# If Facebook ads are generally regarded as useless trash how will it monetize itself? **URL:** \ **Category:** In My Humble Opinion\ **Created:** [May 22, 2012, 12:30am UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674 "2012-05-22T00:30:15Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![Turble](https://avatars.discourse-cdn.com/v4/letter/t/8dc957/32.png) [@Turble](https://boards.straightdope.com/u/Turble)\ **Post date:** [May 22, 2012, 5:23pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/21 "2012-05-22T17:23:38Z")
I predict that FB will become the world’s biggest online poker site once the legalities are worked out. Good players will be drawn to it because of the huge numbers of weak players who convert from play money to real money games. Profits will be huge and the stock price will skyrocket once the implementation becomes imminent. ---
**Author:** ![Justin\_Bailey](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/justin_bailey/32/8792_2.png) [@Justin\_Bailey](https://boards.straightdope.com/u/Justin_Bailey)\ **Post date:** [May 22, 2012, 6:17pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/22 "2012-05-22T18:17:56Z")
> [@The\_wind\_of\_my\_soul](#): > > Facebook was launched in February 2004. I hadn’t even heard of the website until at least a year after it was launched, and I was a college student at the time. I think it’s too early to declare that Google Plus is dead. Facebook slowly rolled out to college students over the course of a year, so unless you went to school in the Boston area, you likely wouldn’t have heard of it. High school were allowed to join a few months after that. It wasn’t until nearly three years after the launch that Facebook allowed everyone to join. On the other hand, Google+ was open to everyone within three months. If they can’t get people excited after nine months of being open to everyone, they never will. ---
**Author:** ![hajario](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/hajario/32/171_2.png) [@hajario](https://boards.straightdope.com/u/hajario)\ **Post date:** [May 22, 2012, 6:33pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/23 "2012-05-22T18:33:04Z")
> [@Justin\_Bailey](#): > > If they can’t get people excited after nine months of being open to everyone, they never will. I think that that’s a huge overstatement but so far, I agree, things aren’t promising. ---
**Author:** ![The\_wind\_of\_my\_soul](https://avatars.discourse-cdn.com/v4/letter/t/ecc23a/32.png) [@The\_wind\_of\_my\_soul](https://boards.straightdope.com/u/The_wind_of_my_soul)\ **Post date:** [May 22, 2012, 6:42pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/24 "2012-05-22T18:42:47Z")
> [@Justin\_Bailey](#): > > Facebook slowly rolled out to college students over the course of a year, so unless you went to school in the Boston area, you likely wouldn’t have heard of it. High school were allowed to join a few months after that. It wasn’t until nearly three years after the launch that Facebook allowed everyone to join. > > On the other hand, Google+ was open to everyone within three months. > > If they can’t get people excited after nine months of being open to everyone, they never will. Valid points, and like **hajario** said, things don’t look real promising. But I still think you need to give it more time before you can denounce it as dead. I can’t think of many web sites or services that exploded with success right from the outset. ---
**Author:** ![HazelNutCoffee](https://avatars.discourse-cdn.com/v4/letter/h/ac91a4/32.png) [@HazelNutCoffee](https://boards.straightdope.com/u/HazelNutCoffee)\ **Post date:** [May 25, 2012, 10:41am UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/25 "2012-05-25T10:41:07Z")
Facebook had yet to hit me with an ad I’ve found relevant. Their favorite seems to be a dating agency for girls looking to marry for a US visa. ---
**Author:** ![Orange13](https://avatars.discourse-cdn.com/v4/letter/o/a88e57/32.png) [@Orange13](https://boards.straightdope.com/u/Orange13)\ **Post date:** [May 25, 2012, 1:20pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/26 "2012-05-25T13:20:15Z")
> [@Damuri\_Ajashi](#): > > Facebook is currently being valued at something like $100 per account, some people have multiple accounts and a lot fo those accounts are for people with very little disposable income. Here is where the reality check comes in for me. At what point does potential revenue (from ads, demographics, etc) substitute for actual assets? How does Facebook’s valuation exceed that of other corporations with real assets (there are many notables)? Why is Facebook different from other short-lived competitors? ---
**Author:** ![Hermitian](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/hermitian/32/470_2.png) [@Hermitian](https://boards.straightdope.com/u/Hermitian)\ **Post date:** [May 25, 2012, 1:50pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/27 "2012-05-25T13:50:22Z")
> [@astro](#): > > The notion of selling ads is apparently derailed by the fact that no one really pays attention to the awful Facebook ads ( I sure don’t)… Basically, most online ads are for stupid people. “No one in this world has ever lost money by underestimating the intelligence of the great masses of the plain people.” Henry Louis Mencken ---
**Author:** ![bucketybuck](https://avatars.discourse-cdn.com/v4/letter/b/898d66/32.png) [@bucketybuck](https://boards.straightdope.com/u/bucketybuck)\ **Post date:** [May 25, 2012, 2:07pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/28 "2012-05-25T14:07:31Z")
> [@Hermitian](#): > > Basically, most online ads are for stupid people. > > “No one in this world has ever lost money by underestimating the intelligence of the great masses of the plain people.” Henry Louis Mencken I can’t be on my own in this but when I am on places like Facebook, at this point I don’t even _see_ the ads. Seriously, for every webpage you can think off, all those pictures along the top and down the sides they no longer register in my line of sight. I know they are ads, and I won’t ever be clicking them, so these days they might as well not be there. So I laugh when I hear about targeted ads. They could be the most accurately targeted ads in history, as targeted ads go they could be goddamn works of art, they could be life changing in how targeted they are to me, and I still won’t be even looking at them\* never mind clicking the damn things. \*(one exception: ads with pictures of big tits.) ---
**Author:** ![hajario](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/hajario/32/171_2.png) [@hajario](https://boards.straightdope.com/u/hajario)\ **Post date:** [May 25, 2012, 2:11pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/29 "2012-05-25T14:11:23Z")
> [@bucketybuck](#): > > I can’t be on my own in this but when I am on places like Facebook, at this point I don’t even _see_ the ads. > > Seriously, for every webpage you can think off, all those pictures along the top and down the sides they no longer register in my line of sight. I know they are ads, and I won’t ever be clicking them, so these days they might as well not be there. Same here. They’re just a blur to me. I don’t think that I have ever even clicked on one, let alone bought something, ever. ---
**Author:** ![Martin\_Hyde](https://avatars.discourse-cdn.com/v4/letter/m/47e85d/32.png) [@Martin\_Hyde](https://boards.straightdope.com/u/Martin_Hyde)\ **Post date:** [May 25, 2012, 2:22pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/30 "2012-05-25T14:22:25Z")
I don’t doubt Facebook’s ability to become a long term, profitable business. They’re profitable now and with the right moves they can be consistently profitable. But the initial valuation was literally insane, it valued Facebook more than [Amazon.com](http://Amazon.com), which has millions of customers directly buying stuff from them every single hour of every single day. Companies like Walgreens and 3M are “Dividend Aristocrats” meaning these are stocks which have paid a dividend every year for 25+ years, **and** have increased their payout each year as well. Both combined would be valued less than Facebook’s initial valuation. These are established companies with consistent revenues and income that provide consistent and predictable shareholder value. They have consistently grown their revenue. Facebook has basically had a year or two in which they were in the green, and their most recent numbers show **declining** profits in an unproven, highly volatile industry. Facebook stock isn’t worthless, but Facebook was never a $100bn company and the investors who paid money thinking it was are why many people become rich in the market–because most investors are stupid. ---
**Author:** ![shiftless](https://avatars.discourse-cdn.com/v4/letter/s/e9c0ed/32.png) [@shiftless](https://boards.straightdope.com/u/shiftless)\ **Post date:** [May 25, 2012, 2:51pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/31 "2012-05-25T14:51:53Z")
I don’t think ads are the real asset at Facebook, it’s the database of users and their demographic information. Like Google, Facebook has a huge storehouse of information just waiting for someone to come along and find a use. For example, how are people responding to a new product that was released last week? Facebook and Google could harvest information, in different ways, that a business might be willing to pay for. Similar to credit reports, I think businesses would be very interested in getting their hands on individualized reports about taste and activities. Heck, that is probably going on now. ---
**Author:** ![Darth\_Panda](https://avatars.discourse-cdn.com/v4/letter/d/ee7513/32.png) [@Darth\_Panda](https://boards.straightdope.com/u/Darth_Panda)\ **Post date:** [May 25, 2012, 2:58pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/32 "2012-05-25T14:58:07Z")
Selling people’s data can be lucrative. Not in a conspiracy theory kind of way, just in the normal way that it’s done. > **[Your phone company is selling your personal data](https://money.cnn.com/2011/11/01/technology/verizon_att_sprint_tmobile_privacy/index.htm)** > > Verizon's new privacy policy allows it to sell your personal data to third-parties. AT&T, Sprint and T-Mobile also make money off of customers' data. ---
**Author:** ![Don\_t\_Call\_Me\_Shirley](https://avatars.discourse-cdn.com/v4/letter/d/f4b2a3/32.png) [@Don\_t\_Call\_Me\_Shirley](https://boards.straightdope.com/u/Don_t_Call_Me_Shirley)\ **Post date:** [May 25, 2012, 4:57pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/33 "2012-05-25T16:57:48Z")
Another problem for Facebook is that people are increasingly accessing it with mobile devices, which have much less real estate for ads. ---
**Author:** ![ftg](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ftg/32/2801_2.png) [@ftg](https://boards.straightdope.com/u/ftg)\ **Post date:** [May 26, 2012, 8:36pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/34 "2012-05-26T20:36:52Z")
> [@Darth\_Panda](#): > > Selling people’s data can be lucrative. Not in a conspiracy theory kind of way, just in the normal way that it’s done. As someone [once said](http://www.metafilter.com/95152/Userdriven-discontent#3256046): “If you are not paying for it, you’re not the customer; you’re the product being sold.” ([Cartoon version.](http://www.intrepid.com.au/wp-content/uploads/2011/11/Facebook-and-You-If-your-not-paing-for-it-youre-not-the-customer.-Youre-the-product-being-sold.png)) They are collecting a lot of information about you and selling it. There is huge money in this and what people naively put on Facebook is gold. Albeit _some_ of the data is sold to advertisers who then use it to target ads. But a lot goes to data aggregators and you don’t want to know what they do with that. When I look at someone else using Facebook, I am amazed. There are all those ads there. For some magical reason (!), I never see any. ---
**Author:** ![RaftPeople](https://avatars.discourse-cdn.com/v4/letter/r/6f9a4e/32.png) [@RaftPeople](https://boards.straightdope.com/u/RaftPeople)\ **Post date:** [May 28, 2012, 7:04pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/35 "2012-05-28T19:04:19Z")
Story on slahsdot is that facebook is working on it’s own [mobile phone](http://mobile.slashdot.org/story/12/05/28/1632226/is-facebook-working-on-a-smartphone). Is this a good move? Can they compete in this arena? It’s an interesting move that at first I thought was a bad move because of Apple and Android dominance and the competitiveness of the field. But they are apparently using Android and teaming up with HTC which means they aren’t trying to reinvent the wheel. Possibly they will create a device/ui that positions the user right at the center of their typical activities - boot up to facebook with integration to other key apps. I kind of like this move actually, there is an opportunity to do it right and create something that is compelling to consumers. ---
**Author:** ![ftg](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ftg/32/2801_2.png) [@ftg](https://boards.straightdope.com/u/ftg)\ **Post date:** [May 28, 2012, 8:14pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/36 "2012-05-28T20:14:38Z")
> [@RaftPeople](#): > > Story on slahsdot is that facebook is working on it’s own [mobile phone](http://mobile.slashdot.org/story/12/05/28/1632226/is-facebook-working-on-a-smartphone). > > Is this a good move? Can they compete in this arena? This is a double fail. The economics of entry into the smart phone market is horrible. Look at the recent failures of Nokia, Ericcson (for a while), and RIM, for example. And these are established companies. (Apple, as usual, is an exception. They were already in the hardware business, with retail channels and most importantly, a rabid fan base.) The market is already crowded with experienced players. Facebook is a niche software company with no experience in making and distributing hardware. It is doomed to failure. It is a double failure since it looks like they are going to buy Opera. Opera is the biggest mobile browser (which surprises a lot of people). This will kill Opera in the end. Which is a shame. I like it a lot. It’s the only browser that does tabs right. It’s like AOL buying Netscape. People keep looking at the insane profits Apple is making and think that that is the norm rather than the exception in the smart phone market. There’s only room for at most 1 big profit maker in this market. Facebook will not be it. ---
**Author:** ![RaftPeople](https://avatars.discourse-cdn.com/v4/letter/r/6f9a4e/32.png) [@RaftPeople](https://boards.straightdope.com/u/RaftPeople)\ **Post date:** [May 28, 2012, 9:20pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/37 "2012-05-28T21:20:50Z")
> [@ftg](#): > > This is a double fail. The economics of entry into the smart phone market is horrible. Look at the recent failures of Nokia, Ericcson (for a while), and RIM, for example. And these are established companies. (Apple, as usual, is an exception. They were already in the hardware business, with retail channels and most importantly, a rabid fan base.) I initially had the same reaction, but when I saw they are using Android and HTC it seemed different for two reasons. 1 - Android is a working product, they don’t have to invest a ton of money to create this. They just have to “personalize” it to a facebook centric ui. 2 - HTC is one of the top mobile phone mfg’s. Again, Facebook doesn’t need to reinvent the wheel here, if they use HTC’s expertise properly this could be a relatively low investment/low risk move. Why I think this can be different from the others you listed: Nokia/Windows - There is nothing compelling here - it’s a “me too” situation with nothing to compel a consumer to purchase one of these over the two other platforms with all of the mindshare. Ericcson - no opinion, I haven’t followed this company at all. RIM - Previous reasons for Blackberry popularity are basically nullified and now it’s looking like game over. Facebook - It could be (possibly) compelling to consumers to have a phone that boots up and is immediately right where they want to be (facebook) with other key apps tightly integrated so the experience, from a consumer standpoint, appears to be simpler and right where they want to be. Even if competing phones only require a click or a simple gesture to bring up facebook - to a consumer that one navigation action can (possibly) feel like it’s more work than the phone next to it that is just automatically right there. > [@](#): > > The market is already crowded with experienced players. Agreed. But it’s a constantly shifting landscape, I wouldn’t expect it to just remain static for very long. > [@](#): > > Facebook is a niche software company with no experience in making and distributing hardware. It is doomed to failure. This is not a compelling argument to me. The wireless providers want competition and they don’t really care where it comes from - if facebook created a phone that the consumers found interesting the wireless companies would want to use it against Apple to drive better deals. > [@](#): > > People keep looking at the insane profits Apple is making and think that that is the norm rather than the exception in the smart phone market. There’s only room for at most 1 big profit maker in this market. Facebook will not be it. Regardless of how difficult it is to make money in that competitive environment, my point was that I think they have a possibility of creating something compelling to consumers (based on current popularity of facebook). There aren’t too many companies in that position. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [May 30, 2012, 3:28pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/38 "2012-05-30T15:28:54Z")
> [@Orange13](#): > > Here is where the reality check comes in for me. > At what point does potential revenue (from ads, demographics, etc) substitute for actual assets? > How does Facebook’s valuation exceed that of other corporations with real assets (there are many notables)? > Why is Facebook different from other short-lived competitors? The notion is that you are betting on internetworking, whatever developments we see in that space will be led by facebook. If someone finally figures out how to make boatloads of cash off of this, then facebook will be ina position to get the lion’s share of that cash. There is a lot of inertia to prevent active facebook users from moving from facebook to other sites. Of course most facebook users are not so invested in facebook that they would feel a sense of loss if their accounts were scrubbed clean and they had to start all over again. IMHO, its like betting on internet news sites on the notion that someone will figure out how to monetize all the folks who get their news from the internet. > [@bucketybuck](#): > > I can’t be on my own in this but when I am on places like Facebook, at this point I don’t even _see_ the ads. > …They could be the most accurately targeted ads in history, as targeted ads go they could be goddamn works of art, they could be life changing in how targeted they are to me, and I still won’t be even looking at them\* never mind clicking the damn things. > > \*(one exception: ads with pictures of big tits.) Well, then that’s how they should be targetting ads at you. Your page should be inundadted with links to porn sites and strip clubs. > [@Martin\_Hyde](#): > > I don’t doubt Facebook’s ability to become a long term, profitable business. They’re profitable now and with the right moves they can be consistently profitable. But the initial valuation was literally insane, it valued Facebook more than [Amazon.com](http://Amazon.com), which has millions of customers directly buying stuff from them every single hour of every single day. …Facebook stock isn’t worthless, but Facebook was never a $100bn company and the investors who paid money thinking it was are why many people become rich in the market–because most investors are stupid. Two points. I agree that facebook has value but that the IPO was overpriced. You seem to be of the opinion that the typical retail investor is stupid at the same time you think of seem to advocate eliminating pensions for self directed reitrement accounts in other threads. > [@shiftless](#): > > I don’t think ads are the real asset at Facebook, it’s the database of users and their demographic information. Like Google, Facebook has a huge storehouse of information just waiting for someone to come along and find a use. For example, how are people responding to a new product that was released last week? Facebook and Google could harvest information, in different ways, that a business might be willing to pay for. Similar to credit reports, I think businesses would be very interested in getting their hands on individualized reports about taste and activities. Heck, that is probably going on now. Yeah and its not generating very much profit relative to the share price. ---
**Author:** ![Martin\_Hyde](https://avatars.discourse-cdn.com/v4/letter/m/47e85d/32.png) [@Martin\_Hyde](https://boards.straightdope.com/u/Martin_Hyde)\ **Post date:** [May 30, 2012, 4:39pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/39 "2012-05-30T16:39:50Z")
> [@Damuri\_Ajashi](#): > > I agree that facebook has value but that the IPO was overpriced. > > You seem to be of the opinion that the typical retail investor is stupid at the same time you think of seem to advocate eliminating pensions for self directed reitrement accounts in other threads. The typical retail investor **is** stupid. Have you read about the portion of baby boomers near retirement with **no** retirement savings. I don’t even mean the huge portion of them with massively underfunded retirement accounts, there is a sizable number of baby boomers with **no savings** for retirement. Unfortunately I don’t believe traditional pension plans are/were sustainable, at least in their current incarnation. I favor market-based plans, but I’ve been saying I consider IRAs and 401ks to mostly be a failure now. I think instead totally self-directed accounts should be like investing in a hedge fund, meaning only the wealthiest workers should have the option. Everyone else should have to invest in much more restrictive plans that have, for example, no option to take loans against the value of the plan and no option for early withdrawal aside from disability. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [May 31, 2012, 9:37pm UTC](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674/40 "2012-05-31T21:37:57Z")
> [@Martin\_Hyde](#): > > The typical retail investor **is** stupid. Have you read about the portion of baby boomers near retirement with **no** retirement savings. I don’t even mean the huge portion of them with massively underfunded retirement accounts, there is a sizable number of baby boomers with **no savings** for retirement. > > Unfortunately I don’t believe traditional pension plans are/were sustainable, at least in their current incarnation. I favor market-based plans, but I’ve been saying I consider IRAs and 401ks to mostly be a failure now. > > I think instead totally self-directed accounts should be like investing in a hedge fund, meaning only the wealthiest workers should have the option. Everyone else should have to invest in much more restrictive plans that have, for example, no option to take loans against the value of the plan and no option for early withdrawal aside from disability. Pensions work just fine in countries that have sensible pension regulations. For example much of Europe requires pensions to be fully funded at levels that an annuity company would be willing to guarantee the benefits (indeed many pensions are run through annuity companies). The sort of funding levels we require allows for all sorts of outrageous assumptions. Folks used to make more conservative assumptions until the corporate raiders of teh 1980’s made having fat pension accounts like putting a target on your back. [Previous page](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674.md?page=1) [Next page](https://boards.straightdope.com/t/if-facebook-ads-are-generally-regarded-as-useless-trash-how-will-it-monetize-itself/622674.md?page=3)