Wednesday, June 11, 2008

The face of Facebook

Two weeks ago, EMTV featured Facebook on its popular Sunday night news programme, 60 Minutes, introducing thousands of Papua New Guineans to this website that is taking the world by storm.

Are you on Facebook yet?

More than 60 million people already are and by the end of the year, it'll be 200 million.

That's how fast it's spreading.

Here's how it works.

All you have to do is set up a profile page about yourself.

From there you can swap news and photos with friends, track down old acquaintances, and even play long distance Scrabble.

It can be a very useful tool, or an addictive time-waster.

Either way, Facebook has created an Internet revolution.

And as we so enviously discovered on 60 Minutes, it's now a US $15 billion business, the creation of one very young, very geeky computer whiz-kid.

This is the face of Facebook - Mark Zuckerberg, the 23-year-old mogul who is guiding its extraordinary growth.

What everyone wants to know is - is he old enough to be running a company that some people say is the biggest thing since Google?

“I'm 23 right now,” Zuckerberg humbly told Lesley Stahl of American 60 Minutes.

“It's not that big.

“It used to be the case like, you'd switch jobs, and then maybe you wouldn't keep in touch with all the people that you knew from that old job.

“Just 'cause it was too hard.

“But one of the things that Facebook does is it makes it really easy to just stay in touch with all these people.”

Facebook's headquarters in downtown Palo Alto, California, looks like a dorm room.

The 400 employees, who get free food and laundry, show up late, stay late, and party really late.

Zuckerberg, who has made the cover of 'Newsweek' and is reportedly worth US$3 billion, sits at a desk like the other software engineers, writing computer code.

He told Lesley Stahl that he has neither changed his lifestyle or into buying really expensive clothes.

“No, I'm not buying really expensive clothes,” Zuckerberg says.

“No, I have a little, like, one-bedroom apartment with a mattress on the floor.

“That's where I live.”

Kara Swisher, who used to write about Silicon Valley for the 'Wall Street Journal' has called him 'The Toddler CEO'.

“I think it's hard,” Swisher says of Zuckerberg.

“I think when all of a sudden you're the smartest person in the world, and you're the meal ticket for everybody, and this is the big hit, this is the new Google, at this point, and so Mark is under a lot of pressure because everybody wants something from him.”

Like the founders of Google, Larry Page and Sergey Brin, Mark Zuckerberg is looked up to in Silicon Valley as a visionary.

He can be awkward and reluctant to talk about himself, so you have to turn for help to his Facebook page.

His Mom is a psychiatrist and his Dad is a dentist.

Mark was a computer whiz early on, writing software in sixth grade.

In his second year at Harvard he and his two roommates created an online version of the Harvard student directory where kids could message each other.

They called it The Facebook and launched it from their dorm room.

Within four months they had expanded to 40 colleges and over the summer moved to Palo Alto.

“Probably about half my time is spent on business operation-type stuff,” he says.

Despite his young age, Zuckerberg seems to have made one savvy business decision after the next.

He expanded access to Facebook from college students to high schoolers.

Then in 2006, to adults - his fastest growing demographic.

Now he's inviting everyone on the site to create new software and pocket the profits themselves.

It's a way to keep the next big thing on Facebook.

New programs emerge daily, like Facebook Scrabble.

“ I actually have a couple games going on now with my grandparents, so, they got on Facebook and we started playing Scrabble together,” Zuckerberg says,

Facebook is growing so quickly, there is talk of it becoming a "giant slayer" which is why Yahoo! offered to buy Facebook in 2006 for US$1 billion in cash.

Zuckerberg declined.

But then Microsoft swooped in and bought 1.6% of the company for US$240 million.

That meant that Bill Gates valued Facebook at $15 billion, roughly the same as Ford or CBS.

Some analysts say that's wildly unrealistic since Facebook has yet to figure out how to make money off its huge audience.

“I think that's a pretty relative thing,” he says.

“But I mean, as a private company, we just have the advantage of not necessarily having to report to the outside world all of our financials.

He may duck the question, but there is no getting around the fact that Facebook needs to find a way to generate revenue.

And so Zuckerberg is experimenting with ads, trying to cash-in on his users's own recommendations.

Say you write on Facebook that you like a certain movie, that's turned into an ad.

Or maybe you like a scarf from Bloomingdale's.

“So this isn't an ad that's going to go to a lot of people,” he says.

“Basically, when you put that information in your profile that you bought a scarf and that you like that scarf, that's something that your friends might find interesting, right?

“So what we'd do is we might show that information to your friends a little bit more pro-actively, as an ad.”

The real trouble started when they began using a tracking program, called Beacon, that monitors what you buy on over 40 web sites and automatically reports it to your friends, without explicit permission.

People signed up for Facebook thinking that it was a way to just stay in touch with their friends, and now, some of them feel that there's some snooping going on.

“I actually think that this makes it less commercial,” Zuckerberg replies.

“I mean, what would you rather see?

“A banner ad from Bloomingdale's or that one of your friends bought a scarf?”

But when a Facebook user bought his wife a diamond ring online, the surprise was ruined because Beacon notified all his friends and his wife about it, on Facebook.

With stories like that, criticism of Beacon began to build.

But Zuckerberg dug in his heels until he had a full-blown PR disaster on his hands, including petitions and bloggers writing obituaries.

“It might take some work for us to get this exactly right,” he says.

“This is something we think is going to be a really good thing.”

So does Zuckerberg think that his age is an asset or a liability?

“There's probably a little bit of both, right?

“I mean, there are definitely elements of experience, and stuff, that someone my age wouldn't have.

“But there are also things that I can do that other people wouldn't necessarily be able to.”

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