With the complete and utter tanking of the IPO for Facebook, the struggling of Google+ to take off and the literally hundreds of new Social Networking presences cropping up almost on a daily basis the question of the Bubble Bursting is very much so justified. For years experts have been calling for the dominance of the Social Search and that Social Networking would be the foundation of Web 3.0 but with so much gloom and doom out there about the viability of Social Networking right now…does it stand a chance?
The Facebook IPO Debacle is becoming well documented as the worst IPO of the past Decade (see the Bloomberg Story here) but I think that this one is a bit of an strange problem as it had been anticipated for so long as something that was going to happen. There was calls for the IPO to happen shortly after the LinkedIn IPO but it took almost a full year before Facebook came onto the scene. LinkedIn on opening day came in with a $75 share price and while they had some struggles as of June 4, 2012 they are worth just over $91.50 (to me that is pretty solid gain).
So really what happened with Facebook as on paper, they is far more to say about the potential of a Social Network that supposedly touches the lives of 900 Million users as compared to the steady but much slower growth of LinkedIn which is anticipating hitting 500 million users by 2018.
I see there being two major differences:
- Ad Revenues: Facebook is almost 100% driven by ad revenues, sure that accounts for $9.51 per user in Ad Revenue before the IPO that still accounted for nearly $3.8 Billion but that is it…a one trick pony. LinkedIn sees the vast majority of its revenue not from the $0.30 per user in ad Revenue but from a solid percentage leveraging its Premium Subscriptions that range from $20.00 per month to $500.00 per month (for their Talent Pro Recruiter package).
- Consumer vs. Corporate: I think that this speaks volumes to the major difference between the two Social Networks. I personally work hard to keep my Personal Life at arms Length from my Professional Life but in recent weeks I have been seeing more and more spillage. That is not the case though…we are still in fairly dark economic times and finding and keeping a job is much higher on peoples wish list than posting a high score in Bejeweled Blitz or expanding their Farmville Account!
The reality is it not a fair comparison but I really don’t think that the Social Bubble has burst, deflated a little sure but far from burst. Caution is the word of the day if you are looking at Social Media as a financial investment in their stocks but to each of us…the ability to connect, convert and cash in on a strong Social Presence is not only possible…it is imperative to the continued growth and stability of the Social Networking Bubble…errr…Business Model.
As for those new or emerging Social Networks…well here are a few Stats for you:
- Facebook Users: 901,000,000 (Feb 2012)
- MySpace Users: 262,000,000 (Mar 2012)
- Google+ Users: 170,000,000 (Mar 2012)
- LinkedIn Users: 146,000,000 (Apr 2012)
- Twitter Users: 140,000,000 (March 2012)
- Pinterest Users: 90,000,000 (Apr 2012)
- So.cl Users: ???? (Doors opened May 2012)
- Xing Users: 12,000,000 (Apr 2012)
The question is…how many of those users actually use all 5 on a regular basis? Beyond Pinterest which I am still trying to understand…I am on the top 4 daily and I would suspect that I am not alone when it comes to the Professionally Connected.
Well, Monday is here again…it is time to start it all over again. Have a great week everyone!
Chris J Powell