Monday, March 19, 2012

10 Reasons facebook Users Resent Their IPO

The Internet is unlike anything we’ve ever had before as far as business models. Many times the people that own and run the company have all of the power, and make all of the money. However, in regards to Facebook that may not be the case this time. Check out 10 reasons Facebook users resent their IPO.

  1. Their growth is due to the users: People feel like all of the money made by Facebook is due to the information that they provide and the time that they spend using Facebook. If everyone decided to use another social website, Facebook would be worthless. It’s estimated that 12% of their overall worth is made from online gaming like Farmville and Café World. They reel you in by letting you play for free, but then ask you to pay if you want to continue playing the game.
  2. No women on the board of directors: There’s a movement called 2020 Women on Board which is a group that is trying to get companies to get on board by making sure that at least 20 percent of the people on their board of directors are women by the year 2020. Users are especially irritated with Facebook because women make up a large percentage of the users of Facebook yet there are no women on the board of directors. This campaign is challenging Zuckerberg to appoint a woman to the board before the company goes public in May and then to work toward the 20 percent by 2020.
  3. Targeted selling away from the site: Facebook users are worried that Facebook sells adverts based on the information that they have gathered about their users on other sites. There are laws governing this and they are getting stricter. Do you want to get bombarded with ads for every site you’ve ever shopped at? All of this information is being collected and since other sites now have the ‘like’ button that all ties that information back to Facebook and there stash of information on you and everyone else.
  4. Users versus stockholders: The concern is that the way Facebook works today will change because they will be more interested in the bottom line to please the stockholders instead of pleasing the users. The users are free to walk away at any time and move to another social site. Millions have already left Facebook because of the talk of the IPO as well as privacy concerns. If they make their users mad and they leave, then where would they be?
  5. More commercialization: Users worry that the landscape of Facebook will change and have more advertising so that they can increase the bottom line. Most people tolerate some advertising, but there will come a time when enough is enough. Zuckerberg has indicated to everyone up front that he is more interested in spending the money raised by the IPO to add great things to Facebook and that he is willing to pay for great people to be innovative.
  6. Selling the users’ info: Whereas other companies actually sell a product, Facebook is selling the information of their users. People are trying to decide how they feel about other people getting rich selling their private information.
  7. Decrease in Facebook appeal: Why is the value of Facebook going down when they are preparing to take it public? Users are disgruntled with the lack of innovation that they’ve seen and are thinking about taking their information elsewhere.
  8. Zuckerberg is a sellout: Fans of Facebook feel like Zuckerberg who is 27 is one of them. He started Facebook to facilitate communications between students and this social rocket took off from there. Now that Zuckerberg is taking the company public users feel like he is cashing out and leaving them behind. Zuckerberg himself said this was never supposed to be a company.
  9. Everyday users can’t buy shares: The way the market works is that initial offerings go to mutual funds, major investors and those that have deep pockets. The everyday user will have to wait until the price on the shares gets driven up by all of those people to even hope to buy any shares.
  10. Overpriced Facebook: Many feel that they are overpricing the value of Facebook. They are setting them up to fail. If the average Facebook user was lucky enough to buy shares they will be hard pressed to even get out what they bought the shares for in the first place.
Taken From Internet Providers

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