Facebook's $1B revenues: Now keep it up

Facebook may pull in an excess of US$1 billion in revenues, according to estimates and poking around on behalf of industry blog Inside Facebook. That's an increase from the same publication's estimate of US$700 million last year.

Facebook board member Marc Andreessen said last year that he projected the company would break US$500 million revenue in 2009, and that it had the potential to be a billion-dollar company already, but that it was acting conservatively.

(Naturally, Facebook says that as a privately held company it doesn't disclose its financials.)

What can Facebook credit this big jump in revenue to? It's all about the Social Ads program. Facebook ditched banner ads altogether> earlier this year when its longstanding ad partnership with Microsoft ran out and has chosen to focus on its edgier "engagement ads" program instead--and often these are sold by encouraging brands to promote their presence on Facebook with ad space.

However accurate these new estimates from Inside Facebook are, Facebook is certainly making money--and it's making money because the Facebook "fan page" and complementary ad space to promote it are the hottest ticket in brand marketing right now. They won't always be, and Facebook will have to maintain that front-runner status in plenty of advertising innovations down the road as the industry evolves faster than ever.

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Plus, it's well-known that some of the biggest buyers of Facebook advertisements are social games companies looking to pull in more players: how long can they, in turn, keep up their place in the sun? Critics have long since pointed out the number of third-party companies that are effectively dependent on Facebook for traction and revenue, but the reverse is likely true as well.

Facebook has a potentially lucrative new revenue stream emerging when its virtual currency system, Facebook Credits, launches in full--Facebook takes a 30 percent cut of all proceeds. But the developer world isn't totally sold, and the product has grown far more niche from the days when it was rumored to be a "PayPal killer." As Inside Facebook points out, advertising is still the core of the company's business model. And here, it has to stay ahead of the pack more than ever.

Source: ZDNetAsia

Facebook shuts down malicious fake profiles

Facebook on Thursday fended off an attack in which multiple identical profiles were created to spread malware.

Antivirus provider AVG Technologies said users of its LinkScanner service detected numerous profiles that were identical except with different names and each included a link to what was represented as a home video but which instead displayed a fake antivirus alert when clicked. The scams are designed to trick people into paying for software they don't need, to get credit card information from victims for identity fraud purposes, and often to install spyware on the computer.

"Clearly, the Data Snatchers have found a way to automate the creation of Facebook accounts, which means they've found a way to bypass the Facebook Captcha," Roger Thompson, chief of research at AVG, wrote in a blog post. Successfully translating a Captcha, a hard-to-read image of letters supposed to ensure that a human is involved, is required for a new account.

The malicious link was blacklisted by the major Web browsers and Facebook was blocking the URL from being shared on its site, said Facebook spokesman Simon Axten. Meanwhile, the company was working to identify all the fake accounts and disable them, he added.

Axten disagreed with the AVG speculation that the Captcha system had been broken.

"We're looking into how these accounts were created, but it's very likely that the sign-up process was manual, or that the person behind the attack farmed out the Captchas to be solved by humans for a price," Axten wrote in an e-mail.

For its Captcha system Facebook uses ReCaptcha, "which was recently acquired by Google and is about as well-regarded a Captcha provider as there is," he said.

Source: ZDNetAsia

Downed Facebook accounts still haven't returned

Something is really odd here.

As a reporter covering Facebook, I do get the occasional cranky complaints from members who, for one reason or another, are experiencing errors when they try to access their accounts.

But it's never been anything like the past week, with a steady stream of e-mails continuing to come in from Facebook members who say they remain shut out of their accounts--despite assurance from Facebook that profiles have not been deleted and that the company is working on the problem.

"This is now seven days and counting," an e-mail sent on Saturday morning read. "It's beyond ridiculous and extremely frustrating."

"The experience completely reversed the Facebook opinion and experience for me," one reader complained. "I see many people bitch and complain, many more beg and a few threaten. To me, the route to take is fairly obvious. Mark Zuckerberg on his own page invites democratic input from Facebook users in one of his most recent videos. Given that statement especially, I find the way their user base is being treated with respect to their disabled account policy hypocritical at best."

"My account has now been held hostage for a week," another reader wrote. "Some of my friends think that I have deleted (my profile) or even blocked them... None of my friends or family can see my profile or even find it in search. It's as if I simply deleted my account or blocked all of them from seeing it without even a word."

Some users have started threads on Get Satisfaction and Yahoo Answers. A few others have pointed me to blogs and YouTube channels devoted to the subject.

The inaccessible accounts appear to be limited to a very small subset of Facebook's over 300 million active users, which means that it's not a large-scale issue for the health of the site.

Facebook is supported by neither subscription money or taxpayer dollars (though it wouldn't have advertising revenue without its users) so there's an argument to be made that users shouldn't be complaining about something they don't pay for. But that's an argument that many of the people who have come to rely on Facebook as a channel of communication simply don't buy.

Whether the string of complaints is warranted or not, Facebook hasn't disclosed exactly what's caused the "extended maintenance issue", and that's what I find puzzling.

Source: ZDNetAsia