Archive for October, 2008
Financial Situation Not Dire at Facebook
Friday, October 31st, 2008This morning I posted about Mike Arrington’s article suggesting Facebook is almost in dire straits. At the time I suggested that things may not really be that bad and based on most reports, they aren’t. This afternoon Facebook contacted Venturebeat with a comment on the story:
As a matter of policy, we don’t comment on market speculation or rumor about our finances. Facebook is well-positioned both financially and within the market and any thoughtful attempt to model our business should reflect that. Our advertising business has great depth and breadth. While no ad business can ever be 100% recession proof, the breadth of our advertiser base and the innovative products we offer bolster our position in the current cycle. We’ve also been closely managing the business so we can continue to hire great people and scale. While we’ve achieved certain milestones, we are deeply committed to even greater business success in the future.
From the sound of it things are that bad. According to Caroline McCarthy the company has practically frozen its hiring for the time being and will remain at around 750 to 800, choosing not to hit its target of 1,000 employees by year-end. While the situation is not dire, it’s never a bad idea to get a little more cash while you can and that could explain Gideon Yu’s trip to Dubai.
The company won’t be going bankrupt anytime soon though and with the massive growth they are still experiencing I somehow doubt that raising a little more cash is anywhere close to impossible.
Facebook’s Heavy Halloween Facebook Load
Friday, October 31st, 2008Doug Beaver of Facebook posted an article earlier this afternoon explaining the massive amount of storage required to handle the user halloween photos. Each Halloween results in a whopping 20 percent increase of photo usage. What does that mean? Well, last year 124 million photos were uploaded over Halloween. This time around, that number could be double.
To prepare, the company has packed 40 terabytes of storage to prepare for the photos being uploaded. That’s a large amount of storage. To put it in comparison Doug Beaver wrote that “the words of all 20 million books in the Library of Congress could be digitized in about 20 terabytes of text. So we’re making room for the equivalent of two Libraries of Congress.”
That’s definitely an impressive feat and considering that the company has already surpassed 10 billion photos, this is just another test of the site’s scalability. Considering that the company is now growing internationally quicker then they are domestically, I’d imagine that they will start getting many other spikes as a result of various holidays taking place abroad.
Virgin Crew Fired After Insulting Passengers on Facebook
Friday, October 31st, 2008Thirteen Virgin Atlantic crew members have been fired after insulting passengers on the Facebook fan page for the airline. According to the BBC, the employees were calling passengers “chavs”. What is a chav exactly? I had no idea until I looked it up. According to Wikipedia:
Chav, or Charv/Charva, is a mainly derogatory slang term in the United Kingdom for a person whose lifestyle, branded casual clothing (especially if counterfeit), speech and/or mannerisms are perceived to be common, proletarian and vulgar. ‘Chav’ is often used as a stereotype to refer to white, poorly educated, aggressive youths, but youth and aggression are not the defining attributes of a ‘chav’. The term is similar to America’s ‘white trash’ stereotype.
Not only did they make derogatory comments about passengers but they “also reportedly claimed the planes were full of cockroaches and alleged the airline’s jet engines were replaced four times in one year.” Publicly discussing these things crossed the line and soon enough all thirteen employees found themselves jobless.
Lesson for company employees: acting unprofessionally via Facebook and having that content publicly accessible to your company will result in you losing your job. This is definitely not the first time and it isn’t the last time that this will happen. So for all of you that want to call people a “chav”, a “yo”, or whatever derogatory term you choose, Facebook is probably not the best place to be doing so. Honestly, you may want to ditch the habit all together!
Facebook is An Expensive Business, Perhaps Too Expensive
Friday, October 31st, 2008As I frequently write, Facebook has been growing at an insanely fast pace. The company has grown to become the largest social network worldwide and it doesn’t appear to be slowing. As such, even with over $250 million in the bank as of less than 12 months ago, the company may be searching for funding yet again according to Mike Arrington. How does he know this? Well he points to Gideo Yu, the company’s CEO, traveling to Dubai this week.
Perhaps Gideon just wanted to do a little indoor skiing! Probably not (although hopefully he had time for at least one run). The reality is that Arrington’s math definitely makes sense. The company put aside $100 million for servers earlier this year and is spending $10 million per month on employees. So how about all the money they are making from advertising?
While the company continues to grow and may surpass internal estimates provided by Zuckerberg earlier this year of close to $300 million, all the numbers don’t add up. How much are they burning through? With all the numbers that Arrington posted, it could be around $26 million per year and with close to 10 times that in the bank previously that may not be such a bad position.
The company is growing though and as their expenditures rise and Zuckerberg decides to hold off on focusing on monetization, raising another round of funding definitely begins to look like a good idea. Is the situation as dire as Arrington poses? I doubt it. Who can resist a little sensationalism once in a while? Arrington claims that revenues could fall $100 million short of estimates from a year ago.
These are all hypotheticals though and while I’d love to paint a drastic picture as well, there is other supporting evidence: a bad economy. Regardless of whether or not the company is strapped for cash, it’s never a bad idea to take more money at a $15 billion valuation. For now, we’ll wait and see what happens. Do you have a few million to invest in Facebook?
Facebook Kills iPhone Photo Uploads By Email
Friday, October 31st, 2008
Yesterday I received a message from someone who was frustrated because they could no longer upload photos via email. When they attempted to send from their iPhone they received the following message: “Sorry, we cannot support uploads sent via email. Upload photos from your iPhone with our free application, Facebook for iPhone:
[link to application]“.
My initial response was to ask if he had an iPhone and if he did why he wasn’t using the Facebook application. He admitted that he did but brought up a good point about why Facebook should enable uploading via email even with the availability of an application. The main reason to enable the service was to make it possible to upload the photo to many sites via one upload.
While I can in someway understand Facebook’s position of wanting to drive as many users as possible to install the application, flexibility is key. Even the people that want to upload their images via email most likely have the Facebook application also. The individual that contacted me about uploading photos admitted to having the application but said he just wanted to have the ability to upload to multiple sites.
It’s really not that big of a change and while Facebook may want to lock people into using their application, it’s a fairly restrictive model. Is Facebook going to re-enable upload via email? I’m skeptical of it but it would be the right thing to do. Personally, Facebook Photos is my primary image storage location but many people like to also share via Flickr. How do you store your photos? Did you noticed that Facebook removed iPhone email uploads or do you use the application to upload photos?
Facebook Upgrades Video Encoding
Friday, October 31st, 2008
Sometime last weekend it appears that Facebook upgraded the encoding of their video service from FLV files to H.264 with AAC for audio. So what does this mean? Well in simple terms Facebook now has better quality video. For those not up to date on the latest video specifications (I wasn’t when we were tipped off about this upgrade), check out the following description of H.264 provided by Adobe Labs:
H.264 is the next-generation video compression technology in the MPEG-4 standard, also known as MPEG-4 Part 10 (ISO/IEC 14496-10). H.264 delivers excellent video quality across the entire bandwidth spectrum — from 3G (Mobile phones) to HD (Broadcast) and everything in between. H.264 is now mandatory for the HD-DVD and Blu-ray specifications (the two formats for high-definition DVDs) and ratified in the latest versions of the DVB (Digital Video Broadcasters) and 3GPP (3rd Generation Partnership Project) standards.
So three cheers for a new and improved Facebook Video. It appears that this is part of the Flash Player 9 update but Facebook is one of the early implementers of this update. For those that decide to record videos through their webcam, the videos will still be encoded in FLV but anybody that uploads their own videos will receive the higher quality encoding.
Thanks to Michael Medley, author of the Facebook Video greasemonkey script that we previously wrote about, for tipping us off!
Facebook Sending DMCA Takedown Notices to Users?
Thursday, October 30th, 2008It looks like Facebook has entered a gray area when it comes to users’ personal videos. According to Techdirt Facebook is issuing DMCA takedown notices to users that have copyrighted music playing in the background of their videos. That Facebook has technology to automatically check for copyrighted material in videos is impressive in its own right but telling users that they can’t place music in their personal videos is ridiculous.
If a user makes a video public and begins actively promoting that video, they may end up crossing the line. There is definitely a line that ends up being crossed and something tells me that it may have to do with the number of users that have access to a given video. If these videos are private then the takedowns are absolutely absurd. It’s not like this automated filtering will prevent users from creating personal home videos.
Isn’t that what Facebook video is for … personal videos? I understand the concept of going to YouTube and posting a music video or a television show and that being illegal. If you were recording a Bar/Bat Mitzvah or any other party with music and wanted to keep and share the video for sentimental reasons, it would be insane to have someone come and tell you to take it down.
I would have to consult a lawyer at this point when it comes to the legality behind this but I could see this turning into a pretty serious debate. I’ll reach out to the digital media lawyers that I know to see what they have to say. What do you think about users receiving a DMCA notice? Is this crossing the line? Where is the line on this issue?
Update
One of the commenters has posted a copy of one of Facebook’s DMCA takedown notices. Here’s what it says:
Hello,
We have removed your video entitled “*******” uploaded at 11:37pm February 2nd, 2008. We did this because we learned that your video might include copyrighted material owned by a third party, such as a video clip or background audio.
If you are the copyright owner, or have permission from the rights holder to upload and distribute this material on Facebook, you may file a counter notice of alleged infringement by following the link below.
Please note that if you re-upload this video without filing a counter notice, or if you upload another video that infringes on the rights of a third party, our system will again remove the content. This could cause your access to the Facebook Video application to be disabled, or your Facebook account to be disabled.
To file a counter notice:
File a Counter NotificationFor Facebook’s video removal policy:
View the PolicyThe Facebook Team
copyright@facebook.com
Bono Teaches Lesson on Facebook Privacy
Thursday, October 30th, 2008Earlier this week Bono made headlines after photos of him partying with two 19 year old girls in St. Tropez surfaced on Facebook. The photos were taken by Andrea Feick and apparently were published to her profile. Sophos security has concluded that the reason these images surfaced was that Andrea Feick did not update her privacy settings and as a result, other people in her geographic network were able to view her profile and photos.
The National Business Review has pointed to a Facebook page which is publically viewable even to those not logged into Facebook. How are the photos viewable even to non-users? Well, they were posted to what has become a fan page for Andrea Feick, a previous unknown party planner. It’s unknown who actually created the fan page, but these appear to be copies of the original images that were initially posted.
Sophos described the exposure of Andrea’s photos as a “privacy flaw”. I’d actually call it an issue with people being unaware of the default privacy settings on Facebook. Unfortunately most users are unaware of Facebook’s default privacy settings. While granular privacy controls have become a default component of most large social networks, many users still fail to educate themselves about what settings are available.
Bono learned a lesson about hanging out with 19 year old girls. I’d imagine that most girls that age (or any age to be perfectly honest) would love to brag about hanging out with one of the best known celebrities worldwide. Facebook only helped to amplify the backlash followed by the media piling on. It’s unfortunate for Bono but I can’t say that I feel bad for him as he was partying on a yacht in St. Tropez.
Facebook Traffic Continues to Surge
Thursday, October 30th, 2008According to a comScore report published yesterday that shows Facebook’s global traffic continuing to surge past MySpace. While MySpace continues to attract more traffic domestically, that gap is closing rapidly. Currently there is no competing social network which has obtained the type of reach that Facebook has and currently there are no signs pointing toward a slowdown in Facebook’s growth.
The data suggests that 161 million unique visitors visited the site, far beyond the more than 110 million profiles that have been created on the site. That 50 million user gap suggests that Facebook still has plenty of room to grow. Additionally, tracking overall traffic can be misleading as a much smaller portion of users register and an even smaller portion successfully complete their profile.
Still, no matter what the break down is for gross users versus active users that complete their profile, Facebook continues to dominate. This is great news for the company and as Mark Zuckerberg has continued to highlight, they continue to focus on this growth as there is a ton of opportunity abroad for expansion.
One thing that hasn’t factored into these numbers is how MySpace music has impacted the growth of the site. We will have to wait until next month to find those numbers.
SpeedDate Buys and Switches “Who’s Online”
Thursday, October 30th, 2008Last week there was some buzz about Oregon Trail being acquired by SpeedDate and replacing it with their own application. It looks like that acquisition was only first in a series of acquisitions to come. Last night, users of “Who’s Online”, received the following message:
This email was sent by Who’s Online. You can disable emails here
<http://www.facebook.com/editaccount.php?notifications=&block=5952993979&h=0410b8f&t=1225351638&l=t>.
—
Thanks for using Who is Online. We are excited to announce that, as of
next week, Who is Online’s name and functionality will be changed to
SpeedDate. Data entered into the original app won’t be used anymore.
Soon you’ll be able to try SpeedDate, the fastest way to meet new
people, so stay tuned!
Thanks,
Who is OnlineP.S. If you want to opt-out of this app, instructions can be found here
<http://www.facebook.com/help.php?page=25>.
While the method is controversial, it has appeared to work for the company. Over the past month, the SpeedDate application has increased in popularity. Additionally, other acquire and switch applications including “Have You Ever???”, “Romantic Gifts”, and “Would You Rather?” have all grown in popularity.
While there hasn’t been enough time to track the impact on the Oregon Trail application, it appears that this strategy has been working for SpeedDate as they continue to grow in size. It’s pretty clear that the company is being transparent with the application switching so the move may not necessarily violate Facebook’s terms of service.
It will be interesting to see if this strategy continues to work for SpeedDate as the dating space on Facebook is most definitely a competitive one. Thanks to Martin Weigert for the heads up!
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