.
 | |
| Type | Private |
|---|---|
| Founded | Cambridge, Massachusetts[1](2004) |
| Founder | |
| Headquarters | Palo Alto, California, U.S., will be moved to Menlo Park, California, U.S. in June 2011 |
| Area served | Worldwide |
| Key people |
|
| Revenue |  US$2 billion (2010 est.)[2] |
| Net income | N/A |
| Employees | 2000+(2011)[3] |
| Website | facebook.com |
| IPv6 support | www.v6.facebook.com |
| Alexa rank |  2 (March 2011[4]) |
| Type of site | Social networking service |
| Advertising | Banner ads, referral marketing, casual games |
| Registration | Required |
| Users | 600 million[5][6] (active in January 2011) |
| Available in | Multilingual |
| Launched | February 4, 2004 |
| Current status | Active |
Facebook (stylized facebook) is a social networking service and website launched in February 2004, operated and privately owned by Facebook, Inc.[1] As of January 2011, Facebook has more than 600 million active users.[5][6] Users may create a personal profile, add other users as friends, and exchange messages, including automatic notifications when they update their profile. Additionally, users may join common interest user groups, organized by workplace, school or college, or other characteristics. The name of the service stems from the colloquial name for the book given to students at the start of the academic year by university administrations in the United States to help students get to know each other better. Facebook allows anyone who declares themselves to be at least 13 years old to become a registered user of the website.
Facebook was founded by Mark Zuckerberg with his college roommates and fellow computer science studentsEduardo Saverin, Dustin Moskovitz and Chris Hughes.[7]The website's membership was initially limited by the founders to Harvard students, but was expanded to other colleges in the Boston area, the Ivy League, and Stanford University. It gradually added support for students at various other universities before opening to high school students, and, finally, to anyone aged 13 and over.
A January 2009 Compete.com study ranked Facebook as the most used social networking service by worldwide monthly active users, followed by MySpace.[8]Entertainment Weekly included the site on its end-of-the-decade "best-of" list, saying, "How on earth did we stalk our exes, remember our co-workers' birthdays, bug our friends, and play a rousing game of Scrabulous before Facebook?"[9] Quantcast estimates Facebook has 135.1 million monthly unique U.S. visitors in October 2010.[10] According to Social Media Today, in April 2010 an estimated 41.6% of the U.S. population had a Facebook account.[11]
FacebookHistory
Mark Zuckerberg wrote Facemash, the predecessor to Facebook, on October 28, 2003, while attending Harvard as a sophomore. According to The Harvard Crimson, the site was comparable toHot or Not, and "used photos compiled from the online facebooks of nine houses, placing two next to each other at a time and asking users to choose the 'hotter' person".[12][13]
To accomplish this, Zuckerberg hacked into the protected areas of Harvard's computer network and copied the houses' private dormitory ID images. Harvard at that time did not have a student "facebook" (a directory with photos and basic information). Facemash attracted 450 visitors and 22,000 photo-views in its first four hours online.[12][14]
The site was quickly forwarded to several campus group list-servers, but was shut down a few days later by the Harvard administration. Zuckerberg was charged by the administration with breach of security, violating copyrights, and violating individual privacy, and faced expulsion. Ultimately, however, the charges were dropped.[15]Zuckerberg expanded on this initial project that semester by creating a social study tool ahead of an art history final, by uploading 500 Augustan images to a website, with one image per page along with a comment section.[14] He opened the site up to his classmates, and people started sharing their notes.
The following semester, Zuckerberg began writing code for a new website in January 2004. He was inspired, he said, by an editorial in The Harvard Crimson about the Facemash incident.[16] On February 4, 2004, Zuckerberg launched "Thefacebook", originally located at thefacebook.com.[17]
Six days after the site launched, three Harvard seniors, Cameron Winklevoss, Tyler Winklevoss, andDivya Narendra, accused Zuckerberg of intentionally misleading them into believing he would help them build a social network called HarvardConnection.com, while he was instead using their ideas to build a competing product.[18] The three complained to the Harvard Crimson, and the newspaper began an investigation. The three later filed a lawsuit against Zuckerberg, subsequently settling.[19]
Membership was initially restricted to students of Harvard College, and within the first month, more than half the undergraduate population at Harvard was registered on the service.[20] Eduardo Saverin(business aspects), Dustin Moskovitz (programmer), Andrew McCollum (graphic artist), and Chris Hughes soon joined Zuckerberg to help promote the website. In March 2004, Facebook expanded toStanford, Columbia, and Yale.[21] It soon opened to the other Ivy League schools, Boston University,New York University, MIT, and gradually most universities in Canada and the United States.[22][23]
Facebook incorporated in the summer of 2004, and the entrepreneur Sean Parker, who had been informally advising Zuckerberg, became the company's president.[24] In June 2004, Facebook moved its base of operations to Palo Alto, California.[21] It received its first investment later that month fromPayPal co-founder Peter Thiel.[25] The company dropped The from its name after purchasing thedomain name facebook.com in 2005 for $200,000.[26]
Date | Users (in millions) | Days later | Monthly growth[N 2] |
|---|---|---|---|
| August 26, 2008 | 100[27] | 1,665 | 178.38% |
| April 8, 2009 | 200[28] | 225 | 13.33% |
| September 15, 2009 | 300[29] | 150 | 10% |
| February 5, 2010 | 400[30] | 143 | 6.99% |
| July 21, 2010 | 500[31] | 166 | 4.52% |
| January 5, 2011 | 600[32][N 3] | 168 | 3.57% |
Facebook launched a high-school version in September 2005, which Zuckerberg called the next logical step.[33] At that time, high-school networks required an invitation to join.[34] Facebook later expanded membership eligibility to employees of several companies, includingApple Inc. and Microsoft.[35]Facebook was then opened on September 26, 2006, to everyone of age 13 and older with a valid email address.[36][37]
On October 24, 2007, Microsoft announced that it had purchased a 1.6% share of Facebook for $240 million, giving Facebook a total implied value of around $15 billion.[38] Microsoft's purchase included rights to place international ads on Facebook.[39] In October 2008, Facebook announced that it would set up its international headquarters in Dublin, Ireland.[40] In September 2009, Facebook said that it had turned cash flow positive for the first time.[41] In November 2010, based on SecondMarketInc., an exchange for shares of privately held companies, Facebook's value was $41 billion (slightly surpassing eBay's) and it became the third largest US web company after Google and Amazon.[42]Facebook has been identified as a possible candidate for an IPO by 2013.[43]
Traffic to Facebook increased steadily after 2009. More people visited Facebook than Google for the week ending March 13, 2010.[44] Facebook also became the top social network across eight individual markets — in Australia, the Philippines, Indonesia, Malaysia, Singapore, New Zealand, Hong Kong and Vietnam — while other brands commanded the top positions in certain markets, including Google-owned Orkut in India, Mixi.jp in Japan, CyWorld in South Korea, and Yahoo!'s Wretch.cc in Taiwan.[citation needed]
In March 2011 it was reported that Facebook removes approximately 20,000 profiles from the site every day for various infractions, including spam, inappropriate content and underage use, as part of its efforts to boost cyber security.[45]
In early 2011, Facebook announced plans to move to its new headquarters, the former Sun Microsystems campus in Menlo Park, California.[46][47]
Company
Ownership
Mark Zuckerberg owns 24% of the company, Accel Partners owns 10%, Digital Sky Technologies owns 10%,[48] Dustin Moskovitz owns 6%, Eduardo Saverin owns 5%, Sean Parker owns 4%, Peter Thiel owns 3%, Greylock Partners and Meritech Capital Partners own between 1 to 2% each, Microsoft owns 1.3%, Li Ka-shing owns 0.75%, the Interpublic Group owns less than 0.5%, a small group of current and former employees and celebrities own less than 1% each, including Matt Cohler, Jeff Rothschild, Adam D'Angelo, Chris Hughes, and Owen Van Natta, while Reid Hoffman and Mark Pincus have sizable holdings of the company, and the remaining 30% or so are owned by employees, an undisclosed number of celebrities, and outside investors.[49] Adam D'Angelo, chief technology officer and friend of Zuckerberg, resigned in May 2008. Reports claimed that he and Zuckerberg began quarreling, and that he was no longer interested in partial ownership of the company.[50]
Management
Key management personnel comprise Chris Cox (VP of Product), Sheryl Sandberg (COO), and Donald E. Graham (Chairman). As of April 2011, Facebook has over 2,000 employees, and offices in 15 countries.[51]
Revenue
Most of Facebook's revenue comes from advertising. Microsoft is Facebook's exclusive partner for serving banner advertising,[52] and as such Facebook only serves advertisements that exist in Microsoft's advertisement inventory.
| Year | Revenue | Growth |
|---|---|---|
| 2006 | $52[53] | — |
| 2007 | $150[54] | 188% |
| 2008 | $280[55] | 87% |
| 2009 | $775[56] | 177% |
| 2010 | $2,000[2] | 158% |
Facebook generally has a lower clickthrough rate (CTR) for advertisements than most major websites. Banner advertisements on Facebook have generally received one-fifth the number of clicks compared to those on the Web as a whole.[57] This means that a smaller percentage of Facebook's users click on advertisements than many other large websites. For example, while Google users click on the first advertisement for search results an average of 8% of the time (80,000 clicks for every one million searches),[58] Facebook's users click on advertisements an average of 0.04% of the time (400 clicks for every one million pages).[59]
Sarah Smith, who was Facebook's Online Sales Operations Manager, confirmed that successfuladvertising campaigns can have clickthrough rates as low as 0.05% to 0.04%, and that CTR for ads tend to fall within two weeks.[60] Competing social network MySpace's CTR, in comparison, is about 0.1%, 2.5 times better than Facebook's but still low compared to many other websites. Explanations for Facebook's low CTR include the fact that Facebook's users are more technologically savvy and therefore use ad blocking software to hide advertisements, that users are younger and therefore are better at ignoring advertising messages, and that MySpace users spend more time browsing through content, while Facebook users spend their time communicating with friends and therefore have their attention diverted away from advertisements.[61]
On pages for brands and products, however, some companies have reported CTR as high as 6.49% for Wall posts.[62] Involver, a social marketing platform, announced in July 2008 that it managed to attain a CTR of 0.7% on Facebook (over 10 times the typical CTR for Facebook ad campaigns) for its first client, Serena Software, managing to convert 1.1 million views into 8,000 visitors to their website.[63] A study found that, for video advertisements on Facebook, over 40% of users who viewed the videos viewed the entire video, while the industry average was 25% for in-banner video ads.[64]
Mergers and acquisitions
Main article: List of acquisitions by Facebook
On November 15, 2010, Facebook announced it had acquired FB.com from the American Farm Bureau Federation for an undisclosed amount. On January 11, 2011, the Farm Bureau disclosed 8.5 million in "domain sales income", making the acquisition of FB.com one of the ten highest domain sales in history.[65]
Operations
A custom-built data center with substantially reduced ("38% less") power consumption compared to existing Facebook data centers opened in April 2011 in Prineville, Oregon.[66]
Website
Main articles: Facebook features and Facebook Platform
Users can create profiles with photos, lists of personal interests, contact information, and other personal information. Users can communicate with friends and other users through private or public messages and a chat feature. They can also create and join interest groups and "like pages" (formerly called "fan pages", until April 19, 2010), some of which are maintained by organizations as a means of advertising.[67]
To allay concerns about privacy, Facebook enables users to choose their own privacy settings and choose who can see specific parts of their profile.[68] The website is free to users, and generates revenue from advertising, such as banner ads.[69] Facebook requires a user's name and profile picture (if applicable) to be accessible by everyone. Users can control who sees other information they have shared, as well as who can find them in searches, through their privacy settings.[70]
The media often compare Facebook to MySpace, but one significant difference between the two websites is the level of customization.[71] Another difference is Facebook's requirement that users give their true identity, a demand that MySpace does not make.[72]MySpace allows users to decorate their profiles usingHTML and Cascading Style Sheets (CSS), while Facebook only allows plain text.[73] Facebook has a number of features with which users may interact. They include the Wall, a space on every user's profile page that allows friends to post messages for the user to see;[74] Pokes, which allows users to send a virtual "poke" to each other (a notification then tells a user that they have been poked);[75] Photos, where users can upload albums and photos;[76] and Status, which allows users to inform their friends of their whereabouts and actions.[77] Depending on privacy settings, anyone who can see a user's profile can also view that user's Wall. In July 2007, Facebook began allowing users to post attachments to the Wall, whereas the Wall was previously limited to textual content only.[74]
On September 6, 2006, a News Feed was announced, which appears on every user's homepage and highlights information including profile changes, upcoming events, and birthdays of the user's friends.[78] This enabled spammers and other users to manipulate these features by creating illegitimate events or posting fake birthdays to attract attention to their profile or cause.[79] Initially, the News Feed caused dissatisfaction among Facebook users; some complained it was too cluttered and full of undesired information, while others were concerned it made it too easy for others to track individual activities (such as relationship status changes, events, and conversations with other users).[80]
In response, Zuckerberg issued an apology for the site's failure to include appropriate customizable privacy features. Since then, users have been able to control what types of information are shared automatically with friends. Users are now able to prevent user-set categories of friends from seeing updates about certain types of activities, including profile changes, Wall posts, and newly added friends.[81]
On February 23, 2010, Facebook was granted a patent[82] on certain aspects of its News Feed. The patent covers News Feeds in which links are provided so that one user can participate in the same activity of another user.[83] The patent may encourage Facebook to pursue action against websites that violate its patent, which may potentially include websites such as Twitter.[84]
One of the most popular applications on Facebook is the Photos application, where users can upload albums and photos.[85] Facebook allows users to upload an unlimited number of photos, compared with other image hosting services such as Photobucket and Flickr, which apply limits to the number of photos that a user is allowed to upload. During the first years, Facebook users were limited to 60 photos per album. As of May 2009, this limit has been increased to 200 photos per album.[86][87][88][89]
Privacy settings can be set for individual albums, limiting the groups of users that can see an album. For example, the privacy of an album can be set so that only the user's friends can see the album, while the privacy of another album can be set so that all Facebook users can see it. Another feature of the Photos application is the ability to "tag," or label, users in a photo. For instance, if a photo contains a user's friend, then the user can tag the friend in the photo. This sends a notification to the friend that they have been tagged, and provides them a link to see the photo.[90]
Facebook Notes was introduced on August 22, 2006, a blogging feature that allowed tags and embeddable images. Users were later able to import blogs from Xanga,LiveJournal, Blogger, and other blogging services.[36] During the week of April 7, 2008, Facebook released a Comet-based[91] instant messaging application called "Chat" to several networks,[92] which allows users to communicate with friends and is similar in functionality to desktop-basedinstant messengers.
Facebook launched Gifts on February 8, 2007, which allows users to send virtual gifts to their friends that appear on the recipient's profile. Gifts cost $1.00 each to purchase, and a personalized message can be attached to each gift.[93][94] On May 14, 2007, Facebook launchedMarketplace, which lets users post free classified ads.[95]Marketplace has been compared to Craigslist by CNET, which points out that the major difference between the two is that listings posted by a user on Marketplace are seen only by users in the same network as that user, whereas listings posted on Craigslist can be seen by anyone.[96]
On July 20, 2008, Facebook introduced "Facebook Beta", a significant redesign of its user interface on selected networks. The Mini-Feed and Wall were consolidated, profiles were separated into tabbed sections, and an effort was made to create a "cleaner" look.[97] After initially giving users a choice to switch, Facebook began migrating all users to the new version beginning in September 2008.[98] On December 11, 2008, it was announced that Facebook was testing a simpler signup process.[99]
On June 13, 2009, Facebook introduced a "Usernames" feature, whereby pages can be linked with simpler URLs such as
http://www.facebook.com/facebook as opposed tohttp://www.facebook.com/profile.php?id=20531316728.[100] Many new smartphonesoffer access to the Facebook services either through their web-browsers or applications. An official Facebook application is available for the iPhone OS, the Android OS, and the WebOS. Nokia andResearch In Motion both provide Facebook applications for their own mobile devices. More than 150 million active users access Facebook through mobile devices across 200 mobile operators in 60 countries.On November 15, 2010, Facebook announced a new "Facebook Messages" service. In a media event that day, CEO Mark Zuckerberg said, "It's true that people will be able to have an @facebook.com email addresses, but it's not email." The launch of such a feature had been anticipated for some time before the announcement, with some calling it a "Gmail killer." The system, to be available to all of the website's users, combines text messaging, instant messaging, emails, and regular messages, and will include privacy settings similar to those of other Facebook services. Codenamed "Project Titan," Facebook Messages took 15 months to develop.[101][102]
In February 2011, Facebook began to use the hCalendar microformat to mark up events, and thehCard microformat for the events' venues, enabling the extraction of details to users' own calendar or mapping applications.[103]
As of April 2011 Facebook users now have the ability to make live voice calls via Facebook Chat allowing users to chat with others from all over the world. This feature which is provided free through T-Mobile's new Bobsled service lets the user add voice to the current Facebook Chat as well as leave voice messages on Facebook.[104]
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