Facebook losing money ?!

Today to my astonishment I read that facebook, commonly recognised as the biggest and most successful social media website in the world is currently running at a loss and has not yet generated a profit in any financial year since launch. What I think makes this even more astounding are some of the facebook statistics which they actively promote via their own website -

• More than 200 million active users worldwide
• More than 100 million users log on to facebook at least once each day
• More than two-thirds of facebook users are outside of education
• The fastest growing demographic is those 35 years old and older

With this kind of consumer audience and what seems to be a fairly cost effective and simple advertising model, what is going wrong? Is too much time being spent on developing clever functionality and not enough focus being put into generating revenues?

If we are to believe what is reported, Facebook founder Mark Zuckerberg isn’t interested in making money, it’s more about connecting people (which I think is easy to say when you reported to be worth over $1.5 billion!!) but with his personal fortune depleting at a rapid rate, will his focus change?

In a recent interview the BBC’s Rory Cellan-Jones speaks to facebook Chief Operating Officer, Sheryl Sandberg about facebook revenues, piracy and what the future holds.

Facebook losing money interview

However much Sheryl claims that it’s all part of their global plan, in my opinion facebook needs to get its business model in order before they miss the boat, in case they haven’t heard, Twitter has arrived!

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