facebook could not find a viable/profitable business model that respects and benefits all stakeholder. Misaligned incentives? Malice? Incompetence? Perhaps a combination of all?

Either way, I will not be interested to be an investor. Personally.

(not vested; ymmv)

There are many forms of social media. Some categories include:

1. predominantly 1-to-1 messaging (WhatsApp, FB Messenger, Snapchat, Signal, Telegram etc.)
2. predominantly 1-to-many multi-media (Twitter, FB, Instagram, Pinterest)
3. Short-form video (TikTok)
4. Long form video (YouTube)

One might believe that FB is doing an insufficient job at managing stakeholders' interest. But - and I'm not being snarky, just genuinely curious here - which other forms of social media is doing a better job or is better positioned to do a better job?

What are the solutions to all the mistakes which Facebook is making?

[Wildreamz]

Hi D123,

There has been many discussions of this around the internet, including on this forum, if you scroll back a few pages. As an example, you can refer to post #171 (https://www.valuebuddies.com/thread-1649...#pid160529) where I compared the privacy policy of Whatsapp with it's various competitors: iMessage and Signal.

I will give a few additional examples.

In recent years, Youtube has introduced Youtube Kids, where it gave parents greater control of what kids (13 and under) can see, can search for, screen time etc. On Youtube Kids, there are many restrictions to ensure content is kids friendly, clearly demarcated/separated content and advertisements, disabling Miniplayer on mobile devices (there are no official explanation, but I speculate that this is to prevent kids from developing the habit of short attention span (surfing for the next video before the current video is completed) from young), disabling comments section (so trolls, predators will not use it to provide unmoderated bad influence to kids).

Even though, no one specifically asked Youtube to provide all of the above; and even though some of the decisions above, may have costed Google some short-term profits (engagement etc.). This is a pattern of behaviour that (to me) shows that Youtube (Google), knows their influence and power, is thinking many step ahead of time so as to minimize negative externalities of their products. The end result is a content platform that is one of the most creator and advertiser friendly (there are many other example for the regular Youtube, but I don't want to get too exhaustive).

Compare and contrast what was revealed in the recent whistleblower case, where Facebook, deliberately amplifies hateful and divisive content to create more "engagement": https://youtu.be/2GmsM6EU4nc?t=698 (I have time-stamped the video for the important discussions; but the whole video is detailed and a good watch). Note that the whistleblower has also worked for other social media companies (Pinterest and Google) as well as is a founder of a successful dating app (Hinge) herself; she is a made person (minimal to gain, much to lose), qualified (industry veteran), no axe to grind with Facebook (not a disgruntled employee); ie. she is extremely credible as whistleblowers go.

To see how Facebook amplifies divisive post/misinformation in real-time, check this Twitter account: https://twitter.com/FacebooksTop10 . Look at what's trending the last few days/months, it's usually conspiracy/misinformation/propaganda outlet such as Newsmax, Ben Sharpiro, Brietbart, Fox News etc.

Lastly, I would also like to post a question back to you: Where do you rank Facebook, in terms of social media operators? Are there any major social media operator today, that operates in even greater bad-faith than Facebook?