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	<title>Comments on: What would Facebook look like if it sold out to ads? Click here to see&#8230;</title>
	<atom:link href="http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/feed/" rel="self" type="application/rss+xml" />
	<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/</link>
	<description>Essays on viral marketing, freemium, and social gaming</description>
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		<title>By: Andrew Chen (CoNotes)</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-2293</link>
		<dc:creator>Andrew Chen (CoNotes)</dc:creator>
		<pubDate>Wed, 12 Nov 2008 06:27:14 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-2293</guid>
		<description>What do you think the chances are that Facebook&#039;s primary revenue plan is to become a hosted application platform?&lt;br&gt;&lt;br&gt;Their moves over the past 2 years seem to indicate this is where they plan on going.  Perhaps charging partners a fee per user?</description>
		<content:encoded><![CDATA[<p>What do you think the chances are that Facebook&#39;s primary revenue plan is to become a hosted application platform?</p>
<p>Their moves over the past 2 years seem to indicate this is where they plan on going.  Perhaps charging partners a fee per user?</p>
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		<title>By: Andrew Chen (CoNotes)</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-1168</link>
		<dc:creator>Andrew Chen (CoNotes)</dc:creator>
		<pubDate>Wed, 12 Nov 2008 05:27:14 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-1168</guid>
		<description>What do you think the chances are that Facebook primary revenue plan is to become a hosted application platform?&lt;br&gt;&lt;br&gt;Their moves over the past 2 years seem to indicate this is where they plan on going.  Perhaps charging partners a fee per user?</description>
		<content:encoded><![CDATA[<p>What do you think the chances are that Facebook primary revenue plan is to become a hosted application platform?</p>
<p>Their moves over the past 2 years seem to indicate this is where they plan on going.  Perhaps charging partners a fee per user?</p>
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		<title>By: Andrew Chen</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-1154</link>
		<dc:creator>Andrew Chen</dc:creator>
		<pubDate>Fri, 07 Nov 2008 03:36:01 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-1154</guid>
		<description>see the reply I write above :)</description>
		<content:encoded><![CDATA[<p>see the reply I write above <img src='http://andrewchenblog.com/wp-includes/images/smilies/icon_smile.gif' alt=':)' class='wp-smiley' /> </p>
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		<title>By: Andrew Chen</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-1153</link>
		<dc:creator>Andrew Chen</dc:creator>
		<pubDate>Fri, 07 Nov 2008 03:35:42 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-1153</guid>
		<description>i think charging ALL users is too coarse of a solution. You have to remember that as a communication medium, a lot of the inherent value comes from other people on the site. Remember Metcalfe&#039;s law, which said that the value of the network grows exponentially as you add nodes? Well the reverse is also true, and if you lose members you are exponentially destroying value, ouch! I write more about this here: &lt;a href=&quot;http://andrewchenblog.com/2008/05/19/social-network-death-spiral-how-metcalfes-law-can-work-against-you/&quot;&gt;http://andrewchenblog.com/2008/05/19/social-net...&lt;/a&gt;&lt;br&gt;&lt;br&gt;So I think the major point would be to extract money from users who are willing to pay to use Facebook, but leave the people who wouldn&#039;t pay alone. The challenge is in price discriminating the former from the latter, while still getting everyone to come back to your site :)&lt;br&gt;&lt;br&gt;Now don&#039;t get me wrong, you could absolutely generate a ton of value from charging people, and a lot of folks would stay. But you should also remember that Facebook raised a TON of money and that anything other than a massive multi-billion dollar homerun is a failure case.</description>
		<content:encoded><![CDATA[<p>i think charging ALL users is too coarse of a solution. You have to remember that as a communication medium, a lot of the inherent value comes from other people on the site. Remember Metcalfe&#39;s law, which said that the value of the network grows exponentially as you add nodes? Well the reverse is also true, and if you lose members you are exponentially destroying value, ouch! I write more about this here: <a href="http://andrewchenblog.com/2008/05/19/social-network-death-spiral-how-metcalfes-law-can-work-against-you/"></a><a href="http://andrewchenblog.com/2008/05/19/social-net.." rel="nofollow">http://andrewchenblog.com/2008/05/19/social-net..</a>.</p>
<p>So I think the major point would be to extract money from users who are willing to pay to use Facebook, but leave the people who wouldn&#39;t pay alone. The challenge is in price discriminating the former from the latter, while still getting everyone to come back to your site <img src='http://andrewchenblog.com/wp-includes/images/smilies/icon_smile.gif' alt=':)' class='wp-smiley' /> </p>
<p>Now don&#39;t get me wrong, you could absolutely generate a ton of value from charging people, and a lot of folks would stay. But you should also remember that Facebook raised a TON of money and that anything other than a massive multi-billion dollar homerun is a failure case.</p>
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		<title>By: Andrew Chen</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-1152</link>
		<dc:creator>Andrew Chen</dc:creator>
		<pubDate>Fri, 07 Nov 2008 03:17:59 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-1152</guid>
		<description>:)&lt;br&gt;&lt;br&gt;thanks for stopping by Rohit! Hope all is well.</description>
		<content:encoded><![CDATA[<p> <img src='http://andrewchenblog.com/wp-includes/images/smilies/icon_smile.gif' alt=':)' class='wp-smiley' /> </p>
<p>thanks for stopping by Rohit! Hope all is well.</p>
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		<title>By: rohit</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-1148</link>
		<dc:creator>rohit</dc:creator>
		<pubDate>Wed, 05 Nov 2008 16:58:43 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-1148</guid>
		<description>&quot;In fact, more complex technology and coining terms like “social graph” will only hurt, not help, in realizing the monetization potential around Facebook. &quot;&lt;br&gt;&lt;br&gt;And this is the money line that applies to more properties than just fb.</description>
		<content:encoded><![CDATA[<p>&#8220;In fact, more complex technology and coining terms like “social graph” will only hurt, not help, in realizing the monetization potential around Facebook. &#8220;</p>
<p>And this is the money line that applies to more properties than just fb.</p>
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		<title>By: jeffwong</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-1147</link>
		<dc:creator>jeffwong</dc:creator>
		<pubDate>Wed, 05 Nov 2008 13:09:41 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-1147</guid>
		<description>$10 a year.  Now that people have experienced FB for free, they can decide if it&#039;s useful and meaningful enough in their life to pay for it.  Due to network effects, it&#039;s unlikely everyone will move.&lt;br&gt;&lt;br&gt;I&#039;d sure as hell pay it.  FB told me when my cousin&#039;s had babies and when my niece moved to Cornell.  A great way of overcoming grudges of our parents.</description>
		<content:encoded><![CDATA[<p>$10 a year.  Now that people have experienced FB for free, they can decide if it&#39;s useful and meaningful enough in their life to pay for it.  Due to network effects, it&#39;s unlikely everyone will move.</p>
<p>I&#39;d sure as hell pay it.  FB told me when my cousin&#39;s had babies and when my niece moved to Cornell.  A great way of overcoming grudges of our parents.</p>
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		<title>By: iamabuzzkilliguess</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-1146</link>
		<dc:creator>iamabuzzkilliguess</dc:creator>
		<pubDate>Wed, 05 Nov 2008 10:16:40 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-1146</guid>
		<description>The idyllic notions of social apps - free or mostly free - will experience the ad revenue pendulum soon enough.  Everyone knows its coming.&lt;br&gt;&lt;br&gt;&lt;br&gt;I&#039;ve always wondered where online advertising is going and have maintained that it is simply not sustainable 3 - 4 years out.  We&#039;re heading in that direction.  Web companies are going to have to start charging for the most basic functions and everyone will come back to reality.&lt;br&gt;&lt;br&gt;How about just charging users $1/month?  Don&#039;t they have millions of users?  Does everything have to be ad based?  Certainly, that&#039;s what investors are hoping for - as well as the FB founders; however, I&#039;m not even sure that people even see ads when they go online.  I have to believe that most folks are at least a little like me - they have filtered ads mentally, that they don&#039;t even see them anymore.  They&#039;ve trained their eyes to naturally seek meaningful content.  &lt;br&gt;&lt;br&gt;Are we talking about the Joe Plumber Hockey Mom who is an infrequent web user?  I have to think that they&#039;re the same way or will be over time.  Unless forced - like with a DVD or television commercial, they won&#039;t look at them.  Going three or four years out, what is the sustainable revenue model here?  Will sites start sponsoring buttons - in other words, to get this certain piece of functionality, the user has to click on the HP-sponsored button?&lt;br&gt;&lt;br&gt;Going back to a pay model, perhaps users will be paying on a per click basis for certain functions within social apps and ad-hacks will be relegated to more traditional means?  Alternatively, advertisers will only be paying for splashes (mind/eye-space), and always paying a very high premium for clicks.</description>
		<content:encoded><![CDATA[<p>The idyllic notions of social apps &#8211; free or mostly free &#8211; will experience the ad revenue pendulum soon enough.  Everyone knows its coming.</p>
<p>I&#39;ve always wondered where online advertising is going and have maintained that it is simply not sustainable 3 &#8211; 4 years out.  We&#39;re heading in that direction.  Web companies are going to have to start charging for the most basic functions and everyone will come back to reality.</p>
<p>How about just charging users $1/month?  Don&#39;t they have millions of users?  Does everything have to be ad based?  Certainly, that&#39;s what investors are hoping for &#8211; as well as the FB founders; however, I&#39;m not even sure that people even see ads when they go online.  I have to believe that most folks are at least a little like me &#8211; they have filtered ads mentally, that they don&#39;t even see them anymore.  They&#39;ve trained their eyes to naturally seek meaningful content.  </p>
<p>Are we talking about the Joe Plumber Hockey Mom who is an infrequent web user?  I have to think that they&#39;re the same way or will be over time.  Unless forced &#8211; like with a DVD or television commercial, they won&#39;t look at them.  Going three or four years out, what is the sustainable revenue model here?  Will sites start sponsoring buttons &#8211; in other words, to get this certain piece of functionality, the user has to click on the HP-sponsored button?</p>
<p>Going back to a pay model, perhaps users will be paying on a per click basis for certain functions within social apps and ad-hacks will be relegated to more traditional means?  Alternatively, advertisers will only be paying for splashes (mind/eye-space), and always paying a very high premium for clicks.</p>
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		<title>By: devinreams</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-1145</link>
		<dc:creator>devinreams</dc:creator>
		<pubDate>Wed, 05 Nov 2008 01:16:43 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-1145</guid>
		<description>Hah I remember doing some &#039;fuzzy math&#039; on how over 1/4 of MySpace is ads. &lt;a href=&quot;http://mindaverse.com/2006/02/08/myspace-ads-suck/&quot;&gt;http://mindaverse.com/2006/02/08/myspace-ads-suck/&lt;/a&gt;&lt;br&gt;&lt;br&gt;MySpace was my immediate response to this title, too. ;)</description>
		<content:encoded><![CDATA[<p>Hah I remember doing some &#39;fuzzy math&#39; on how over 1/4 of MySpace is ads. <a href="http://mindaverse.com/2006/02/08/myspace-ads-suck/">http://mindaverse.com/2006/02/08/myspace-ads-suck/</a></p>
<p>MySpace was my immediate response to this title, too. <img src='http://andrewchenblog.com/wp-includes/images/smilies/icon_wink.gif' alt=';)' class='wp-smiley' /> </p>
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		<title>By: Andrew Chen</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-1144</link>
		<dc:creator>Andrew Chen</dc:creator>
		<pubDate>Tue, 04 Nov 2008 21:43:17 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-1144</guid>
		<description>btw, can you shoot me an email at voodoo at gmail? I want to ask you something. Thanks!</description>
		<content:encoded><![CDATA[<p>btw, can you shoot me an email at voodoo at gmail? I want to ask you something. Thanks!</p>
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		<title>By: Annalise</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-1143</link>
		<dc:creator>Annalise</dc:creator>
		<pubDate>Tue, 04 Nov 2008 18:55:52 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-1143</guid>
		<description>&lt;a href=&quot;http://HopOnThis.com&quot;&gt;HopOnThis.com&lt;/a&gt; is eZanga.com’s (a search engine specializing in pay-per-click advertising) social network. They offer free blogging, unlimited photos, and many more features. Once you are an active member, HopOnThis rewards you with points (for posting comments, inviting friends, blogging, etc) you can trade in for cash and prizes. They also offer features such as page personalization, drag-and-drop features, unlimited space for photos, and much more.</description>
		<content:encoded><![CDATA[<p><a href="http://HopOnThis.com">HopOnThis.com</a> is eZanga.com’s (a search engine specializing in pay-per-click advertising) social network. They offer free blogging, unlimited photos, and many more features. Once you are an active member, HopOnThis rewards you with points (for posting comments, inviting friends, blogging, etc) you can trade in for cash and prizes. They also offer features such as page personalization, drag-and-drop features, unlimited space for photos, and much more.</p>
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		<title>By: Andrew Chen</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-1142</link>
		<dc:creator>Andrew Chen</dc:creator>
		<pubDate>Tue, 04 Nov 2008 16:20:20 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-1142</guid>
		<description>All the elements of the screenshot are scaped off of MySpace, so you were 1/2 right!</description>
		<content:encoded><![CDATA[<p>All the elements of the screenshot are scaped off of MySpace, so you were 1/2 right!</p>
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		<title>By: Andrew Chen</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-1141</link>
		<dc:creator>Andrew Chen</dc:creator>
		<pubDate>Tue, 04 Nov 2008 16:19:55 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-1141</guid>
		<description>i &lt;3 imvu</description>
		<content:encoded><![CDATA[<p>i &lt;3 imvu</p>
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		<title>By: Andrew Chen</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-1140</link>
		<dc:creator>Andrew Chen</dc:creator>
		<pubDate>Tue, 04 Nov 2008 16:19:43 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-1140</guid>
		<description>re: netflix-data mining approach to affiliate transactions, I just don&#039;t think that&#039;ll work. It&#039;s absolutely a gearhead approach to the problem, which would make it attractive to Facebook, but also much riskier. The problem is the lack of commercial intent on Facebook, and given the low % payouts of affiliates, I think it&#039;d lead to an OK supplement of revenue but certainly not multi-billion revenues.</description>
		<content:encoded><![CDATA[<p>re: netflix-data mining approach to affiliate transactions, I just don&#39;t think that&#39;ll work. It&#39;s absolutely a gearhead approach to the problem, which would make it attractive to Facebook, but also much riskier. The problem is the lack of commercial intent on Facebook, and given the low % payouts of affiliates, I think it&#39;d lead to an OK supplement of revenue but certainly not multi-billion revenues.</p>
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		<title>By: Andrew Chen</title>
		<link>http://andrewchenblog.com/2008/11/04/what-would-facebook-look-like-if-it-sold-out-to-ads-click-here-to-see/comment-page-1/#comment-1139</link>
		<dc:creator>Andrew Chen</dc:creator>
		<pubDate>Tue, 04 Nov 2008 16:17:18 +0000</pubDate>
		<guid isPermaLink="false">http://andrewchenblog.com/?p=751#comment-1139</guid>
		<description>i think they are just extremists on the user experience, which has served them well ;-)&lt;br&gt;&lt;br&gt;David, your myspace nature is coming to light!</description>
		<content:encoded><![CDATA[<p>i think they are just extremists on the user experience, which has served them well <img src='http://andrewchenblog.com/wp-includes/images/smilies/icon_wink.gif' alt=';-)' class='wp-smiley' /> </p>
<p>David, your myspace nature is coming to light!</p>
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