Facebook execs frequently claim they don’t share their users personal information with advertisers. They also always add that Facebook isn’t really that interested in advertising revenues. But that’s not correct, as the Facebook Quarterly Business Review: Q1 2010 reflects. Facebook, now cash positive, was said to earn somewhere between $600-700 million in revenues last year–up dramatically from the $150 million generated in 2007. The Quarterly estimates that Facebook should earn over $1 billion in 2010. How? “By growing multiple revenue sources, mostly around advertising,” it explains. Facebook is expected to earn some $350 million alone in 2010 from selling its ad services to big brands, with more growth expected. In the last year, Facebook has “invested heavily in expanding its brand advertising efforts by opening up offices in Paris, Madrid, Milan, Hamburg, Sydney, Stockholm, Toronto and Los Angeles.” The report says that Facebook will eventually earn some $20 billion a year, with a huge increase coming from big brand advertisers.
So-called performance advertising on Facebook [from social games, for example] is expected to bring in between $500-600 million this year. There will also be additional revenues from Facebook’s virtual currency [and soon from mobile and location based marketing as well].
Facebook’s users aren’t informed about the datamining that occurs on what they post and communicate, including to their social networks. We believe these systems require transparency and mechanisms of user control. And FTC and Congressional action.
