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Facebook Blows $16 Billion On SnapChat Competitor WhatsApp; Stock Tanks

Tyler Durden's picture


America Online President and Chief Operating Officer Bob Pittman said: "Acquiring ICQ fits perfectly into our multiple-brand strategy. Like CompuServe, ICQ substantially broadens our reach in important markets not served by AOL-branded products. In addition to its international reach, ICQ has tremendous appeal among young, technically sophisticated Web users and there is remarkably little overlap with AOL."

        -  June 8, 1998, when AOL announced it paid $287 million (and another $120 million contingent) to acquire ICQ's 12 million users.

After being rebuffed by SnapChat last year to the tune of $3 billion, Facebook decided that growth at any price was all that matters by blowing more than 5 times as much on the purchase of privately-owned WhatsApp. For $16 billion ($4bn cash and $12bn stock), Facebook gets 320 million active WhatsApp users at a whopping $50 per user. Why whopping? Because a few days ago Rakuten bought Viber's 300 million users for $900 million, or about $3 a pop, and about ten times less than what Facebook just paid. Not surprisingly FB shareholders are not happy. The company, which allows users to send messages over the web for free (as opposed to traditional text messages which most Telcos are now offering for free also) "is on a path to connect 1 billion people," Zuckerberg said, adding that they are "adding 1 million people per day..." It seems, as we noted previously, that the real bubble is in private markets not public.

For those asking, Whatspp, a company most have never heard off, now has a greater enterprise value than:

  • Motorola Solutions;
  • Starwood Hotels;
  • Alliance Data;
  • Ameren;
  • Intuitive Surgical;
  • Beam;
  • Kohls'
  • Coca-Cola Enterprises
  • Wisconsin Energy;
  • Broadcom;
  • Ross Stores;
  • Southwest Airlines;
  • Tyson Foods

And so on.


The WhatsApp response:

Almost five years ago we started WhatsApp with a simple mission: building a cool product used globally by everybody. Nothing else mattered to us.


Today we are announcing a partnership with Facebook that will allow us to continue on that simple mission. Doing this will give WhatsApp the flexibility to grow and expand, while giving me, Brian, and the rest of our team more time to focus on building a communications service that’s as fast, affordable and personal as possible.


Here’s what will change for you, our users: nothing.


WhatsApp will remain autonomous and operate independently. You can continue to enjoy the service for a nominal fee. You can continue to use WhatsApp no matter where in the world you are, or what smartphone you’re using. And you can still count on absolutely no ads interrupting your communication. There would have been no partnership between our two companies if we had to compromise on the core principles that will always define our company, our vision and our product.


On a personal note, Brian and I couldn’t be more proud to be part of a small team of people who, in just under five years, built a communication service that now supports over 450 million monthly active users worldwide and over 320 million daily active users. They have helped re-define and revolutionize communication for the 21st century, and we couldn’t be more grateful.


Our team has always believed that neither cost and distance should ever prevent people from connecting with their friends and loved ones, and won’t rest until everyone, everywhere is empowered with that opportunity. We want to thank all of our users and everybody in our lives for making this next chapter possible, and for joining us as we continue on this very special journey.

Based on the valuations below, it is no wonder shareholders are selling...


As we noted previously, the real dot-com bubble is just outside the public view...

While the world of speculative capital is focused intently on the Twitter and Facebook #Ref/0 fundamental valuations in the publicly-traded equity markets, as the WSJ illustrates, the real dot-com 2.0 bubble is occurring in the private markets. Today there are more than 30 companies in the US, Europe, and China that are valued at $1 billion or more by venture-captal firms and the club is becoming less exclusive as venture capitalists (in their ever growing speculative fervor) funnel large sums of capital into start-ups.


Click image for interactive and sortable WSJ infographic



In summary:

A few days ago Rakuten bought Viber for $900 million. Viber has 300 million users... $3 per user

And today Facebook bought WhatsApp for $16bn; WhatsApp has 320 million active users... $50 per user!


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Wed, 02/19/2014 - 18:35 | 4454598 RacerX
RacerX's picture

The irony is that there is a direct quote from none other than Tyler Durden himself on the Whatsapp home page (


Why we don't sell ads


Advertising has us chasing cars and clothes, working jobs we hate so we can buy shit we dont need. - Tyler Durden, Fight Club

Wed, 02/19/2014 - 18:39 | 4454612 TruthInSunshine
TruthInSunshine's picture

Facebook has turned into "Grandparents Connection" as all the kewl kids abandon it at light speed.

Facebook should buy Yahoo, Zynga, Groupon, The New York Times & Radio Shack to really maximize its rate of decline and irrelevance.

Wed, 02/19/2014 - 18:39 | 4454624 Theta_Burn
Theta_Burn's picture


Wed, 02/19/2014 - 18:49 | 4454662 smithcreek
smithcreek's picture

I don't live under a rock, but honest to god, I've never heard of WhatsApp.  320 million people have been keeping me out of the loop?


Wed, 02/19/2014 - 18:52 | 4454671 fonzannoon
fonzannoon's picture

FB is now barely down AH. Amazing.

Wed, 02/19/2014 - 18:56 | 4454687 Xibalba
Xibalba's picture


Wed, 02/19/2014 - 18:58 | 4454695 camaro68ss
camaro68ss's picture

I need to come up with a stupid ass app, self value it at 15 billion, then sell it. its that easy

Wed, 02/19/2014 - 19:10 | 4454737 Skateboarder
Skateboarder's picture

I want to see a 'social networking' service called "Soul Cell" (because 'sell' is too obvious, but 'cell' is not, and even more powerful in concept).

Wed, 02/19/2014 - 20:07 | 4454931 asteroids
asteroids's picture

Today probably marks the TOP. History will look back at the FB deal as incredibly stupid.

Wed, 02/19/2014 - 21:23 | 4455220 nothing can go wrogn
nothing can go wrogn's picture

It may look stupid to us, but when you're in the club. It's win-win. Guys like Bezos, and Zuckerberg are certified club members. Amazon doesn't need to make money, and Facebook doesn't need a business model. That's not going to stop them from being billlionaires though. Hell no.

Some day long in to the future, we'll probably learn of some obscure Federal Reserve lending program that kept the club member tech companies flush with fresh fiat.

Wed, 02/19/2014 - 21:43 | 4455289 johnQpublic
johnQpublic's picture

never heard of either of these companies

Thu, 02/20/2014 - 02:02 | 4456224 Four chan
Four chan's picture

oi vey!

Thu, 02/20/2014 - 05:14 | 4456467 gold-is-not-dead
gold-is-not-dead's picture

WTF is 'whatsup' and why is it 16 billions? Someone in FB sniffed glue apparently.

Wed, 02/19/2014 - 20:11 | 4454932 TruthInSunshine
TruthInSunshine's picture

@camaro - you can get in at the ground floor on my new tech company called "Ow! My Balls!"

It's a multiplayer game app that electrically shocks the balls of anyone getting a trivia question wrong.

I started it with $1,800 in my basement and already turned down an offer of 800 million USD from Yahoo.

Google or Facebook will give me 10 or 30 billion USD for it by next August.

Wed, 02/19/2014 - 21:41 | 4455282 Paveway IV
Paveway IV's picture

Boring name. You need something more contemporary. How about some Asian flair?  O-me-ba! (I hope that doesn't mean something bad in Chinese)

Wed, 02/19/2014 - 21:45 | 4455298 johnQpublic
johnQpublic's picture

'batin roulette

Thu, 02/20/2014 - 01:43 | 4456178 TheRideNeverEnds
TheRideNeverEnds's picture

you should have bought the dip while you had the chance.

Wed, 02/19/2014 - 18:59 | 4454672 fonzannoon
fonzannoon's picture


Wed, 02/19/2014 - 19:21 | 4454780 monad
monad's picture

320 million fake accounts

You've been faceplanted again!

Wed, 02/19/2014 - 19:42 | 4454864 lynnybee
lynnybee's picture

I've never heard of WhatsApp. .... I have WHATSAPP on my cell phone.  WHATSAPP is very popular in the Middle East with the young people.  the Saudi gov't keeps threatening to ban WHATSAPP along with SKYPE app.

Wed, 02/19/2014 - 22:04 | 4455391 laomei
laomei's picture

Here's what it comes down to in reality, and why these buyouts will be allowed forever. Facebook can have shit ad revenue and it doesn't matter.  What matters in the end is the centralized data collection.  They want everything and they hand it over to the NSA.  In return for that, they get full support when it comes to litigation and buyouts.  It's happened before, where there was legit competition which Facebook blatantly ripped off and refused to be bought out or die and go away.  Facebook simply sues them over bullshit, and magically wins, forcing the (mostly foreign) competition under.  Facebook, as a part of this, gets really easy patents, a lot of which are pure bullshit, why? Because they hand over everything to the NSA, and for the CIA, this is basically a bunch of the world voluntarily spying on themselves and revealing all their little networks.  It's gotta be just about the dumbest fucking thing in the world for anyone sane to submit to, and it's a major reason why it's blocked in China.  

Sat, 02/22/2014 - 01:34 | 4464438 matrix2012
matrix2012's picture

"It's happened before, where there was legit competition which Facebook blatantly ripped off and refused to be bought out or die and go away.  Facebook simply sues them over bullshit, and magically wins, forcing the (mostly foreign) competition under. "


@ laomei, may you please name the name(s)

Thu, 02/20/2014 - 04:24 | 4456437 dark pools of soros
dark pools of soros's picture

probably 20million and 300mil fake 'user farms' accounts to pump up the valuations..


users are the new clicks... totally gamed

Thu, 02/20/2014 - 12:31 | 4457614 The Mist
The Mist's picture

Everybody in Europe with a smartphone uses WhatsApp nearly daily.

The users are definitely not 'fake'.

That doesn't mean it's worth 19 billion, but I can't stand the idiots here just talking trash without knowing shit.

Wed, 02/19/2014 - 18:40 | 4454625 cossack55
cossack55's picture

Throw in Japan and its a deal.

Wed, 02/19/2014 - 18:40 | 4454630 HedgeAccordingly
HedgeAccordingly's picture

Audio listen to this from BBG lol - 16 billion is about 15billion too much if you ask me..” …

Wed, 02/19/2014 - 18:41 | 4454633 fonestar
fonestar's picture


Wed, 02/19/2014 - 19:09 | 4454736 silverserfer
silverserfer's picture

look its kermit from the railyard he speaks!

Wed, 02/19/2014 - 22:03 | 4455388 johnQpublic
johnQpublic's picture

BIT coined!

Thu, 02/20/2014 - 04:24 | 4456438 dark pools of soros
dark pools of soros's picture


Wed, 02/19/2014 - 20:26 | 4454995 seek
seek's picture

So true, TruthInSunshine, I think I've seen a total of one post so far in 2014 from a collection of a half-dozen teens. FB is dead.

Thu, 02/20/2014 - 01:49 | 4456187 StychoKiller
StychoKiller's picture

You left out JCP, Sears & Kmart -- was that intentional?

Wed, 02/19/2014 - 18:39 | 4454620 Theta_Burn
Theta_Burn's picture

The header could have stopped right after "Facebook Blows" we'd have gotten the joke....


Wed, 02/19/2014 - 18:39 | 4454622 max2205
max2205's picture

This is so 2000.....100% plus 2 years before this "market' bitch blows up....sorry you will have to wait

Wed, 02/19/2014 - 18:42 | 4454636 aVileRat
aVileRat's picture

Seriously: what the fuck do the bankers and board of directors do at the meetings when Zuckerberg & Sandberg pitch this crap.

There is overpaying for a company, and then -------> waaaay over at the other end of the leaguetable is Zuck-premiums. This is well beyond Mary Meeker lvl bullshit. Someone needs to reign the kid in, maybe explain to him the whole concept of building it yourself vs. buying your way out of problems. At 200x PROJECTED Revenues, this is not even close to making sense.


Wed, 02/19/2014 - 22:57 | 4455631 Vice
Vice's picture

How DARE you post an article written by Cramer the infamous retard

Thu, 02/20/2014 - 03:49 | 4456392 Scarlett
Scarlett's picture

Well done, TIS.  Beautiful.

Wed, 02/19/2014 - 19:20 | 4454774 zaphod
zaphod's picture

I'd bet my life savings that most of Facebook's BOD had shares in this no name startup. At that level its just an inner circle jerk where the same small number of people pass shares around and that decides who wins and who loses. 

Don't believe me? Just look at Google, when they started they were 1 of 30 companies doing the exact same thing. The difference? Google's early angles/VCs passed shares around for free to all the other well connected bay area cronies, that is what make Google rise up while the other 30 fell back. 

I used to believe the US was a free market, but it's become obvious that is not the case. 

Wed, 02/19/2014 - 20:13 | 4454947 jbvtme
jbvtme's picture

as regards google success...don't forget the fumble in the endzone by later later yahoo

Thu, 02/20/2014 - 03:58 | 4456402 Scarlett
Scarlett's picture

You're mistaken.  Google had a better algorithm than the altavistas of the christmas past.

Wed, 02/19/2014 - 18:45 | 4454647 Jannn
Jannn's picture

The World Gold Council Clueless on Chinese Gold Demand?

Wed, 02/19/2014 - 19:12 | 4454748 game theory
game theory's picture

The deeper irony (besides a quote from fight club) is that these guys sold their company to FB whose only means of monetization is...wait for it...selling ads (ok...and selling databases to the NSA). Thus, the "founders' story" is revealed to be total crap.

Still, I don't understand what is propping up the FB stock price anymore.   Aside from having one of the largest global facial recognition databases which average people worldwide seem perfectly willing to keep adding to, their advertising just isn't all that effective.

Wed, 02/19/2014 - 19:49 | 4454880 lakecity55
lakecity55's picture

It's being propped up by a venture capital firm in VA called 'cia operations.'

Your taxes have helped, and are appreciated!

Wed, 02/19/2014 - 19:47 | 4454874 RmcAZ
RmcAZ's picture

So, how does this WhatsApp (which I've never heard of in my life despite working in IT and always having the latest tech) actually make money? I see their app is free and there are no ads... Did they adopt the Amazon method of wealth generation? (Moar losses = moar money?)

Thu, 02/20/2014 - 04:00 | 4456408 Scarlett
Scarlett's picture

>> their app is free 


It's $1.00

Thu, 02/20/2014 - 12:35 | 4457639 The Mist
The Mist's picture

Free in Google Playstore.

Wed, 02/19/2014 - 18:36 | 4454607 Max Damage
Max Damage's picture

I call market top with such an overpriced dumb aquisition. Either that or FED prints MOAR to let FB pay for it!!!!!

Wed, 02/19/2014 - 18:38 | 4454615 RaiZH
RaiZH's picture

I'm hoping the stupdendous amount of money Jan Koum makes out of this, does not go towards Molotov Cocktails.

Wed, 02/19/2014 - 18:38 | 4454616 jubber
jubber's picture

how many of those 320 million users are already FB users? I would have thought...320 million?

Wed, 02/19/2014 - 18:44 | 4454644 TruthInSunshine
TruthInSunshine's picture

How many of those 320 million FaceFarce users are autobots, and also Twatter "users?"

Wed, 02/19/2014 - 18:58 | 4454694 bombdog
bombdog's picture

How many of them pay anything? I can find you another billion people that will pay jack shit.

Sat, 02/22/2014 - 02:51 | 4464513 matrix2012
matrix2012's picture

You're prretty amusing bombdog :-)

"How many of them pay anything? I can find you another billion people that will pay jack shit."


I WANNA pay at or through Facebook but I have none credit card yet it won't accept any keyboard coins... I will love to dispose my fiat there... what to do then??? i'm stuck

Wed, 02/19/2014 - 18:38 | 4454618 cossack55
cossack55's picture

Can I buy WTF for $21.3 billion ?

Wed, 02/19/2014 - 18:42 | 4454635 SillySalesmanQu...
SillySalesmanQuestion's picture

In my entire adult life, I have never seen so many "useless information thingys", so underwhelming and so overvalued....

Wed, 02/19/2014 - 18:45 | 4454648 Theta_Burn
Theta_Burn's picture

You obviously haven't been to Washington DC....

Wed, 02/19/2014 - 18:45 | 4454652 Chippewa Partners
Chippewa Partners's picture

Maybe they can use the app for ZeroCare.......that ought to fix it.

Wed, 02/19/2014 - 18:48 | 4454659 NOZZLE
NOZZLE's picture

Can someone explain how the hell a free communication service (Viberator, WhatsCrapp, Fakeboobs etc.,  is going to generate revenue?  Oh yeah, I know, its all those ads for high margin products that are sold from the righthand margin that no one looks at.  Reality, the NSA funds all of this because it centralizes their data collection and profile building database.

Wed, 02/19/2014 - 18:57 | 4454688 ncdirtdigger
ncdirtdigger's picture

we have a cot waiting for you at your local FEMA camp

Wed, 02/19/2014 - 19:35 | 4454842 Winston Churchill
Winston Churchill's picture

A hot shot, and coffin is the plan.Low maintenance.

Wed, 02/19/2014 - 21:54 | 4455332 johnQpublic
johnQpublic's picture


shit sold from the right hand margin

but thanks to all those things moving on the right hand side of ZH, my favorite site, I have designed and patented a piece of manilla folder equipped with tape that i can flip up and down to hide that shit because i find it distracting

Wed, 02/19/2014 - 19:21 | 4454779 Fail2Deliver
Fail2Deliver's picture

They plan to make it up in volume.....(first Bitchez...) lol

Wed, 02/19/2014 - 19:46 | 4454872 lakecity55
lakecity55's picture

"Special Agent Fuckerberg, call on line 1."

Wed, 02/19/2014 - 21:22 | 4455213 Bangin7GramRocks
Bangin7GramRocks's picture

I'm not saying the valuation is in any way sane, but the mobile ad scheme is quite effective. Ads can be micro targeted and not easily  avoided on a mobile device. Valuable, not 100 billion valuable.

Wed, 02/19/2014 - 21:51 | 4455323 WonderDawg
WonderDawg's picture

Effective? I don't spend much time on social networks, very little time, but when I do, I don't even pause on the ads as I scroll the page. My eyes recognize a post as an ad and I skim on by. The same goes for pretty much everyone I know. How can this be effective advertising?

Wed, 02/19/2014 - 21:56 | 4455339 johnQpublic
johnQpublic's picture

shit, even tv adds are useless

i have a swivel chair and a mute button

i'd rather miss some of the show than catch some of the commercials

Wed, 02/19/2014 - 23:35 | 4455793 Blano
Blano's picture

Maybe I'm too old for this stuff, but who the hell buys stuff from an ad that pops up on their phone?  How stupid!!

Thu, 02/20/2014 - 18:34 | 4459539 monad
monad's picture

Your phone carrier has claimed that your location information is their property. Your phone gives the advertisers your location, which they use to target you. Then everyone sells your behavior data like this is a rat lab. 

Thu, 02/20/2014 - 06:30 | 4456506 BorisTheBlade
BorisTheBlade's picture

Generating revenue is an outdated concept ... until it's not. Blowing bubbles be it in real estate, dotcoms etcetera is one last way to keep economy afloat, which in itself is one big fantasy. Facebook is just one relatively small example of fraudulent nature of today's capital markets.

Wed, 02/19/2014 - 18:52 | 4454670 Its_the_economy...
Its_the_economy_stupid's picture

When you are given money for nothing, you will give money fro nothing. This purchase is a SMALL example of this at work. There are much BIGGER examples.

Wed, 02/19/2014 - 18:54 | 4454679 Papasmurf
Papasmurf's picture

If you can't beat them, buy them.

Wed, 02/19/2014 - 18:54 | 4454680 kevinearick
kevinearick's picture

No one is in charge of opensource and everyone is in charge, individually. It’s a switch. It works one way when it is left in the public domain and another when it is hijacked to engineer monopoly.

I don’t know how my own kernel works, much less how the code of others works, because it creates its own variables; it adapts creatively, to anticipate, which is why the proprietary coders cannot escape. All they can do is expend energy coding what is already anticipated. Don’t write your code to compute its own bias and expect not to get hung up, unless you want to print money in a positive feedback loop with stupid.

Wed, 02/19/2014 - 19:01 | 4454693 honkadoo
honkadoo's picture

So insane.  They could have bought Pandora and Spotify (with money left over to buy SnapChat if they wanted)... They could have dominated the online music space within the Facebook app and gone against Apple.

Instead they blow $16 billion on an app that 320 million people supposedly use?  They should have just bought Tyler's list above... Then they get an airline, a telco and a hotel and a food services company.

Well done.

Wed, 02/19/2014 - 19:37 | 4454846 booboo
booboo's picture

Because the NSA does not give a shit what our taste is in music, they just want to know what phoney law we admitted to violating so they can detain under the patriot act.

Wed, 02/19/2014 - 18:59 | 4454696 pitz
pitz's picture

Do FB shareholders think they'll ever see a return on their investment with the way that the business has been conducted? 

Wed, 02/19/2014 - 19:02 | 4454709 williambanzai7
williambanzai7's picture

Wed, 02/19/2014 - 19:04 | 4454716 Manipuflation
Manipuflation's picture

LOL William;-)

Wed, 02/19/2014 - 20:10 | 4454938 The Fonz...befo...
The Fonz...before shark jump's picture

Lmfao brilliant!

Welcome to the big leagues Nigerian....this jpmorgan/cia pump and dump had the benefit of a major motion picture to come out prior to ipo to soften up the ground and I hope you didn't buy into that Facebook was responsible for the Arab spring nonsense when it did ipo....that was just hype pumping....anyways...

At the end of the day all you own are shares in a digital phone book that has a multi billion dollar marketcap and a triple digit P/E ratio

But this digital phone book company will keep growing (as long as the power grid keeps working)....

Just remember millions of fake new Facebook Id and profiles are being created and added every help pad the stats going forward....

Wed, 02/19/2014 - 19:03 | 4454710 phijammaslamma
phijammaslamma's picture

Sequoia's take on WhatsApp aquistion. (Sequoia invested $8 million into the company in 2011.  Their stake is worth ~$2.4 BLN now for a 30,000% return in less than 5 years. )

Wed, 02/19/2014 - 19:03 | 4454713 Manipuflation
Manipuflation's picture

When are we finally going to get our shit together around here and develop FuckOffApp?  I bet we could make billions.

Wed, 02/19/2014 - 19:24 | 4454793 Sokhmate
Sokhmate's picture

The app has actually existed even before smart phones. If you own a phone, you can still get it, but only if you get rid of your phone. And it's free.

Wed, 02/19/2014 - 19:07 | 4454727 zipit
zipit's picture

What's a good WhatsApp alternative?

Wed, 02/19/2014 - 19:13 | 4454750 gafgroocK
gafgroocK's picture




Whelp, 'snatchchat' had one issued Patent that is the equivalent of Toilet Paper.I couldn't stop laughing at the Claims they were that bad. Method Claims to boot!


Have not checked if 'whatsthat' has ANY.


Mark it down, when that spoiled punk from 'snatchchat' turned down the 3-4 Billion in CASH it was the dumbest Business decision ever made.

Thu, 02/20/2014 - 03:32 | 4456370 laomei
laomei's picture

wechat. same basic thing but better

Sat, 02/22/2014 - 04:32 | 4464577 matrix2012
matrix2012's picture

Yes, WeChat, and if one is tired of the NSA archiving of Google - Yahoo - Hotmail, try the one from WeChat sibling: QQMail, they have the Eng front-end -


QQMail offers on par with what Google mail may offer minus NSA services,,, and, hey, they ask NO phone number from you :-) less busy body is a sure charm!!

Wed, 02/19/2014 - 19:10 | 4454740 marriedgeordie
marriedgeordie's picture

the first thing i did after reading the news was check wiki for the names of snapchat developers. and, lo and behold, there are a couple of nice jewish kids in the list.... this is merely a way of keeping the money siphoned from the stoopid dumbfucks ((c)Zuckergerg) within the tribe.

Wed, 02/19/2014 - 19:13 | 4454742 williambanzai7
williambanzai7's picture

And in an instant FaceBook just got your phone number.

Verified users is what Facebook and the NSA want.

Wed, 02/19/2014 - 19:31 | 4454825 Atomizer
Atomizer's picture

Well done. WB7.

Fuck the liberal MSM racists defending a US negro President committing US Constitutional crimes.

Wed, 02/19/2014 - 19:40 | 4454852 lakecity55
lakecity55's picture

If Bath House was a YT, his buggered ass would have been gone already.

Sorry, but I still believe in MLK's "Character is what counts, not skin color."

I also do not think MLK would have cottoned to a Down-Low Bro

Wed, 02/19/2014 - 21:09 | 4455150 DrunkenMonkey
DrunkenMonkey's picture

The NSA can get all those details from Paypal or your Bank / Telco.

This is more-likely to be over-exuberance, after all one should never attribute to malice, that which can be adequately explained by stupidity.

Wed, 02/19/2014 - 21:34 | 4455255 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

The more photos and higher resolution the better the better they can fine tune facial recognition software filters to track movements in real time through areas of importance to 'national security' like airports or downtown Manhattan for example. It is not about brown people.

Wed, 02/19/2014 - 21:25 | 4455231 MeelionDollerBogus
MeelionDollerBogus's picture

And Google.
Yahoo even tried pushing it a little. I will never comply.

Wed, 02/19/2014 - 19:11 | 4454744 syntaxterror
syntaxterror's picture

$16 billion for an IM chat tool? I guess that pegs Adobe Photoshop at about $300 billion. ADBE is wayyyyyyy underpriced then!

Wed, 02/19/2014 - 19:20 | 4454773 pragmatic hobo
pragmatic hobo's picture

hell ... everything is under-priced in comparison ... dow 1000000 here we come.

Wed, 02/19/2014 - 19:11 | 4454745 silverserfer
silverserfer's picture

Facebook stock is a play on a FED/CIA mechanism. They like their facebooks cause they take down governments. Facebooks makes them lots of money and pilages lots of gold for these cock suckers. Not just selfies of people ans their pussy-cats.

Wed, 02/19/2014 - 19:15 | 4454756 X-defiler
X-defiler's picture

This is sooo boring. We won't even remember Facefart when we are trying to heat our camp with books and furnature. 

Wed, 02/19/2014 - 19:36 | 4454845 lakecity55
lakecity55's picture

All it takes is One Big Solar Flare!

Long Carrington Event(s).

Wed, 02/19/2014 - 21:08 | 4455144 MeelionDollerBogus
MeelionDollerBogus's picture

You will if you carve all the little leftover wood-bits into "like" thumbs up facebook icons in 3D to use as kindling.

Wed, 02/19/2014 - 19:19 | 4454770 monad
monad's picture

This isn't rocket science. If a few bad apples at Barclay's can sell customer prfiles out the back door for $20 a pop, and since you saps aren't paying for the *free* text messaging service, this volume of raw monkey communication content - even stripped of personal identification (not!) is worth more than $50 a scalp to the criminal elite parasites. That giant sucking sound is your lives being vaporized. Be responsible and don't leave a big footprint for Al Gore's tribe to have to clean up after you're all gone, m'k? Its so much work explaining away the artifacts. You don't want to traumatize their children with the ugly truth, do you? 

Wed, 02/19/2014 - 19:22 | 4454784 jmp esp
jmp esp's picture

Fuck Facebook and pretty much every other non SaaS website that purports to be a business.

Wed, 02/19/2014 - 19:23 | 4454786 Atomizer
Atomizer's picture




CIA's 'Facebook' Program Dramatically Cut Agency's Costs


Facebook CIA connection

Recently in between the 2014 dilemma.


IMHO, creating alarmist fear will only backfire on the controlling interest. Please? Can I manufacture a derivatives debt game on this? Soros told me we are going to wipe out the financial bottom feeders.



Wed, 02/19/2014 - 19:23 | 4454787 lakecity55
lakecity55's picture

Gee, I am sorry, but what kind of manufactured goods produced or resources does this company mine and refine? Or are they in transportation and own a lot of rolling stock? There must be some hard assets in hand for them to have such a highy-valued stock.

Maybe I should get in on this fazebook thing. Is it on the NYSE or the AMEX???

Wed, 02/19/2014 - 19:32 | 4454829 Atomizer
Atomizer's picture

NSA/IRS data mining.

Wed, 02/19/2014 - 19:45 | 4454870 jmp esp
jmp esp's picture

They have datacenters, but those are hardly a justification, and they will depreciate, as does all such hardware.

Wed, 02/19/2014 - 19:24 | 4454791 adr
adr's picture

I guess my problem is I'm trying to design products that actually make money.

Fuck I need to figure out something that loses hundreds of millions so I can make billions.

Wed, 02/19/2014 - 19:35 | 4454840 lakecity55
lakecity55's picture

Agree with your dilemma, ADR. Remember, the original dot-com: "Hey, I bought stock in!" "What do they do?" "I dunno, but it's Dot-Com, dude! It's cutting edge!! I'll be rich!

Wed, 02/19/2014 - 19:36 | 4454843 Atomizer
Atomizer's picture

Declare yourself a Green Energy company and steal from the DOE taxpayer coffer.

Solyndra business model 101.

Thu, 02/20/2014 - 00:57 | 4456046 johnQpublic
johnQpublic's picture

green instant energy messaging service

Wed, 02/19/2014 - 19:24 | 4454792 Spungo
Spungo's picture

It never fully clicked just how fucked up the stock market is. Coca-Cola is known around the world. Coke has been around for more than a century and it will probably be around long after I'm dead. Twitter is worth almost 3x as much as Coca-Cola but I don't know 1 person who uses it.

Wed, 02/19/2014 - 19:26 | 4454807 adr
adr's picture

I don't have a Twitter account, never seen anyone selling Herbalife, gave up on Facebook three years ago. I mean I've seen two Teslas but they have almost 40% the market cap of Ford. I think I see more than 5 Fords every day.

This is insane, there is no other word.

Thu, 02/20/2014 - 01:02 | 4456061 johnQpublic
johnQpublic's picture

i dont have a twitter account

i've never sen anyone selling herbalife, and i'm not sure what the product is but it sound like a pyramid scheme to me

never been on face book or anything like it

have a pre pay toss away cell

never seen a tesla other than pictures

i drive a ford...because i'm A plan and no other reason

and how 'bout the word 'retarded'?

Wed, 02/19/2014 - 19:41 | 4454857 jmp esp
jmp esp's picture

If you're into computers to any degree, this should resonate with you: Facebook's market cap exceeds that of Intel.

Wed, 02/19/2014 - 21:05 | 4455130 MeelionDollerBogus
MeelionDollerBogus's picture

You're on Zerohedge.

Guess what, genius...

It's OK, irony is a vital nutrient.

Wed, 02/19/2014 - 21:23 | 4455218 DrunkenMonkey
DrunkenMonkey's picture

Sounds like Coca-cola and, by extension, all stock markets worldwide are way under-priced.


Wed, 02/19/2014 - 22:13 | 4455424 Not Goldman Sachs
Not Goldman Sachs's picture

KIDS!  Sadly, the future.

Wed, 02/19/2014 - 23:25 | 4455763 dognamedabu
dognamedabu's picture

Coke's (KO) market cap is ~$160 Billion. This story refers to Coca Cola Enterprises (CCE) market cap. 

Wed, 02/19/2014 - 19:26 | 4454806 Waterfallsparkles
Waterfallsparkles's picture

Easy come eazy go.

Wed, 02/19/2014 - 19:28 | 4454813 Darksky
Darksky's picture

Am i stupid because i dont know what any of those 30 companies do?

Wed, 02/19/2014 - 19:41 | 4454858 lakecity55
lakecity55's picture

No, it means you are not a chump.

Wed, 02/19/2014 - 19:42 | 4454860 jmp esp
jmp esp's picture

No, you'd be stupid if you did and it made sense.

Wed, 02/19/2014 - 20:06 | 4454923 williambanzai7
williambanzai7's picture

Wed, 02/19/2014 - 20:18 | 4454967 Chuck Knoblauch
Chuck Knoblauch's picture

US Government is Facebook's largest customer. Feeling kinda invincible when your largest customer has the ability to print its own money.

Wed, 02/19/2014 - 20:22 | 4454985 satoshi411
satoshi411's picture

Facebook is now the USA law enforcements #1 tool.

Cop's all over America are now invincible fighting crime from their PC eating donuts and drinking coffee.

Now the bad guys simply POST their crime with photo's, and the cop's just PICK&CHOOSE who to BUST.

"reality is always stranger than fiction, fiction must make sense" - Twain

FUCK FACEBOOK, and all those who use it.

Wed, 02/19/2014 - 20:23 | 4454986 The Fonz...befo...
The Fonz...before shark jump's picture

Millions of fake Facebook accounts as mentioned before on ZH....yet they count them new subscribers to try and justify their market cap and growth...if a bricks and mortar company lied and inflated about the number of new customers/contracts they have signed up the regulators would be all over them....

I demand a digital audit of Facebook so that we could get a real grasp at how many REAL people actually are regular Facebook users....would it be close to the billion these guys are claiming?

Come on SEC

Wed, 02/19/2014 - 20:28 | 4455004 I_Am_
I_Am_'s picture


Wed, 02/19/2014 - 20:33 | 4455020 bluskyes
bluskyes's picture


Wed, 02/19/2014 - 20:50 | 4455079 pupdog1
pupdog1's picture

"The company, which allows users to send messages over the web for free ..."

I call this "e-mail."

Wed, 02/19/2014 - 21:59 | 4455363 Manipuflation
Manipuflation's picture

Skype?  That way the facial recognition software kicks in.

Wed, 02/19/2014 - 21:05 | 4455131 MrVincent
MrVincent's picture

Remember when Drawsomething had 300 million users?

Wed, 02/19/2014 - 21:24 | 4455223 thorgodofthunder
thorgodofthunder's picture

Simple question- why would Facebook do something so stupid?

Serious responses only please.

Wed, 02/19/2014 - 21:57 | 4455350 Manipuflation
Manipuflation's picture

Politcos use the FB platform ad nauseum to promote their agendas, campaigns and fund raising from what I have seen.  FacePlant makes a great analytic tool for demographics. 

Wed, 02/19/2014 - 22:18 | 4455357 haskelslocal
haskelslocal's picture


Wed, 02/19/2014 - 21:56 | 4455341 Winston Smith 2009
Winston Smith 2009's picture

Watch this if you haven't already.  Facebook, all smoke and mirrors:

Facebook Fraud

Wed, 02/19/2014 - 22:42 | 4455563 Fight-Club
Fight-Club's picture

And this one from the same guy.  Very insightful.

Wed, 02/19/2014 - 23:47 | 4455837 Blano
Blano's picture

I found the first part of the video interesting, but social media is so boring to me I had no interest in finishing it.

Wed, 02/19/2014 - 22:02 | 4455384 Spungo
Spungo's picture

"Today probably marks the TOP. History will look back at the FB deal as incredibly stupid."

To put all of this in context, I want everyone to remember that MySpace only cost 0.58 billion, and that was seen as one of the dumbest purchases ever.

Thu, 02/20/2014 - 00:31 | 4455971 MedicalQuack
MedicalQuack's picture

It just so happened last night that PBS aired their documentary "Generation Like"...all the marketing that teenagers are fed and they did some good work on this with how it messes with them as well as talking about the big dollars made. 

Movie companies, work it and work and work it...they wouldn't appear on screen.  One little guy 13 years old from a poor neighborhood gets some views on his skateboard videos and then it's not enough so he has change and does some not so nice videos, a little 13 year old sometimes humping that part is sad when it goes that way for attention and the "likes".

Again, people can't seperate virtuals worlds and values from the real world anymore. 

Thu, 02/20/2014 - 00:39 | 4455999 hesk
hesk's picture

I hate all this shit, As an 33 year old man sitting in a college classes with these idiots. If I hear "Yo, look at u snapchat yo." I'll flip.

Thu, 02/20/2014 - 04:10 | 4456423 the tower
the tower's picture

FB is so lame. Just as Whatsapp hits the height of popularity all the cool kids are switching to Viber.

FB bought a dead horse.

Besides... how are they going to get those $50 per user back? Plus profit?

This would be a very good moment to sell your FB stock.

Thu, 02/20/2014 - 04:38 | 4456447 Dr_D
Dr_D's picture

Now Whatsapp is a great product/concept - unfortunately, like Twitter, it totally lacks a valid business model behind it. Only value in this transaction is that Facebook got rid of a much better messenger competing with its own...

Thu, 02/20/2014 - 06:03 | 4456486 Zero-risk bias
Zero-risk bias's picture

Seems this is the news the world over today, this startup versus that. How everyone wants a piece, but as has already been said above, apart from the main players in each region, there's not much of a business model. That's because adds don't really work.

So, the main goal seems to be to get everone using the same network. Real name registration, sharing links which are validated and okayed by gov friendly media channels. It's just control of information, nothing more nothing less.

The fact that I have to pay a monthly subscription just so I can send emails and read zerohedge is enough. I'm not actually going to start paying for faster services, or pay for services beyond that, when half the internet is censored, or unavilable in my region.

Thu, 02/20/2014 - 08:02 | 4456611 22winmag
22winmag's picture

They don't call it FarceBook for nothing!

Thu, 02/20/2014 - 09:00 | 4456727 Rising Sun
Rising Sun's picture

Faceplant is just playing year 2000 all over again.

Thu, 02/20/2014 - 11:12 | 4457263 Platinum_Investor
Platinum_Investor's picture

This is amazing !   Over inflated stock prices drive valuations

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