I was tempted to tell everyone who thought 15 big b’s for Facebook was excessive to look at Google’s $100 Billion valuation at IPO.
But then, it struck me, rather forcefully I might add, that Google and Facebook are completely unrelated in terms of price. Google, despite being mostly a search page, actually gets stuff done. Look at Google Earth, Product Search, Their Wifi work both in San Francisco and with the FCC with regards to buying that spectrum, Desktop Search, Google Co-Op, Reader, Analytics, and, much, much more. The GooglePlex is a daily gathering of the brightest dev’s on the planet.
Google, in other words, has plenty of reasons to justify its price tag.
What, pray, has Facebook done?
The question stands, but Kara Swisher beat me to the observation already (albeit from a slightly different angle):
Facebook is not Google: Although many in the tech sector make the comparison to the search giant, it is simply incorrect.
Is Facebook like Yahoo a bit? Certainly. A newfangled version of AOL? Absolutely! A very well done media play with all sorts of interactive bells and whistles hanging off of it? Yes, ma’am.
Indeed, it is growing its media business nicely, with $30 million in profits on $150 million in revenue.
But in comparative terms to the search giant, Facebook is a lemonade stand. Google brought in $3.9 billion in revenue in just the second quarter alone and, um, is increasing its dominance over the search sector in a mighty scary way.
Facebook, on the other hand, gets half its annual revenue right now from a sweetheart guaranteed revenue deal with, drum roll, Microsoft. No matter what either Facebook or Microsoft says, it is a money-losing deal for Microsoft so far.
How do I know this? According to many sources, Google is struggling to make ends meet in its own sweetheart guaranteed ad deal with Facebook rival MySpace, which is much larger, and Google has the best monetization engine out there.