Spekulatius Posted October 31, 2018 Share Posted October 31, 2018 Traditional media has ads and charges subscription fees. Link to comment Share on other sites More sharing options...
JayGatsby Posted October 31, 2018 Share Posted October 31, 2018 Traditional media has ads and charges subscription fees. If traditional is online news like washingtonpost.com, they only charge because they couldn't monetize it otherwise. All the news sites tried to rely on ads only but couldn't make it profitable. Their targeting was crappy, and ad placement either i) destroyed the user experience, ii) could be easily ignored, or iii) could be easily filtered with an ad blocker. Facebook doesn't have those problems. Traditional print where you charged both subscription and advertising was indeed an amazing business model while it lasted. Link to comment Share on other sites More sharing options...
Liberty Posted October 31, 2018 Share Posted October 31, 2018 Traditional media relied on local distribution monopolies to make money. Facebook relies on the network effect (people go on the site because other people are on the site), so it's a lot more important to keep barriers to entry low (no fees). Link to comment Share on other sites More sharing options...
Spekulatius Posted October 31, 2018 Share Posted October 31, 2018 Traditional media has ads and charges subscription fees. If traditional is online news like washingtonpost.com, they only charge because they couldn't monetize it otherwise. All the news sites tried to rely on ads only but couldn't make it profitable. Their targeting was crappy, and ad placement either i) destroyed the user experience, ii) could be easily ignored, or iii) could be easily filtered with an ad blocker. Facebook doesn't have those problems. Traditional print where you charged both subscription and advertising was indeed an amazing business model while it lasted. You still need to pay for TV and watch ads in most channels. Yes, you can get over the air TV for free but few people do that. Link to comment Share on other sites More sharing options...
valueinvestor Posted October 31, 2018 Share Posted October 31, 2018 “The best minds of my generation are thinking about how to make people click ads; that sucks” - Jeff Hammerbacher 17 words that will be etched in fame in due course. Two words "Opt in" if when regulated in will be giant sucking sound for the online ad scene. I'm not sure you can opt-in to ads when the service is free? I suppose you could opt to pay a subscription fee in lieu? Sure, let's see how FB fares in a subscription fee realm. Different ball game, good old competition will rule then. Everyone I know came in because it is free, they will leave when it no longer is. "Free" is the perception that is now worth a couple of trillion of market cap. Those are deep pockets, now the daggers are coming out from all sides: Traditional media, old telecom, socialist nation/states, consumer advocacy. I think what walkie is saying is that you can either recieve ads or pay a subscription fee. At that point most people would opt-in to receive ads in lieu of paying a subscription. That is as seen from FB's perspective. Some of the regulatory intent floating around starts with allowing consumers the choice of opting in even if the service is "free". That's because the world is now caught up with the monetization scheme and is staring at the deep pockets behind the 2 Trillion. Plus there are lots of well heeled losers of this, Murdoch for instance and someone as dear to COBF as Malone. To me, the real revelation will be the blowing of the urban myth surrounding the efficacy of the online ad spending. Not sure what is meant by this, but I find online ad spending provides huge ROI for certain businesses, especially ones being run online. Kylie Jenner, for example, who recently appeared on Forbes. My business had grown incredibly when we started to use Google and Facebook marketing! The cost of running an ad is incredibly low, even on a relative basis, while incredibly under-utilized. In the age of entrepreneurship, I think there's an incredible runway for Instagram, WhatsApp, and Facebook. Link to comment Share on other sites More sharing options...
walkie518 Posted November 6, 2018 Share Posted November 6, 2018 115 accounts...really? this seems like a pr stunt rather than an effort to combat the problem Link to comment Share on other sites More sharing options...
valueinvestor Posted November 7, 2018 Share Posted November 7, 2018 115 accounts...really? this seems like a pr stunt rather than an effort to combat the problem Huh? Was that directed at my post? or was there a separate issue with 115 accounts? Link to comment Share on other sites More sharing options...
walkie518 Posted November 7, 2018 Share Posted November 7, 2018 115 accounts...really? this seems like a pr stunt rather than an effort to combat the problem Huh? Was that directed at my post? or was there a separate issue with 115 accounts? no, sorry the 115 was about the number of accounts that were targeted as possible interference during the mid-terms I don't see how there would only be 115 accounts...this doesn't make sense when there could be hundreds of thousands if one were to put money behind an effort to tamper with elections and automate Link to comment Share on other sites More sharing options...
Guest Schwab711 Posted November 7, 2018 Share Posted November 7, 2018 The 115 come from a specific tip. It's probably related to the ongoing IRA/Prigozhin case. Link to comment Share on other sites More sharing options...
Gregmal Posted November 9, 2018 Share Posted November 9, 2018 So I've held off commenting here(outside of one comment) but this is an easy short IMO. The business is one dimensional and the greatest resource this company has(data) is becoming less and less useful to it. As I said at $170 after the Q2 earnings, this is challenged. Sentiment has shifted, no one is buying them out, they have nothing to spin off(WhatsApp and IG are just different versions of what FB already is), public and or private comps are not favorable, and the nail in the coffin IMO is that with the split now in government, regulating and choking off social media will become a bipartisan effort and FB is the whipping boy. They'll have huge headwinds over the next two years and at the least have to waste tons of time and resources making it look like they're reforming. Sentiment has clearly shifted and this is not a diversified business. I see tons of solid businesses trading at significantly lower multiples, so I see zero reason why FB can't continue to grow the bottom line will still treading in mud or even heading lower. And FWIW SNAP/TWTR are literally worth the equivalent of what FB's daily trading fluctuations are...I think IG is a premium business, right now(who knows what the future holds, just like MySpace in 2005) so getting anywhere near $400B on a SOTP is a major stretch for me... Link to comment Share on other sites More sharing options...
DanielGMask Posted November 9, 2018 Share Posted November 9, 2018 So I've held off commenting here(outside of one comment) but this is an easy short IMO. The business is one dimensional and the greatest resource this company has(data) is becoming less and less useful to it. As I said at $170 after the Q2 earnings, this is challenged. Sentiment has shifted, no one is buying them out, they have nothing to spin off(WhatsApp and IG are just different versions of what FB already is), public and or private comps are not favorable, and the nail in the coffin IMO is that with the split now in government, regulating and choking off social media will become a bipartisan effort and FB is the whipping boy. They'll have huge headwinds over the next two years and at the least have to waste tons of time and resources making it look like they're reforming. Sentiment has clearly shifted and this is not a diversified business. I see tons of solid businesses trading at significantly lower multiples, so I see zero reason why FB can't continue to grow the bottom line will still treading in mud or even heading lower. And FWIW SNAP/TWTR are literally worth the equivalent of what FB's daily trading fluctuations are...I think IG is a premium business, right now(who knows what the future holds, just like MySpace in 2005) so getting anywhere near $400B on a SOTP is a major stretch for me... I haven’t commented either but I’m buying. For me is a long and I’m putting my money where my words are. Link to comment Share on other sites More sharing options...
matts Posted November 9, 2018 Share Posted November 9, 2018 So I've held off commenting here(outside of one comment) but this is an easy short IMO. The business is one dimensional and the greatest resource this company has(data) is becoming less and less useful to it. As I said at $170 after the Q2 earnings, this is challenged. Sentiment has shifted, no one is buying them out, they have nothing to spin off(WhatsApp and IG are just different versions of what FB already is), public and or private comps are not favorable, and the nail in the coffin IMO is that with the split now in government, regulating and choking off social media will become a bipartisan effort and FB is the whipping boy. They'll have huge headwinds over the next two years and at the least have to waste tons of time and resources making it look like they're reforming. Sentiment has clearly shifted and this is not a diversified business. I see tons of solid businesses trading at significantly lower multiples, so I see zero reason why FB can't continue to grow the bottom line will still treading in mud or even heading lower. And FWIW SNAP/TWTR are literally worth the equivalent of what FB's daily trading fluctuations are...I think IG is a premium business, right now(who knows what the future holds, just like MySpace in 2005) so getting anywhere near $400B on a SOTP is a major stretch for me... So the ONLY thing you have held your tongue on inside this investment forum is an investment in which you have a high conviction opinion? ??? I kid, I kid, don't start a thing... Link to comment Share on other sites More sharing options...
Gregmal Posted November 9, 2018 Share Posted November 9, 2018 I am an expert and a genius when it comes to politics and certain investment ideas. I am far from one when it comes to social media/tech stocks and short selling. So the bar for me must be higher! Link to comment Share on other sites More sharing options...
SHDL Posted November 9, 2018 Share Posted November 9, 2018 I actually own some long dated FB puts, although I regard that mainly as a hedge for my GOOGL position as opposed to a straight bet on Facebook’s demise. Link to comment Share on other sites More sharing options...
walkie518 Posted November 19, 2018 Share Posted November 19, 2018 1.6B is far more appropriate what's interesting is that these were blocked accounts prior to creation...what about the accounts that weren't blocked prior to these new tests on record creation? Link to comment Share on other sites More sharing options...
HalfMeasure Posted November 19, 2018 Share Posted November 19, 2018 Anyone who has been following the stock for a while willing to share how you're thinking about fair/intrinsic value today? Link to comment Share on other sites More sharing options...
Mungerish Posted November 19, 2018 Share Posted November 19, 2018 So this whole recent dust up is fascinating to me. Would they in retrospect advocate to remove Alexander Graham Bell from the phone company when so many people have used the telephone to commit crime or terrorism? Similarly, did we prosecute the airlines that were hijacked and used in the 9/11 attacks? Obviously, facebook is not responsible for the creation of the content posted on its platform… yet they are spending billions in security and curation of the content out of shareholder self interest (which of course is rational for shareholders and does benefit users). The NYT who wrote the most recent expose` and Boston Globe for another example have obvious political biases and have had numerous journalists terminated for plagiarism and making up bogus sources for stories over the years. The Globe leaked my bank account info years ago by wrapping bundles of newspapers with subscribers’ bank account info. Those are very real issues compared to whether I "liked" some fishing gear or someone’s product. Conversely, no one has to put there birthday or any substantive personal info on facebook to have an account. My point is that this whole thing smacks of envy from traditional media for: A) the profitability of facebooks platforms, B). blaming some other organization for the 2016 election results and C). maybe a little retribution for not being more left of center in how they treat some conservative news/sites/postings. I’ve gone back and read or listened to everything Buffett and Munger ever said about tv and newspapers on the cnbc Buffett archive and facebook seems to have a much stronger hand than any of the companies they were speaking of at the time ( WAPO, ABC/Capcities, etc). To use Buffetts metaphor for the price of WAPO when he bought it: This may be one of those moments when people should be willing to swim miles out in to the shark infested Atlantic Ocean for the opportunity to buy FB at this price. Link to comment Share on other sites More sharing options...
mcliu Posted November 19, 2018 Share Posted November 19, 2018 Can they really regulate the social media / internet? ??? If this type of business is one that relies on network effects (a bigger network provides more value to each users) hasn't FB already won? Effectively everyone who's on the internet and can use Facebook (ex. China) is on one of its platforms. It'll hard to see how a competitor can build a bigger network. Isn't that a moat? So the situation isn't quite like MySpace/Friendster where they just weren't big enough to have reached this critical mass. Link to comment Share on other sites More sharing options...
johnny Posted November 19, 2018 Share Posted November 19, 2018 Buffett was buying WAPO at like 6 times earnings, FB is at 20. I don't think these are remotely comparable. You'd making a much longer-run prediction about a business that is giving you much less data to actually model the future off of. Link to comment Share on other sites More sharing options...
DanielGMask Posted November 19, 2018 Share Posted November 19, 2018 Anyone who has been following the stock for a while willing to share how you're thinking about fair/intrinsic value today? Above current share price. Link to comment Share on other sites More sharing options...
DanielGMask Posted November 19, 2018 Share Posted November 19, 2018 Can they really regulate the social media / internet? ??? If this type of business is one that relies on network effects (a bigger network provides more value to each users) hasn't FB already won? Effectively everyone who's on the internet and can use Facebook (ex. China) is on one of its platforms. It'll hard to see how a competitor can build a bigger network. Isn't that a moat? So the situation isn't quite like MySpace/Friendster where they just weren't big enough to have reached this critical mass. FB may even be a web browser/search engine killer if the ecosystem within the platform is big enough and has a better search engine. I consider this company one with a very strong and misunderstood moat. Time will tell! Link to comment Share on other sites More sharing options...
DanielGMask Posted November 19, 2018 Share Posted November 19, 2018 Buffett was buying WAPO at like 6 times earnings, FB is at 20. I don't think these are remotely comparable. You'd making a much longer-run prediction about a business that is giving you much less data to actually model the future off of. PE is certainly different but also the growing possibilities. I don’t see FB being at that earnings multiple anytime soon. Link to comment Share on other sites More sharing options...
Mungerish Posted November 20, 2018 Share Posted November 20, 2018 Buffett was buying WAPO at like 6 times earnings, FB is at 20. I don't think these are remotely comparable. You'd making a much longer-run prediction about a business that is giving you much less data to actually model the future off of. I agree that the multiples are very different to WAPO....However so is the reach and scale of FB compared to WAPO. I happen to believe we are still in the early innings of monetizing the multiple platforms with billions of users. You are getting a great GARP investment here versus a deep value play. It's classic Buffett versus Munger's evolution to great businesses compounding at high rates and returns on capital Link to comment Share on other sites More sharing options...
Liberty Posted November 20, 2018 Share Posted November 20, 2018 What were interest rates when Buffett bought WaPo shares? Link to comment Share on other sites More sharing options...
Mungerish Posted November 20, 2018 Share Posted November 20, 2018 Speaking of WAPO and FB https://www.cnbc.com/video/2018/11/20/former-facebook-director-on-companys-performance.html Link to comment Share on other sites More sharing options...
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