• +353-1-416-8900(GMT OFFICE HOURS)
  • 1-800-526-8630(US/CAN TOLL FREE)
  • 1-917-300-0470(EST OFFICE HOURS)
Facebook: Pot of Gold or House of Cards? Product Image

Facebook: Pot of Gold or House of Cards?

  • Published: June 2012
  • 224 Pages
  • Generator Research Limited

FEATURED COMPANIES

  • Google+
  • LinkedIn
  • Mixi
  • Pinterest
  • QZone
  • RenRen
  • MORE

Facebook provides major value benefits to approaching 1 billion users around the globe. The company's service has also played an important role in catalyzing political change throughout the Arab world, and elsewhere, with long-run economic benefits that are incalculable.

We project that Facebook's worldwide user base will have grown to 1.4 billion by the end of 2016: no other company can boast a customer base that compares with this: when measured in terms of active users, worldwide reach or user engagement time, Facebook is quite simply off the scale.

Facebook has also become deeply embedded in a bewildering range of websites and online services. Newspaper sites, music subscription services, internet television services, blogs and many other online service categories use Facebook's public APIs to embed Facebook into their own service. With ‘Like' buttons, sharing features and social apps users can enjoy Facebook wherever they are on the web, and they can also enjoy the best of the web while on Facebook.

Facebook has also become an important part of the communications and marketing strategies of millions of businesses, large and small. Businesses use Facebook READ MORE >

EXECUTIVE SUMMARY

INTRODUCTION: SOCIAL NETWORKING
- Definitions
- Social Networking
- Social Media
- Examples: What is Social Media and What Isn't?
- Spotify
- Amazon Instant Video
- Online Newspapers
- Market Structure
- Professionally-generated Content (PGC)
- User-generated Content (UGC)

FACEBOOK: COMPANY PROFILE
- Outline
- User Growth
- Service Features
- Revenues & Profitability
- Acqusitions
- Facebook Market Reach
- Key Competitors

COMPETITOR PROFILES: SOCIAL NETWORKS
- Google+
Outline
Service Features
Business Aspects
Analysis
- Instagram (Acquired by Facebook in April 2012)
Outline
Service Features
Social Media Interaction
Revenue Model
User Growth and Revenues
Key Competitors
Analysis
- LinkedIn
Outline
Service Outline
User Growth
Revenue Model
Social Media Integration
Business Aspects
Key Competitors
- Mixi
Outline
Service Features
User Growth
Revenue Model
Business Aspects
Social Media Integration
Key Competitors
Analysis
- Pinterest
Outline
Service Features
Social Media Interaction
Revenue Model
User Growth and Revenues
Business Aspects
Key Competitors
- QZone
Outline
Service Features
User Growth
Revenue Model
Revenues
Key Competitors
- RenRen
Outline
Service Overview
Revenue Model
Business Aspects
User Growth
Social Media Integration
Key Competitors
Analysis
- Tumblr
Outline
Service Features
Social Media Integration
Revenue Model
User Growth and Revenues
Business Aspects
Key Competitors
Analysis
- Twitter
Outline
Service Features
User Growth and Revenues
Key Competitors
- YouTube
Outline
Service Features
User Growth
Revenue Model
Business Aspects
Social Media Integration
Key Competitors
Analysis
- Zynga
Outline
Revenues and Growth
Revenue Model
Business Aspects
Social Media Integration
Key Competitors

FACEBOOK AROUND THE WORLD
- North America
- United States
- Canada
- Western Europe
- Germany
- France
- United Kingdom
- Italy
- Spain
- Central, Southern and Eastern Europe
- Russia
- Poland
- Greece
- Czech Republic
- Asia Pacific
- China
- Japan
- India
- Australia
- South Korea
- Indonesia
- Latin America
- Brazil
- Mexico
- Argentina
- Venezuela
- Middle East and Africa
- Turkey
- Saudi Arabia
- South Africa

MARKET ANALYSIS: SOCIAL MEDIA
- Sector Volatility
- Market Structure: Value Chain
- Content
- Cost of Creating Content for Social Networking Sites
- Content Ownership
- Equity Implications
- User Growth
- Revenue Models
- Advertising
- Paid-for Revenue Models
- Average Revenue per User (ARPU)
- Social Media
- Comparison with Traditional Media: Newspapers and Books
- Analysis
- Total Addressable Market: Social Media
- Share Price for Public Social Media Companies
- Privacy and Regulatory Aspects
- Social Graph
- Multi-platform
- Google+ vs. Facebook
- Path to Value Creation: Social Media Companies
- Advertising
- User Payment
- Success Formula

FACEBOOK: VALUATION & ANALYSIS
- Method 1: Simple P/E
- Method 2: IPO P/E: Google vs. Facebook
- Method 3: Projected Future Earnings
- Addressable Market: Social Networking Industry
- Base Case: Core Social Networking Business
- Growth Scenarios: Facebook (A) and Facebook (B)
- Facebook (A)
- Facebook (B)
- Method 4: Revenue Growth Benchmarking with Apple & Google
- Summary

CONCLUSION
- Facebook's Business Model
- Advertising
- Premium Revenue Streams
- Key Risks
- Recommendations

MARKET FORECASTS
- Internet Users
- Social Networking Users
- Percentage of Internet Users that are Social Networking
- Social Networking Revenues: Addressable Market
- Facebook Users by Region
- Facebook Users vs. All Internet Users
- Facebook Users vs. All Social Networking Users
- Facebook Revenues
- Facebook Market Share

APPENDIX
- Regional Segmentation: Constituent Countries
- Research Methodology
- About the Authors
- Andrew Sheehy
- Sara Foster
- Dr Dave Taylor

LIST OF FIGURES

Figure 1: Illustration of Structure of Social Media - Newspaper Content
Figure 2: Illustration of Structure of Social Media - User-generated Content (UGC)
Figure 3: Facebook News Feed page
Figure 4: Facebook Social Sharing Features
Figure 5: Google+ Features
Figure 6: Google+ Stream interface showing the top 4 icons: Home, Photos, Profile, Circles
Figure 7: Google + Integration with You Tube - Example of broadcasting YouTube videos and starting multi-person video conferences
Figure 8: Google+ iPhone App Shows the Homepage Menu Options and the Huddle function
Figure 9: Instagram filter selection and popular images page
Figure 10: Instagram followers/following and news features
Figure 11: LinkedIn Profile
Figure 12: LinkedIn Mobile App
Figure 13: LinkedIn Subscription Levels
Figure 14: LinkedIn / Twitter Integration
Figure 15: Mixi Log In Page
Figure 16: Example of Mixi Profile Page
Figure 17: Pinterest Homepage
Figure 18: Pinterest User Pinboards
Figure 19: Renren Home Page
Figure 20: Examples of Renren Games
Figure 21: Renren VIP Membership Options
Figure 22: Tumblr Dashboard Page
Figure 23: Tumblr for iPhone and BlackBerry
Figure 25: YouTube "Share" Options
Figure 26: YouTube for Connected TV
Figure 27: Farmville Game
Figure 28: Cityville Game
Figure 29: Value Chain for Traditional Media Company
Figure 30: Value Chain for Social Media Company
Figure 31: Facebook Users compared with Worldwide Social Networking Users (Worldwide) from 2009 to 2016 (Millions)
Figure 32: Worldwide Online Advertising Market from 2012 to 2016 (USD, Billions)
Figure 33: Facebook Users compared with Worldwide Internet Users (Worldwide) from 2009 to 2016 (Millions)
Figure 34: Facebook Revenue Projection Scenarios: Facebook (A) and Facebook (B) for 2012 to 2016 (USD, Billions)
Figure 35: Facebook Revenue Growth Scenarios
Figure 36: Facebook Revenue Growth (Like-for-like Benchmarking with Apple and Google) from 2008 to 2016 (USD, Billions)
Figure 37: Worldwide Online Advertising Market from 2012 to 2016 (USD, Billions)
Figure 38: Worldwide Internet Users (North America; Western Europe; Central, Southern & Eastern Europe; Asia Pacific; Latin America & Caribbean; Middle East & Africa) from 2012 to 2016 (Millions)
Figure 39: Worldwide Social Networking Users (North America; Western Europe; Central, Southern & Eastern Europe; Asia Pacific; Latin America & Caribbean; Middle East & Africa) from 2012 to 2016 (Millions)
Figure 40: Worldwide Social Media Users (North America; Western Europe; Central, Southern & Eastern Europe; Asia Pacific; Latin America & Caribbean; Middle East & Africa) from 2012 to 2016 (Millions)
Figure 41: Facebook Users (North America; Western Europe; Central, Southern & Eastern Europe; Asia Pacific; Latin America & Caribbean; Middle East & Africa) from 2012 to 2016 (Millions)
Figure 42: Facebook Users compared with Worldwide Internet Users (Worldwide) from 2009 to 2016 (Millions)
Figure 43: Facebook Users compared with Worldwide Social Networking Users (Worldwide) from 2009 to 2016 (Millions)
Figure 44: Facebook Revenues - Growth Options from 2012 to 2016 (USD, Billions)

LIST OF TABLES

Table 1: Summary of Core Social Networking Features
Table 2: Defining Social Media
Table 3: Facebook User Growth
Table 4: Facebook: Rate of Growth in Users from 2010 to 2016 (Millions and Percent)
Table 5: Facebook Users (North America; Western Europe; Central, Southern & Eastern Europe; Asia Pacific; Latin America & Caribbean; Middle East & Africa) from 2012 to 2016 (Millions)
Table 6: Facebook Revenue and Net Income from 2009 to 2011
Table 7: Facebook Acquisitions
Table 8: Google's Recent Acquisitions in social media space (Summary)
Table 9: Instagram Users
Table 10: LinkedIn Users
Table 11: Mixi Smartphone Users
Table 12: Pinterest Users
Table 13: Examples of Main Competitors to QZone
Table 14: Renren Revenues
Table 15: Renren User Numbers
Table 16: Leading Social Networking Sites in China
Table 18: Tumblr User Growth
Table 19: Twitter Acquisitions
Table 20: YouTube Page Views
Table 21: Zynga Acquisitions
Table 22: Zynga - Key Game Titles
Table 27: Leading Social Networking Sites in the US
Table 28: Facebook - Major Indicators in 2011 (United States)
Table 29: Leading Social Networking Sites in Canada
Table 30: Facebook - Major Indicators in 2011 (Canada)
Table 31: Top Social Networking Sites - Germany
Table 32: Facebook - Major Indicators in 2011 (Germany)
Table 33: Top Social Networking Sites - France
Table 34: Facebook - Major Indicators in 2011 (France)
Table 35: Top Social Networking Sites - United Kingdom
Table 36: Facebook - Major Indicators in 2011 (United Kingdom)
Table 37: Top Social Networking Sites - Italy
Table 38: Facebook - Major Indicators in 2011 (Italy)
Table 39: Top Social Networking Sites - Spain
Table 40: Facebook - Major Indicators in 2011 (Spain)
Table 41: Top Social Networking Sites - Russia
Table 42: Facebook - Major Indicators in 2011 (Russia)
Table 43: Top Social Networking Sites - Poland
Table 44: Facebook - Major Indicators in 2011 (Poland)
Table 45: Top Social Networking Sites - Greece
Table 46: Facebook - Major Indicators in 2011 (Greece)
Table 47: Top Social Networking Sites - Czech Republic
Table 48: Facebook - Major Indicators in 2011 (Czech Republic)
Table 49: Top Social Networking Sites - China
Table 50: Facebook - Major Indicators in 2011 (China)
Table 51: Top Social Networking Sites - Japan
Table 52: Facebook - Major Indicators in 2011 (Japan)
Table 53: Top Social Networking Sites - India
Table 54: Facebook - Major Indicators in 2011 (India)
Table 55: Top Social Networking Sites - Australia
Table 56: Facebook - Major Indicators in 2011 (Australia)
Table 57: Top Social Networking Sites - South Korea
Table 58: Facebook - Major Indicators in 2011 (South Korea)
Table 59: Top Social Networking Sites - Indonesia
Table 60: Social news sites - Tunden.com and Lintas.me
Table 61: Facebook - Major Indicators in 2011 (Indonesia)
Table 62: Top Social Networking Sites - Brasil
Table 63: Facebook - Major Indicators in 2011 (Brazil)
Table 64: Top Social Networking Sites - Mexico
Table 65: Facebook - Major Indicators in 2011 (Mexico)
Table 66: Top Social Networking Sites - Argentina
Table 67: Facebook - Major Indicators in 2011 (Argentina)
Table 68: Top Social Networking Sites - Venezuela
Table 69: Facebook - Major Indicators in 2011 (Venezuela)
Table 70: Top Social Networking Sites - Turkey
Table 71: Facebook - Major Indicators in 2011 (Turkey)
Table 72: Top Social Networking Sites - Saudi Arabia
Table 73: Facebook - Major Indicators in 2011 (Saudi Arabia)
Table 74: Top Social Networking Sites - South Africa
Table 75: Facebook - Major Indicators in 2011 (South Africa)
Table 76: Examples of Volatility in the Social Media Market
Table 77: Summary of the Main Differences between a Traditional Media Company and a Social Media Company
Table 78: Economic Value of Content Creation: Facebook (USD, Billions)
Table 79: Value Equation - Social Media Service and Users
Table 80: User Growth Trends - Leading Social Networking Sites (Millions)
Table 81: Summary of Revenue Models used on Social Media Sites
Table 82: Average Revenue per User for 12 Social Networking Sites
Table 83: Average Revenue per User per Month - Social Media (Facebook & Zynga) vs. Traditional Media (Newspapers & Books)
Table 84: Excluded Readership Scenarios for books and Newspapers
Table 85: Comparative Sizes of Industries: Social Media (Addressable), Newspapers, Books, Television Advertising, Pay TV and Fixed Broadband
Table 86: Worldwide Revenue Potential - Social Media
Table 87: Share Prices of Selected Social Media Companies for the first 9months after IPO
Table 88: Relative Change Share Prices of Selected Social Media Companies for the first 9months after IPO
Table 89: Major Internet service categories to have emerged over the last 10 years and category leaders
Table 90: Facebook Valuation: Method 1 (Simple P/E Ratio)
Table 91: Facebook 20-year Valuation ‘Aggressive' and ‘More Realistic' Growth Scenarios
Table 92: Facebook Valuation: Method 2 (Post IPO P/E: Google and Facebook)
Table 93: Comparative 20-year Valuations - Apple, Google and Microsoft
Table 94: Apple Revenues from 2001 to 2011 separated into ‘Legacy Macintosh Business' and ‘Digital Media Business' (USD, Billions)
Table 95: Google Revenues from 2001 to 2011 (USD, Billions)
Table 96: Comparative Rates of Revenue Growth for Apple, Google and Microsoft (USD, Billions)
Table 97: Summary of Findings - Facebook Valuation Methodologies
Table 98: Summary of Major Risks Affecting Facebook and Mitigating Strategies
Table 99: Worldwide Internet Users (North America; Western Europe; Central, Southern & Eastern Europe; Asia Pacific; Latin America & Caribbean; Middle East & Africa) from 2012 to 2016 (Millions)
Table 100: Worldwide Social Networking Users (North America; Western Europe; Central, Southern & Eastern Europe; Asia Pacific; Latin America & Caribbean; Middle East & Africa) from 2012 to 2016 (Millions)
Table 101: Worldwide Social Media Users (North America; Western Europe; Central, Southern & Eastern Europe; Asia Pacific; Latin America & Caribbean; Middle East & Africa) from 2012 to 2016 (Millions)
Table 102: Worldwide Social Media Revenues (North America; Western Europe; Central, Southern & Eastern Europe; Asia Pacific; Latin America & Caribbean; Middle East & Africa) from 2012 to 2016 (USD, Millions)
Table 103: Facebook Users (North America; Western Europe; Central, Southern & Eastern Europe; Asia Pacific; Latin America & Caribbean; Middle East & Africa) from 2012 to 2016 (Millions)
Table 104: Facebook Users compared with Worldwide Internet Users (Worldwide) from 2009 to 2016 (Millions)
Table 105: Facebook Users compared with Worldwide Social Networking Users (Worldwide) from 2009 to 2016 (Millions)
Table 106: Facebook Revenues - Growth Options from 2012 to 2016 (USD, Billions)
Table 107: Facebook Market Share [Social Networking Users and Revenues (Base Case Scenario)] from 2012 to 2016 (Percent)
Table 108: Constituent Regions (Generator Research Forecasts)
Table 109: Constituent Countries (Generator Research Forecasts)

This 224-page PDF report contains a wealth of data, market information and insight, covering all the important bases, including:

- Detailed valuation analysis of Facebook: If Facebook is to justify its $100 billion valuation then the company will need to generate revenues approaching $39 billion in 2016, up from just 3.7 billion in 2011 - while maintaining proportionate net income.

- We have used 4 different valuation methods and a fundamental approach to model Facebook's future revenues and net income under several scenarios and we have benchmarked the results with what was achieved by Microsoft, Apple and Google. This section will shed new light on how fast Facebook will need to increase revenues in future years and will allow you to more clearly understand the company's true value;

- Powerful insight into what Facebook needs to do to justify a $100bn valuation: One aspect of the conclusion of this report is that Facebook must execute one bold strategy in order to justify a $100 billion valuation. If the company fails to do this then Facebook's current business model will quickly run out of stream leading to a slowdown in revenue growth, reduced profits and a sharp fall in the company's stock price. In a remarkable, insight-packed section, this report clearly explains what this bold strategy is...

- Detailed analysis of wider social networking market: This report offers a wealth of data, analysis and insight on the most important features of the social networking landscape: user growth trends, revenue models, average revenue per user (ARPU), comparison between social media companies and traditional media companies, total addressable market for social networking, commercial value of the social graph, privacy and regulatory aspects, content ownership and much more;

- 5-year market forecasts: Apart from extensive analysis, charts, tables and data distributed throughout the report, you will also find essential 5-year, region-by-region market forecasts for the major indicators: Internet users, social networking users, overall social networking market size, total addressable market, Facebook user growth, Facebook revenues and Facebook market share;

- Competitor Profiles: Read detailed profiles of other major players in the social networking market: Google+, linkedIn, Mixi (Japan), Pinterest, QZone (China), RenRen (China), Tumblr, Twitter, YouTube, and Zynga;

- International analysis - Facebook around the globe: Review 24 detailed country profiles and analysis to understand Facebook's market position and growth prospects in the largest 24 economies around the globe, including United States, India, Russia, China, Japan, France, Germany, United Kingdom, Australia, Indonesia, South Korea, South Africa and more.

- Google+
- Instagram (Acquired by Facebook in April 2012)
- LinkedIn
- Mixi
- Pinterest
- QZone
- RenRen
- Tumblr
- Twitter
- YouTube
- Zynga

Note: Product cover images may vary from those shown

RELATED PRODUCTS

Our Clients

Our clients' logos