How Facebook?s social networking dominance failed to monetize

The video clip on YouTube already has the feel of a history lesson. It has taken on the atmosphere of a fateful moment, a before and after, like the signing of the Yalta Treaty, or a Moonie wedding. The moment of the launch of Facebook as a US$100 billion public company seemed to show the myth of the American Dream in real time, visual proof that something ? potentially the world?s most valuable entity ? had been made out of nothing, a simple idea in the head of a Harvard undergraduate. Half a year on, it looks as much an ending as a beginning.

You can see a lot of that story in the film clip, on faces gathered outside Facebook?s headquarters at Hacker Square in Menlo Park, California, on May 18. Our digital age has acclimatized us to extreme numbers, the winner-takes-all lottery of wealth distribution, but rarely have we seen such a group of people instantaneously enriched beyond their imagination. The colleagues look like they have turned up on this bright spring morning to man the stalls at a high-school fete, or for a charity walk, in hoodies and T-shirts and fleeces and jeans. One second they can count their wealth in five or six zeroes, the next in eight or nine or 10. As the clip rolls and Mark Zuckerberg signs his name on a transparent NASDAQ screen, signaling that Facebook is open for trading, an excitement passes through the crowd. On the TechCrunch Web site there is a ticker running, a reckoning of instant plutocracy: ?Ted Ullyot, general counsel, US$234,181,060. Mike Schroepfer, VP of engineering, US$340,141,012. Mark Zuckerberg, US$20,305,226,592...?

How do the people attached to these numbers look? They look happy, fit to burst.

That happiness, at that moment, extended far beyond Hacker Square. It extended to all the investors large and small who believed. Zuckerberg, 28, had long demanded faith in Facebook. All his believers knew the story ? they had all seen the movie and most importantly, they felt the insistent pulse the social network had generated in their own lives. On the clip, after NASDAQ chief executive Bob Greifeld presents Zuckerberg, ?your visionary, your leader,? with a commemorative hoodie, the world?s favorite boy wonder makes a little speech reaffirming that faith.

?Here?s the thing,? he said in his slightly disconnected way, ?our mission isn?t to be a public company. Our mission is to make the world more open and connected ... All of you out there have built the largest community in the world.?

All of the night before, news networks have accessed all areas on the Facebook campus to capture the atmosphere before the big sell-off. The Facebook workers, or hackers, as they prefer to be called, have duly performed like children on Christmas Eve. They have given up on sleep and engaged in the ultimate ?hackathon,? playing roller hockey in the square, watching movies, camping out on sofas and doing bits of programming for the site, ordering in Chinese food and pizza, recreating once again the essential exportable spirit of their organization: faces illuminated into the early hours by laptop screens, buzzing on energy drinks, silently instant messaging across the room, making the world ever more connected before our very eyes.

They have not been thinking about performance cars and stupidly early retirement; they have been thinking, as ever, about enhanced user experiences and ever-cooler interfaces. Still, they are aware that for days and weeks the valuation of their company has been the subject of mass speculation. The wisdom of a Silicon Valley crowdsourced poll has produced an aggregate of the expected value of Facebook come the end of the first day of trading. The figure that has been collectively arrived at is US$135.1 billion ? a single-day rise that represents more than a gain of one-third of the opening offer price of US$38 per share. The investment bankers handling the offering, Morgan Stanley, have surely been conservative in their thinking, the crowdsourced feeling goes; they would not want to risk their credibility on an inflated valuation.

Source: http://libertytimes.feedsportal.com/c/33098/f/535601/s/24cb1802/l/0L0Staipeitimes0N0CNews0Ceditorials0Carchives0C20A120C10A0C240C20A0A3545943/story01.htm

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