So Facebook filed their S-1 yesterday. If you somehow missed it (are you living under a rock made of dial-up modems?), Facebook officially filed for its IPO on February 1st, and the numbers in that filing are honestly kind of hard to wrap your head around. Theyre looking at valuations north of $100 billion, which is just an absurd number to type out for a company that started in a Harvard dorm room. 900 million users, or somewhere close to it. Revenue north of $3.7 billion last year. I read through chunks of the filing on my lunch break yesterday (yes, I am that person, sorry not sorry) and the thing that actually stuck with me wasnt the valuation number, it was how much of their revenue is still just banner ads and sponsored stories. For a company everyone talks about like its reinvented the internet, an awful lot of the business model is still 2005-era web advertising with better targeting.
Zuckerberg's letter at the front of the filing is worth reading if you havent. Its got that "we're not just a company, we're on a mission" tone that founders love to write once they know a few million people are going to actually read their words for the first time. Some of it is genuine I think. Some of it reads like it was workshopped by six different lawyers and a PR firm until every sentence was safe enough to survive a decade of scrutiny. Probably both things are true at once.
I'll be honest, my first reaction wasnt excitement, it was mild dread. Not because I think Facebook is doomed or anything dramatic like that. Its more that IPO filings like this always kick off eighteen months of every tech blog, every cable news segment, and half of Twitter treating "is Facebook worth it" as the only story in tech that matters. We just went through this exact cycle with LinkedIn last year and Groupon before that, and honestly the Groupon stock chart since November has been sort of a cautionary tale nobody in the Facebook hype machine seems to want to bring up out loud.
Anyway. Two weeks ago half the internet went dark over SOPA and PIPA, Wikipedia included, and it actually worked, the bills got shelved. That was a genuinely wild week to be paying attention to tech and policy stuff at the same time, and I still think its a bigger long-term story than this IPO filing even though it's getting a fraction of the coverage today. Funny how fast the news cycle moves on. Three weeks ago it was "the internet defeats congress," this week its "how many billions is a picture-sharing site worth."
There's also been some noise the last couple days about Windows Phone 8, apparently some internal Microsoft video with details on the next version (codename Apollo, dual-core support, new screen resolutions) got out into the wild. I havent seen the actual footage myself, just secondhand writeups, so take that with a grain of salt until Microsoft says something official. Still, if true its a decent signal that Microsoft knows the current Windows Phone lineup needs a real hardware story to compete, not just Nokia goodwill and a nice tile interface.
What I keep coming back to with the Facebook thing is a pretty boring, practical question that nobody wants to write 2000 words about: what happens to the product once its a public company answering to shareholders every quarter. Right now Facebook can ship weird experimental stuff, Timeline being the most recent example, and eat the backlash because they dont owe anyone a growth number every ninety days. Once youre public that changes. Doesnt mean it gets worse necessarily. Google went public in 2004 and mostly kept shipping interesting things for years after. But it's a real shift in incentives and I dont think "line goes up forever" is a law of nature, no matter what a filing full of big numbers wants you to believe.
Also, completely unrelated, but does anyone else think the "S-1" naming convention SEC filings use is needlessly cryptic. Like, just call it what it is. Not a huge complaint. Just a Thursday morning complaint.
We'll see how the roadshow goes. My guess is this thing prices sometime in April or May and every tech writer I know is already mentally drafting their "what Facebook's IPO means" piece. I'll probably write one too, let's be real.