# Facebook (FB)



## james4beach (Nov 15, 2012)

This guy is a well known Australian/Canadian who produces science and physics videos on Youtube. He made this video describing a problem with Facebook's advertising system and found evidence that Facebook's revenue is based on *fake likes*. He's not saying the company is doing anything malicious, by the way.

For both investors and users of Facebook, there are interesting implications here. One is that a significant percent of Facebook accounts are fake (people and bots who just click "Like"). Another is that "Likes" are not very meaningful or useful, because of rampant fraud of fake likes. There is no point in paying money to promote your company via Likes... that part is clear.

It also makes me wonder how much of Facebook's overall business in a sham. They are an advertising company, and the ability to sell ads is based on the belief that buying ads (or promoting your page) gets you visibility among real potential customers. This is questionable, because if Facebook and/or fraudsters are gaming the market -- as they seem to be doing in some ways at least -- you can't really be sure how valuable those ads are.


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## m3s (Apr 3, 2010)

Here's what a click farm in Thailand looks like






Even an amateur analyst will see past fake clicks and likes by digging into the engagement data

There are definitively fake views and likes etc but I still think you'd get far better reach nowadays on social media than traditional mediums like TV which is dying fast. I used to laugh at cheesy internet ads but lately they have gotten to the point where they actually show relevant products and services.

My favourate brands are ones that sell direct to the consumer online and don't pay for ads. Rather they give samples of their products/services to social media savvy "influencers" who will do it for them . The cost of ads gets added to the price the consumer pays and self promoting holds much less weight than someone else doing it for you.

I recently met a guy who motorbike travels full time who is also an excellent photographer with a lot of social media reach in this niche. The new small companies who understand social media will throw products at him. The larger dinosaurs say he needs more likes and follows for them to even consider him.

The old dogs don't get social media or that he could just buy fake likes


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## humble_pie (Jun 7, 2009)

hey what a great thread topic

we all need to pay attention here
see the hot market in US fake news


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## jargey3000 (Jan 25, 2011)

....like, why should we care?.....


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## james4beach (Nov 15, 2012)

Why do we care about what any of these companies do?

It's relevant to investors, also people who work in companies who are spending $ on advertising too. Even the US government spends taxpayer money on Facebook advertising. Not sure if Canada does.


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## doctrine (Sep 30, 2011)

Have you advertised through Facebook? People and businesses do it because it's incredibly effective. Fake reviews are a thing for sure. However, Facebook has very detailed analytics for their advertisers. It's very impressive. And you can commit very small amounts of money to see how well it actually works, i.e. ends up in real referrals with real deals. It's the fact that nearly everyone is coming back with more money that FB is rolling in the cash.


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## jargey3000 (Jan 25, 2011)

...must...
....join....
...facebook....


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## james4beach (Nov 15, 2012)

doctrine said:


> Have you advertised through Facebook? People and businesses do it because it's incredibly effective. Fake reviews are a thing for sure. However, Facebook has very detailed analytics for their advertisers. It's very impressive. And you can commit very small amounts of money to see how well it actually works, i.e. ends up in real referrals with real deals. It's the fact that nearly everyone is coming back with more money that FB is rolling in the cash.


I haven't advertised through Facebook, but I've been involved with web based advertising for 13 years now. At times, it was nearly my entire annual income, so I know a bit about advertising, but definitely not an expert.

I'm skeptical of the value of web advertising and Facebook ads. Same with Google ads. They have these elaborate reports that make media people feel like it's money well spent, but stats are easy to misrepresent.

What is really an engagement in the end? How do you know that the $1 you spent *actually* contributes to real business revenue? People are so obsessed with 'visits to a page' or 'likes' or 'how many followers'... but how does that actually contribute to real purchases of your product?

I think there's tons of hype in advertising and it continues today. I think most of these companies are wasting their money buying ads, and I say that as a guy who's taken hundreds of thousands of $ paid by advertisers. Frankly, I think they're wasting their money and I'm astounded that these companies are willing to pay so much for advertising.


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## Mortgage u/w (Feb 6, 2014)

james4beach said:


> I haven't advertised through Facebook, but I've been involved with web based advertising for 13 years now. At times, it was nearly my entire annual income, so I know a bit about advertising, but definitely not an expert.
> 
> I'm skeptical of the value of web advertising and Facebook ads. Same with Google ads. They have these elaborate reports that make media people feel like it's money well spent, but stats are easy to misrepresent.
> 
> ...


Marketing is all about exposure. There are no marketing vehicles that can measure how much a 'view' or a 'like' translates to business dollars. Just like you have fake accounts and activity on Facebook, how do you know quantify the visibility and return on your dollar in a newspaper ad? billboard? TV? radio? Stats are based on whatever you would like it to be.

So if you believe Facebook has a large membership which will give you the adequate visibility, I wouldn't say its wasted money. The error some companies make in advertising is they choose only 1 avenue. All depends on your target audience, of course. But in general, the most successful companies continuously advertise everywhere. 

Look at Coca Cola for example - who doesn't know them? Yet, their ads are continuous......


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## OnlyMyOpinion (Sep 1, 2013)

A former Facebook adviser is urging governments around the world to shut down social media platforms until they can be reformed.
_"The people at Google and Facebook are not evil," said McNamee, an early investor in Facebook.
*"They are the products of an American business culture with few rules, where misbehaviour seldom results in punishment. Smart people take what they can get and tell themselves they earned it. They feel entitled. Consequences are someone else's problem."*
He added that "companies with responsible business models will emerge overnight to fill the void."
...
Centre for International Governance Innovation head Jim Balsillie, who became famous as one of the founders of Blackberry maker Research in Motion, also had dire words for the committee.
"Technology is disrupting governance and, if left unchecked, could render liberal democracy obsolete," he said.
"Data is not the new oil. It's the new plutonium: amazingly powerful, dangerous when it spreads, difficult to clean up and with serious consequences when improperly used."_ 

IMO, facebook could be shutdown tomorrow and the world would be no worse - better in fact. The (select) wealth created by these fluff apps is ridiculous.


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## doctrine (Sep 30, 2011)

Unless you are going to stop other sites from starting, a FB shutdown would only result in another FB incarnation taking its place. FB is merely a product of the internet and the natural human desire to connect. If not FB, something else. Simple as that. 

And based on thousands of other examples, the next incarnation would most likely be harder to monitor than the last, i.e. more distributed and encrypted from prying government eyes, but likely just as susceptible to inside influences and advertising, perhaps more so. The next interation of Facebook will likely be result in far more groupthink as people are rebelling against perceived and actual attempts to influence their own opinions and natural self-reinforcement tendencies.

FB is not being shutdown, but even if it was, there is no going back. Welcome to your new reality, society better get ready.


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## kcowan (Jul 1, 2010)

I think social media has just exposed the raw underbelly of human existence that for every positive, there are many negative forces that are being given voice. Many stars are increasingly eschewing social media for exactly that reason.

Take away twitter and you temporarily silence the crazies. Return FB to its roots reconnecting students.


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## MrBlackhill (Jun 10, 2020)

WSJ News Exclusive | FTC Preparing Possible Antitrust Suit Against Facebook


The case preparations come after the Federal Trade Commission has spent more than a year investigating concerns that Facebook has been using its powerful market position to stifle competition.




www.wsj.com


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## james4beach (Nov 15, 2012)

Facebook is being sued for spying on smartphone users. The lawsuit claims that Facebook activates the iPhone camera to collect valuable data on users.

But to be honest if this kind of thing bothers someone, they really shouldn't be using any social media application programs on a smart phone. The whole machine is one big spying device and all application programs, including Google's, collect an incredible amount of information on you.









Facebook Accused of Watching Instagram Users Through Cameras


Facebook Inc. is again being sued for allegedly spying on Instagram users, this time through the unauthorized use of their mobile phone cameras.The lawsuit springs from media reports in July that the photo-sharing app appeared to be accessing iPhone cameras even when they weren’t actively being...




www.bloomberg.com


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## Beaver101 (Nov 14, 2011)

Facebook is now known as ‘Meta.’ Here’s what people are saying online about the rebranding

FakeBook's renamed as "Meta = new lipstick on same old pig"


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## MrBlackhill (Jun 10, 2020)

Beaver101 said:


> Facebook is now known as ‘Meta.’ Here’s what people are saying online about the rebranding
> 
> FakeBook's renamed as "Meta = new lipstick on same old pig"


Yeah actually my understanding is that everything will keep its name, but because "Facebook (FB)" owns Facebook, Instagram, WhatsApp, better call it "Meta (MVRS)" which own brands Facebook, Instagram, WhatsApp. (Instead of saying that Instagram is owned by Facebook and that WhatsApp is owned by Facebook, they'll say that Instagram is owned by Meta and that WhatsApp is owned by Meta... and that Facebook is owned by Meta)

The same way that Google is actually under Alphabet, but Google brand stays Google brand.


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## Beaver101 (Nov 14, 2011)

^ The same musical chair shuffle ploy used elsewhere - eg. government and businesses. 

I believe the slang is: same old sh1t, just a different time/day. [Learned the slang from one of my health practitioner, believe it or not. I think it's hilarious coming from her!]


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## jargey3000 (Jan 25, 2011)

🤪🤪🤪









What's in a name? Meta Materials soars after Facebook identity switch


Facebook may have unveiled its new identity at a glitzy event on Thursday, but shares of a lesser-known Canadian industrial materials company surged in an apparent case of mistaken identity.




www.reuters.com


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## AltaRed (Jun 8, 2009)

YCFS. They are everywhere. Darwin wasn't efficient enough....


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## jargey3000 (Jan 25, 2011)

wish I'd had the foresight to buy & flip a few shares ...lol


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## MrBlackhill (Jun 10, 2020)

Facebook... Meta... New ticker symbol MVRS... MVRS?! It's the beginning of the end for Facebook...









Stocks With Clever Ticker Symbols Outperform Plain Names, New Pomona College Study Confirms | Pomona College in Claremont, California - Pomona College


Economics Professor Gary Smith, along with Pomona graduates Naomi Baer '19 and Erica Barry '19 studied the performance of a portfolio of 82 stocks, and found that companies with clever tickers outperformed the market.




www.pomona.edu





FAANG will become MAANG or maybe MANGA!

FAAMG will become MAAMG or maybe MAGMA!
GAFAM will become GAMAM or maybe GAMMA!


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## AltaRed (Jun 8, 2009)

What a gong show!


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## MrBlackhill (Jun 10, 2020)

I thought mega caps were hard to move. Now that I've seen the volatility of TSLA, I have confirmation that they aren't. Even more with GOOGL jumping +10% after market yesterday and now FB dropping -20% after market today.


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## m3s (Apr 3, 2010)

FB (meta) sees their userbase and engagement data in steady decline so they need to adapt

They bought whatsapp and instagram to stay relevant. That was somewhat in their wheelhouse. Then they failed to make a "centralized crypto" called Libra. They will integrate NFTs and crypto wallets

I think they will completely fall flat with metaverse. Their users are mostly boomers sharing stale memes from 5 years ago and foreign political misinformation. They don't know what a metaverse is


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## Covariance (Oct 20, 2020)

deleted


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## james4beach (Nov 15, 2012)

I think I laughed out loud the first time I heard they were re-branding to Meta.

Looks like shareholders just got Zucker'd.


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## Gumball (Dec 22, 2011)

Facebook (or meta) may just become a fad like Myspace was a decade or so ago... call me old fashioned but I dont see the apeal regarding Meta at all and hope its a short lived fad


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## AltaRed (Jun 8, 2009)

FB is making a seismic shift in corporate strategic direction. There is going to be major shareholder uncertainty until it becomes clear (or not) that this change of course is financially rewarding. Most likely years I think.


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## milhouse (Nov 16, 2016)

Agree with a lot of the comments.
5 years ago, I was already reading articles about demographic issues similar to what m3s mentioned. Kids don't want to be on the same platform as their parents who seem to the main users. Younger age cohorts are constantly shuffling to the next social media platform. Purchasing Whatsapp and Instagram were good moves at the time but it seems a constant battle to stay on top of the social media pile. 
At the risk of aging myself, from my days playing and socializing on WoW, I can _kind_ of see where they're going with the metaverse. But personally, I don't see the mass appeal required to grow the company.


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## m3s (Apr 3, 2010)

If the metaverse happens I don't think it will be controlled by Zuckerberg.

Zuck seems to be aware that things are shifting and he seems to be aware that crypto will be a big thing. He tried and failed to make Libra. Now he is pivoting to the Metaverse. He didn't come up with this term it was already growing in the crypto space. Notice that he is tracking and trying to catch a wave somehow.

Many even pointed out that he basically plagiarized a lot of branding and ideas (I'm not that into the metaverse world to know) Remote teams were already meeting in virtual offices/celebration in the metaverse because they often never met and don't really have a place for parties or big conferences. Zuck is just copying a lot of those concepts

web3 is a concept to remove data control from the centralized big tech. Zuck is well aware of this but I think it's too little too late.


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## MrMatt (Dec 21, 2011)

I think there are a few things going on at Facebook.
Metaverse is headline grabbing and fancy.

But there is a boring part, e-commerce. Several of my neighbours run craft businesses, one just quit their job to run it full time.
They run it through Facebook and Instagram. They're busy all the time, turning away business even now, in February.

It's also cost competitive with shoplifty, particularly if you're starting out, why pay for Shopify when Facebook Shops is free, and you're already there on Facebook & Insta, which is what your customers are using.

I've virtually stopped using Kijiji to sell stuff, and I just post items on Facebook Marketplace.
The sports club I was at found great engagement in Facebook ads, they could target specific neighbourhoods and demographics, few wasted dollars.

People are making real money with Facebook, and they've actively developing these aspects.

Even if I wanted off Facebook, I can't, it's what sports teams are using to discuss items, it works better than mailing lists.
Of the sports groups I was engaged with many run schedules and official stuff through their website and app system (sportsengine, custom).
But teams are moving their discussions to Facebook, about half the teams create a Facebook group for easy discussions.

I think facebook accounts are very sticky, and that gives them a huge edge going forward.


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## m3s (Apr 3, 2010)

I heard Facebook is also the place to find rental properties now.

It was used for group discussions like reunions and old groups but most of that has gone away in my groups. We mostly use group text apps and apps like Discord or Telegram now. For older groups it does seem to be Facebook. There was Clubhouse and now there's Twitter spaces which seems to be a copy of Clubhouse. Work uses things like Slack

Thing is Facebook engagement data and ad revenue is declining steadily for some time now. I don't see that reversing from metaverse


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## MrMatt (Dec 21, 2011)

m3s said:


> Thing is Facebook engagement data and ad revenue is declining steadily for some time now. I don't see that reversing from metaverse


Overall Revenue is still growing at a healthy clip.


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## diharv (Apr 19, 2011)

They seem to be doing adequate expanding laterally to offer more to the current user base, but no kid now will admit to having FB as their social media platform. The days of exponential growth are probably over and maybe reverting to something more sustainable long term. Zuckerberg still has 92B left so he will probably be ok for awhile.


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## doctrine (Sep 30, 2011)

It's hard to grow your revenue by 30% a year forever. Not least of which when your company at $100B of revenue. This is why valuation matters, because if you own a company like FB, you need something underneath when the slowdown inevitably comes. And with FB now with a P/E in the 15-17 range, you could see big returns if they can start improving their margins again.


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## fstamand (Mar 24, 2015)

Anyone getting in at these levels?


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## MK7GTI (Mar 4, 2019)

fstamand said:


> Anyone getting in at these levels?


Anyone getting in now?!


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## andrewf (Mar 1, 2010)

Wow.

I wonder if they can succeed like Google in squeezing more revenue per user now that user growth has essentially stopped. I think Facebook is a lot more vulnerable to new platforms, moreso than Google is in search.


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## m3s (Apr 3, 2010)

I try to change my default search engine but I always end up switching back

Facebook managed to takeover Instagram when the young crowd migrated but now they are all on TikTok

Meta is an attempt to get ahead of what's coming next but it will fail like Libra


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