Facebook notches up new user milestones with such regularity it’s easy to forget how fast its business potential is growing.
A year ago, when board member Marc Andreessen came out and predicted the service would reach 1bn users, it sounded like hype. Not so now, with the half-billion figure reached on Wednesday and 1bn widely seen as all but inevitable.
If Facebook’s revenues really are running at the rumoured $1bn a year (and from what we can tell, that number isn’t far off), that means it’s making $2 a year off the average user.
Consider how that compares to other internet companies – and bear in mind that unlike others, Facebook actually has an account relationship with all 500m.
Based on global user numbers from ComScore and Wall Street revenue estimates, this is roughly how much revenue other internet companies will generate per user this year (user numbers in brackets):
Google – $22.50 (932m users)
Microsoft – $2.65 (789m)
Yahoo – $7.65 (622m)
Where will Facebook eventually fall in that spectrum?
There may never be another money machine like Google’s AdWords system. But the ability to target ads based on what it knows about its users highlights the huge potential, even if it can’t match Yahoo’s premium online advertising experience. On top of that, new services like handling payments – for which it takes a 30 per cent cut – could turn into massive businesses in their own right.
There’s plenty that could go wrong. But with each new 100m, you can hear the cash register ringing.
