Paul Joseph

Facebook is in the centre of a lot of news and gossip due to its upcoming IPO and the pundits are out there everywhere overanalyzing Zuckerberg’s every move. Just last week, he got a lot of flak from traditional Wall Street analysts on the lack of his business attire when he attended one the Investor Road Shows in New York City. Facebook has one thing for going for it! It will become one of the most valuable US firm due its capturing the imagination of a complete generation. It’s not just about the financials, the company has been able to make a deep impact on human life, communications, networking, marketing and advertising. This is what makes Facebook’s upcoming IPO an exciting event. People want a slice of the success that Facebook has achieved over the years as it morphs into the world’s greatest connector of minds with its 900 million users . Let us look at the key points in the IPO according to the reports so far. The IPO: Facebook has set the prices for its shares which currently range from $28 to $35 , according to their filing with US Securities and Exchange Commission. This pricing range makes the company’s valuation somewhere between $70 billion and $87.5 billion . This is enormous compared to Google’s IPO in 1994, which gave it a $23 billion valuation. Today, Google’s market value is in the range of $200 billion. Zuckerberg will be retaining 57.3% of the voting power of the shares. Many people are not very happy with the price range which has been set since they feel it is undervalued. There have been expectations of a share price of $44 .  The IPO will also mean that a lot of early Facebook employees who have stock options will get a major windfall of money from this IPO. However, this might not be a good thing as this article from the Economic Times suggests. Sudden influx of cash of this magnitude may change the attitude of these early and senior Facebook employees. They may leave to pursue their own things and this might just change things, but this is mere conjecture and is not really important to pursue at this time. Mobile: The next frontier for Facebook to conquer commercially is the rapidly growing mobile platform. Facebook has definitely succeeded in putting its presence out in mobile . The problem lies however with monetization as the small screen of the mobile phone does not allow the social network the same advantage that the web version allows. Their revenue in the mobile space never really taken off in the right direction. The problem with the whole thing is the fact that large number of Facebook’s users access the service via their smartphones & mobiles. Although this fact might not necessarily hurt the IPO at hand, this is important because it is going to have a big impact on the company’s future. It is obvious that Facebook wants to beef up its mobile capabilities from the fact that it has been splurging enormous amounts of cash to acquire really successful companies in the mobile app space with  Instagram , Snaptu , Tagtile , Glancee , Gowalla , Strobe etc. All the products from companies, barring Instagram have been integrated with Facebook in terms of software and talent. While throwing money at a problem might not necessarily work, we will see how the company tackles the mobile segment. Facebook to charge money? While many of us might have fallen for those viral rumors on Facebook which claimed that the social networking site will charge its users money for using it, Facebook has been testing payment from users in very specific areas. Hold right there! There is no need to panic. Facebook is going to free for practical purposes as it states on its login page. It just seems to be testing this option in a New Zealand. Users in New Zealand have been offered the option to ‘highlight’ their posts for $2. Although not much has been confirmed about the pricing model and the overall strategy, Mia Garlick, Facebook’s spokesperson pointed out that, “We’re constantly testing new features across the site… This particular test is simply to gauge people’s interest in this method of sharing with their friends.”  It seems that the money can be paid by PayPal and Credit Card. This is just a one-off attempt to monetize very specific features and the Facebook team has to tread very carefully down this path. This Freemium model has worked brilliantly for Dropbox but the same might not be true for Facebook. The social networking giant has also announced its plans to join the cloud storage race by developing cloud storage options on Facebook. It will compete with Google Drive, Dropbox and Box. All in all, this going to be one IPO that everyone should watch out for. We will keep you updated on all the developments as soon as we get to know of them. What are your opinions about Facebook’s mobile strategy? Share them with us. Looking For A Social Media Agency?? – Contact WATConsult – India’s Leading Social Media Agency