With 900 million users, and an initial $104 billion valuation, let’s say each Facebook profile is worth about $100. Now, the relative worth of a profile of course varies, based on level of engagement and other factors, but for argument’s sake, to Facebook, and now to its shareholding public, you are worth about as much as a matinee ticket to Rock of Ages. But that’s just one you. It’s the collective YOU that really matters.
Of course, data gathering as a for-profit enterprise is not unique to Facebook. For instance, the other company of comparable size whose main product and asset is its users is Google. However, there is a key difference: Google is transitive, whereas Facebook is reflexive. In other words, Google and its data collection are outward moving, leading to other destinations on the web, other resources. Facebook’s project builds entirely on the sum of its users interactions with one another.
In this sense, Google could be likened to a librarian, whose services we enlist in exchange for the concession that what books we ask for will be tracked. Facebook, on the other hand, is like a party that all your friends attend, but in order to yourself, you must agree to have all of your interactions recorded. In this way, the data, the information, and ergo the value of Facebook is internally generative: the more interactions, the more information, the more the collective YOU is worth. And the rate of addition to the data value is astonishing. According to Facebook’s own numbers, more than 3 billion “likes” and comments are posted per day, along with the uploading of more than 300 million photos (per day!)
It’s then either a post-modern joke or a Marxist irony (or both at once) that we are able to buy shares of us. But either way, I don’t want you buying shares of me.
(Add to this the further irony that before the ostensible public offering of Facebook’s stock, the vast majority was spoken for by the big-ticket clients of the banks that underwrote the IPO. And of the shares that were available to retail outlets, those were distributed preferentially to clients with the biggest accounts. Poor? Join Facebook. Rich? Buy Facebook.)
In the days since the IPO, Facebook’s stock slid below its offering price—and as of this writing, is at $31 a share—but the daily stock prices are not the point, at the moment. Even as Mr. Zuckerberg’s personal fortune fluctuates in multibillion-dollar swings, his project is bigger.
Projected to have one billion users by year’s end, the sheer size of the Facebook community makes it hard to grapple with. There are few commodities, aside from air and water, used by as many people. Only Coca-Cola and Microsoft, and maybe McDonald’s, can claim comparable numbers. Fully half of all Internet users are on Facebook, and that’s a lot of eyes on ads