Peter Kafka

Recent Posts by Peter Kafka

Reminder! Facebook Is Really, Really Big.

A reminder: When Facebook executives aren’t busy fending off privacy queries, they’re running a business. A really big one.

Guesstimating the total size of that business makes for good Web sport, and Reuters makes a run at it today: The news service pegs Facebook’s 2009 revenue at “$700 million to $800 million” and reports a “solid net profit, in the tens of millions of dollars,” citing two anonymous sources.

Those numbers are higher than other ones we’ve seen, but they don’t sound unbelievable. Facebook now boasts enormous size–half a billion users!–and at least three different revenue streams: Traditional display ads sold by a top-flight sales team, self-serve ads (check out this do-it-yourself tweak) and virtual goods (read: Zynga).

What Facebook doesn’t have, as best as I can tell: A magic moneymaking bullet a la Google’s (GOOG) AdWords. That may prevent the company from getting a Google-like market cap when and if it goes public. But I don’t think Mark Zuckerberg and company are complaining.

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Just as the atom bomb was the weapon that was supposed to render war obsolete, the Internet seems like capitalism’s ultimate feat of self-destructive genius, an economic doomsday device rendering it impossible for anyone to ever make a profit off anything again. It’s especially hopeless for those whose work is easily digitized and accessed free of charge.

— Author Tim Kreider on not getting paid for one’s work