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Posts Tagged ‘Facebook’

Browsing the Forbes Magazine Special Issue Meet the Richest People on the Planet, I found Mark Zuckerberg with a fortune of $33.4 billion as number 16 on the list. Footnote: I just tried to get you a link to this article on-line. Forbes website sucks. It is choked with video ads to the point where you can’t find the content. Click on this link at your own risk.

As of today, Facebook’s market cap is $234 billion and rising. Facebook has about 7,000 employees according to Wikipedia.

How does a company that young, with comparatively few employees, have such immense value? 7,000 employees is VERY LITTLE for a company that large and valuable. For comparison, J.P. Morgan Chase has a market cap of $230 billion, about the same size as Facebook, but it has 63,000 employees worldwide. Both Target and Wal-Mart have over 300,000 employees each and have less market cap than Facebook.

Who are the job creators in this country? Well, it’s not Facebook.

I have “used” Facebook for many years, but I cannot say that I ever paid a penny for it. Ever.

The Facebook posts inserted in my feed are always ticklers with interesting headlines that have me clicking quite often to find out more, only to be redirected to some aggregator site that is so choked up with advertisements (I have seen pages with 20 ads within the user’s view) that the actual content is very hard to find. The sites are also so cumbersome and slow, it’s painful to navigate and it’s difficult to page through the content without accidentally hitting some advertisement. This is an example from today. Click on it and see what I mean.

In summary, the ads that Facebook leads me to are so annoying that I have conditioned myself to resist even clicking on content that looks vaguely interesting.

However, Facebook does have 1.3 billion users, 800 million of who log in every day. I am one of them. I check what’s going on with my friends. That takes about 5 minutes in the morning. I finish up clearing all my posts older than a few days – so my “wall” is usually empty, and I get out of there.

So how is it that something that creates so little stuff that can be sold, that really doesn’t CONSTRUCT or BUILD anything, creates such enormous wealth for its founders and owners?

The economy of the United States is built on companies like these now. They create value, but not a lot of jobs and really no “goods and services” that are pumped back into the economy. A few people and engineers in Silicon Valley get very rich, but the middle class across America does not get jobs out of those. Apple, by far the most valuable company on the planet by a factor of two, does most of its manufacturing overseas. Few jobs in America.

For America to be competitive, for the middle class to thrive, we have to “create jobs” here in this country. And unfortunately, it’s not something the politicians can do, no matter what the loud-talkers like Scott Walker, Mitt Romney and Jeb Bush trumpet.

I have spoken, and now on this sunny Saturday afternoon, I go back to work on the stuff I didn’t get done last week at the office.

 

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As our lives have become more and more public over the last decade, we have to ask ourselves whether we down the data that we “create.”

WordPress

No doubt, I own the words on this blog post as I am writing them. I know for sure, because I am making them up one word as a time as I go.

However, they are not stored in any place that I own. They are stored on some website server hosted by WordPress, and frankly, I don’t even know where in the world. As soon as I click on that “Save Draft” button to the right of this column, this sentence could actually be sitting somewhere in the dark arctic night in North Sweden, or in Atlanta, or in North Carolina, or right here down the street in San Diego, exactly where I will never know.

I haven’t even backed up this blog. If WordPress were to vanish overnight and prevent access to its servers… Gone. I probably agreed to those terms in one of those Terms and Conditions forms that I signed by checking and clicking many years ago when I created my WordPress account. I may think I have the right to my data in my blog, that I own it, but do I really?

Based on data of 2012, WordPress powers one of every 6 websites on the Internet, over 60 million in all, with 100,000 new ones being created every day. WordPress sites attract 330 million visitors who view 3.4 billion pages every month.

With numbers like this, especially 100,000 new sites a day, I don’t think WordPress would care about my data. So I really don’t own it, unless I make provisions to back it up.

That’s just WordPress.

Facebook

The situation is much more dire with Facebook. Generally I like to say that if you don’t pay for a website you heavily use, you ARE THE PRODUCT. That’s definitely the case with Facebook. Facebook is a business that sells the information about you that you give it. It’s as simple as that.

Have you ever tried to get rid of stuff you have posted on Facebook? If you did, you will know it’s pretty much impossible to do in any efficient way. You have to select, delete and confirm deletion one post at a time. That means three clicks per post, and a few more every five posts, when you have to refresh the current page. If you have thousands of posts, it’s going to be a very long and tedious effort to remove the material you think you own from their site, if not practically impossible. There are scripts you can download that supposedly do this in some automatic fashion. I tried two of them, and I could not make either work. Perhaps they don’t work, perhaps I didn’t use them right, but be assured, it’s complicated.

Kindle

In the past three or four years, pretty much all the books I have bought are in Kindle format. I carry all my books around with me wherever I go. I purchased all these books for prices higher than I used to pay for standard paperbacks. Amazon says I own those books. I just can’t touch them. Amazon agrees to provide them to me any time I ask for them in electronic format.

What would happen if Amazon shut down tomorrow? Would I still own my books? Does my contract with Amazon ensure that I own them? What if Alibaba bought out Amazon tomorrow, and the Chinese government took over control of Alibaba the day after that? What about my property then? I am sure there would be class action lawsuits – the stuff trial lawyers dream about – and after decades of court cases I’d get a monetary award for the value of the property that was taken from me.

In practical terms, I am well aware that my books are mine only as long as Amazon is a successful and continuing company.

Summary

It depends on the data – but the entire system of online life and online data has not been stress-tested. Purchase and store online at your own risk. Be prepared that it does not take a house fire to have it all taken away – but seemingly benign market shifts could result in disaster.

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There is a famous saying related to poker playing:

“If, after the first twenty minutes, you don’t know who the sucker at the table is, it’s you.”

Same thing with Facebook. Facebook is a website, now rumored to be worth $100 billion. There is no product you can buy on Facebook. When there is no product to be found on a website, beware, because…

…you are the product.

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