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Facebook Goes Public – Nine Things You Should Know About Facebook’s IPO

Facebook could be worth nearly $140 billion by today’s market close

The social network priced its shares at $38 apiece, valuing the company at $104 billion. The average first-day “pop” for a technology company is 32 percent; if Facebook follows that trend, it’ll be worth $137 billion by day’s end. But there’s little about Facebook that’s average, including its public offering. This is the technology’s biggest initial public offering and history’s second-biggest IPO, period, and it will raise about $16 billion. Statistics suggests that the first-day pop—if there is one—will be more modest than average.

A lot of the smart money is getting out

Early investors such as the venture capital firm Accel Partners are selling an unusually high number of shares.Nearly 60 percent of the stock sold today comes from insiders, compared to 37 percent for Google (GOOG) when it went public in 2004. Goldman Sachs (GS) is selling about half its stake, far more than the firm initially planned. “If you really thought that 12 months later the stock would be 50 percent higher, you wouldn’t leave that on the table,” Erik Gordon, a professor at the Ross School of Business at the University of Michigan, told Bloomberg News.

To justify its valuation, Facebook will need to annoy its users …

Thanks in large part to General Motors’s (GM)decision to de-friend Facebook, there are a lot of questions about the efficacy and future of Facebook’s ad-dominant revenue model. And it has high expectations to live up to: The $38 price gives Facebook a whopping 107 price-to-earnings ratio. (For comparison, Apple’s (AAPL) is around 13.) To dramatically boost ad revenues, the two best options are either to put more ads on the site—which would annoy users—or find more places to put ads. The latter means creating a network of ad inventory across the Web, much the way Google’s Doubleclick sells ads and places them on sites like that of the New York Times (NYT). This would give Facebook far greater reach, but could also give users the creeps. Imagine updating your Facebook status (“Really loving that new Carly Rae Jepsen song!”) and then seeing ads to buy the track Call Me Maybe at every site you visit.

… or do something besides advertising

Currently Facebook’s only source of non-ad revenue is its digital currency, Facebook Credits, which people use to buy virtual goods, such as tractors in FarmVille (ZNGA). During the first quarter of 2012, payments grew to make up almost 18 percent of Facebook’s revenue—close to $200 million in total. Overall, though, fewer than 2 percent of Facebook’s users have bought virtual goods with their payments option. There’s a lot of potential growth, in other words, along with hints that a big online operator such as Spotify may begin accepting Facebook Credits in the future.

Facebook has plenty of revenue options beyond payments and advertising

Facebook is a force: It accounts for 9 percent of all online visits in the U.S., according to Experian Hitwise, a company that measures website traffic. Hitwise also says that Americans spend an average of 20 minutes per Facebook visit. Worldwide, nearly 1 billion people have a Facebook profile. As investor Chris Dixon puts it, Facebook has real assets—including “a vast number of extremely engaged users, its social graph, Facebook Connect”—and should be able “to monetize through another business model,” apart from advertising. It could create the Social Smartphone, sell data analytics products, charge for higher-res photo and video storage, or perhaps hawk vintage Mark Zuckerberg hoodies.

There’s already a “Facebook Mafia”

Heard of the PayPal Mafia? Former executives from the online-payment provider have gone on to start big-time tech firms, such as LinkedIn (LNKD), Yammer, and Yelp (YELP). (And one member, Peter Thiel, cut the first big check for Facebook.) A Facebook Mafia has already emerged, and members have founded Asana, Path, andQuora. The Facebook Mafia is real, even though the name could use some work, says Dave Morin, Path’s chief executive officer, who previously developed Facebook’s development platform. “I guess we can’t escape from calling it that,” he says.

Facebook goes where Google won’t in photos

Facebook owns one of the largest photo repositories in the world, and its facial-recognition technology is getting a workout scanning them all, with more than 300 million photos uploaded per day. Facebook stores 60 billion images, a whopping 1.5 petabytes of data. For each uploaded photo, Facebook stores four images of different sizes. The site shows as many as 550,000 images per second. This is an area that has upset privacy critics and represents something that Facebook is willing to do that even Google isn’t: Google’s Eric Schmidt said last yearthat the company had built an app that would let people snap photos of others and identify who they are but decided not to release it, due to privacy concerns. Google and Facebook both have sophisticated facial-recognition technology, but Google requires users to opt into its photo-tagging service. Facebook users are included automatically.

Facebook’s new campus could be cursed

Late last year the social network moved into a 57-acre site in Menlo Park that was previously inhabited by Sun Microsystems. Sun’s fortunes soured shortly after the computer company took up residence there. The same thing has happened, in different times and places, to software-maker Borland, Silicon Graphics, and even Apple (which nearly went bankrupt three years after it moved into its current Cupertino, Calif., headquarters at 1 Infinite Loop). The good news: Companies that move into pre-existing campuses seem to fare better. Google, for instance, took up residence in SGI’s old digs.

Up north, Facebook is the only thing better than hockey

Facebook is one of the top two websites in every country except China. The social-networking site is most loved in Canada, where it wins 12 percent of all online visits.

Source: Businessweek.com

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Fashion Research Institute Collaborates with Intel Labs to Bring Premium Digital Content to Science Sim

“Content is King” has long been the mantra of the gurus of the Internet.  And now, Fashion Research Institute has teamed up with Intel Labs to provide users with a myriad of choices in premium digital content to help give those users a solid start to their Science Sim efforts.

Fashion Research Institute has been collaborating with Intel Labs since 2009, helping to push the limits of content development.

“Compelling content will drive the growth of virtual world grids; performance is essential to sustain that growth. But compelling content must be there first for the platform to host the business models to follow, including ours,” says FRI CEO Shenlei Winkler. “In particular, our research, which is supported by studying more than 65,000 new users to virtual worlds, shows that premium avatar customization content in particular aids in user uptake and deeper immersion to the platform”

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FRI provided Science Sim with six full avatars in various skin tones for male and females with multiple facial hair and makeup options, as well as a range of clothing, jewelry, shoes, and hairstyles. Additionally, FRI has provided landscaping, texture packs and buildings of various sorts.

“We were thrilled to have the opportunity to continue to collaborate with Intel Labs to bring over 800 items of inventory to the Science Sim project,” says Winkler.

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Along with recent performance enhancements, we are laying a foundation for further exploration of new problem solving methodologies. Fashion Research Institute is collaborating in this effort through their recent content contribution,” says Dr. Mic Bowman, Principal Engineer, Intel Labs.

Teach Parallel, the Intel Software Network TV, recently interviwed Dr. Mic Bowman, the principal engineer in Intel Labs, who leads the Virtual World Infrastructure research project, in which he discusses advances in Science Sim and the FRI content contribution. http://blip.tv/play/g5FLgoSJXgA%2Em4v

 

About Fashion Research Institute, Inc.: FRI is at the forefront of developing innovative design & merchandising solutions for the apparel industry.  They research and develop products and systems for the fashion industry that sweepingly address wasteful business and production practices. All items included in the Science Sim content library are covered by a license.  The class of the content determines the exact license. Scripts are covered by BSD, GPL, Creative Commons, and Public Domain licenses. All other content contributed is covered by Fashion Research Institute’s content license.

Science Sim is part of an evolution toward online 3D experiences that look, act and feel real. Sometimes dubbed the “3D internet,” Intel Labs refers to this technology trend as immersive connected experiences, or ICE. ScienceSim is differentiated from most virtual world environments
by its open source architecture. ScienceSim leverages open source building blocks (installation utilities, management tools, client viewers, etc.) based on OpenSimulator (OpenSim) software.

(Image courtesy Fashion Research Institute, Inc.)

Source: Hypergridbusiness.com

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