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News Microsoft invests £117m in Facebook

Discussion in 'Article Discussion' started by CardJoe, 25 Oct 2007.

  1. Veles

    Veles DUR HUR

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    Still, MS are a company, they didn't become so rich by throwing money around willy nilly. They may have made some bad investments, but they won't buy something "because they can", if it doesn't advantage the company in some way.
     
  2. The_Beast

    The_Beast I like wood ಠ_ಠ

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    they only bought 16% of the company
     
  3. Mister_Tad

    Mister_Tad Super Moderator Super Moderator

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    out by a bit there - 1.6%, hence the obscene valuation of $15bn
     
  4. Neogumbercules

    Neogumbercules New Member

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    Am I the only one that doesn't give a crap about this whole social networking fad? I'm the only person my age that I know that doesn't have a myspace.
     
  5. bloodcar

    bloodcar Active Member

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    Um, Facebook does hold a $15bn valuation now dude.
     
  6. Veles

    Veles DUR HUR

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    Based on the profits the site generates this is a huge over-valuation, even if it is really valued at this number. It's artificially inflated due to MS's high price of the 1.6% share because they weren't investing in the site purely for it's profit margins.
     
  7. bloodcar

    bloodcar Active Member

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    Well duuuuh. Microsoft one the deal with Facebook thanks to the massive valuation. That point was originally in the article, I guess it was snipped by the editing gods.
     
  8. xrob

    xrob New Member

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    ...
     
    Last edited: 29 Jul 2012
  9. Pimp Daddy

    Pimp Daddy Halt! Hammerzeit!

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    I'll be interested in seeing the type of advertising that they do. If they used images/flash files then they will be blocked by adblocking plugins in browsers. It would be better for them if they went for more subtle, text-based ads.
     
  10. mclean007

    mclean007 Officious Bystander

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    Thanks for that educated and sarcastic comment. I happen to have a grasp of basic arithmetic and am more than able to calculate that $240m/0.016 = $15bn. However, it's a gross oversimplification to extrapolate from that that Facebook is actually WORTH $15bn. Even in fantasy dot-com land you don't get a $15bn valuation off the back of $150m of earnings. Period. If Facebook floated on a stockmarket tomorrow, it wouldn't raise $15bn (well, it wouldn't raise anything because tomorrow's Saturday and the markets are closed, but you get the point). The value of Microsoft's investment lies not in the fundamental value of the shares but in the rights Microsoft has presumably gained as regards exclusivity to serve Facebook's banner ads.
     
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