Facebook Application Sale Disappoints
Posted by Nick O'Neill on November 26th, 2007 4:03 PM
Last week, Simon Freed, James Ashton and Sam Hamilton, creators of the Advent calendar application, put their application up for sale on eBay. The application has over half a million users and over 22,000 daily users. Today, the auction winner bid $7,099. This amounts to one cent per user and approximately $0.33 per active user. Granted, this Facebook application has a short shelf life and the owner will have to figure out a way to drive users to another application in the next few weeks.
No Facebook applications have been sold for a significant amount yet. Currently, all of the money being generated is through advertising and custom application development. Most large companies have been sitting on the sidelines waiting for a first mover to hop in and snatch up an application for a significant amount. Unfotunately that hasn’t happened. Just as Facebook has an unproven advertising model, so do Facebook applications.
I was speaking with Caroline McCarthy of CNet this afternoon and she suggested that potential buyers may be stalling due to recent economic news. Whether or not the economy is the reason, no large acquisitions have taken place yet but there has been fair amount invested. Do you think any Facebook applications will be acquired for a significant amount?
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As other social networks increasingly incorporate user applications, investors will be looking for applications that have established a foothold in numerous networks. Focussing purely on Facebook would be a bad investment
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(except that Nick still believes it to be legit!).
Someone bought that POS for $20K and what, go look, they have done nothing, in months, to it?
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