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At first glance, Skype and Facebook have very little to do with each other. The former offers free phone calls over the Internet using the peer-to-peer technology that co-founders Niklas Zennstrom and Janus Friis pioneered with Kazaa, and the latter is a social-networking site that has virtually nothing to do with phone calls whatsoever (there's a conference-calling app, but that's a widget created by an outside company, Ottawa-based Iotum).
So what do Skype and Facebook have in common? Sky-high valuations, that's what. Back when eBay bought Skype for $4.1-billion U.S., the company seemed to be on top of the world, and while there were plenty of people (including yours truly) who criticized the value of the deal, there seemed to be no question that Skype was worth at least a couple of billion. And then came the $1.4-billion writedown that eBay took on Monday, effectively admitting that it paid way too much for the company.
Facebook now finds itself in situation similar to the one Skype was in back in 2005: being courted by major companies (Microsoft, Yahoo and Google, reportedly), with theoretical valuations up in the $10-billion range. The eBay writedown, however, has to be niggling away at some of those companies as they consider an investment in the social-networking site. Will they find themselves writing down a major chunk of that value at some future date? Microsoft CEO Steve Ballmer is already pouring some cold water on the red-hot Facebook phenomenon, saying there is a risk that such networks could be fads.
Should Facebook founder Mark Zuckerberg have taken the $1.4-billion that Yahoo is rumoured to have offered him for control of the company last year? That thought has to be going through his mind.
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B to the A to the R to the T from The left coast, Canada writes: Unless Facebook can keep the under 25 crowd glued to thier pages, or bring in a 'killer app', I think Facebook will go down as a fad. As a Facebooker in my thirties I'm pretty facebook out. Most friends that would use it have either come online or will remain offline due to the fact that they have no use for it. If they are online we've connected, caught up, and now only occasionally connect via facebook, instead choosing phone or email for ongoing communication.
- Posted 02/10/07 at 5:49 PM EDT | Alert an Editor | Link to Comment
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Douglas Cress from New York, United States writes: No way he's looking back! Zuckerberg will get a lot more than $1.4-billion in the deal.
You have to look how the younger generation is using this thing - they're glued to it.- Posted 02/10/07 at 6:53 PM EDT | Alert an Editor | Link to Comment
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Jordan Pohn from writes: Personally I feel the Facebook experience has already been somewhat diluted by the influx of customized applications (what fun is a personality comparison application when only 4/23,039,304 of my friends have the same application installed). Any potential suitor should be warned that further dilution of the product with more advertisements or zany "gift purchasing" ideas may take the application over the threshold and turn Facebook socializing into a peurile nuissance for users such as myself. At that point in time, many college-aged and older people will revert back to their classical MSN messenger ways until the next well-designed social networking application reaches critical mass. While I think that Facebook is slightly more than a fad, whoever decides to put in a purchase offer should base their offer on slightly modest ad revenue expectations.
- Posted 03/10/07 at 2:56 PM EDT | Alert an Editor | Link to Comment
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May C from Prince George, Canada writes: I believe that as a Facebook user that I am finding value in such a service because it allows me to keep in contact and connect with new friends in the industry that I wish to connect with that I normally would not otherwise be. I agree that I am finding that the appeal is somewhat wearing off but I still visit it several times daily to check up on what others are doing and make my latest move in Scrabulous but I don't think it will really die like a fad would though. As a networking tool, it's great.
- Posted 05/10/07 at 1:47 AM EDT | Alert an Editor | Link to Comment
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