facebook

Facebook (formerly [thefacebook]) is an online social networking service headquartered in Menlo Park, California. Its website was launched on February 4, 2004, by Mark Zuckerberg with his college roommates and fellow Harvard University students Eduardo Saverin, Andrew McCollum, Dustin Moskovitz and Chris Hughes.[7] The founders had initially limited the website's membership to Harvard students, but later expanded it to colleges in the Boston area, the Ivy League, and Stanford University. It gradually added support for students at various other universities and later to high-school students. Facebook now allows anyone who claims to be at least 13 years old to become a registered user of the website.[8] Its name comes from a colloquialism for the directory given to it by American universities students.[9]

After registering to use the site, users can create a user profile, add other users as "friends", exchange messages, post status updates and photos, share videos and receive notifications when others update their profiles. Additionally, users may join common-interest user groups, organized by workplace, school or college, or other characteristics, and categorize their friends into lists such as "People From Work" or "Close Friends". Facebook had over 1.3 billion active users as of June 2014.[2] Due to the large volume of data collected about users, the service's privacy policies have faced scrutiny, among other criticisms. Facebook, Inc. held its initial public offering in February 2012 and began selling stock to the public three months later, reaching a peak market capitalization of $104 billion

In late 2007, Facebook had 100,000 business pages (pages which allowed companies to promote themselves and attract customers). These started as group pages, but a new concept called company pages was planned.[34] Pages began rolling out for businesses in May 2009.[35]

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.[36] Microsoft's purchase included rights to place international adverts on the social networking site.[37]

In October 2008, Facebook announced that it would set up its international headquarters in Dublin, Ireland.[38] Almost a year later, in September 2009, Facebook said that it had turned cash-flow positive for the first time.

Facebook eventually filed for an initial public offering on February 1, 2012.[48] Facebook held an initial public offering on May 17, 2012, negotiating a share price of US$38. The company was valued at $104 billion, the largest valuation to date for a newly listed public company.[49][50][51]

Facebook Inc. began selling stock to the public and trading on the NASDAQ on May 18, 2012.[52] Based on its 2012 income of $5 billion, Facebook joined the Fortune 500 list for the first time in May 2013, ranked in position 462.[53]

Corporate affairs

Management

The ownership percentages of the company, as of 2012, are:

• Mark Zuckerberg: 28%,[101]
• Accel Partners: 10%
• Mail.Ru Group: 10%[102]
• Dustin Moskovitz: 6%
• Eduardo Saverin: 5%
• Sean Parker: 4%
• Peter Thiel: 3%
• Greylock Partners: between 1 to 2%
• Meritech Capital Partners: between 1 to 2% each
• Microsoft: 1.3%
• Li Ka-shing: 0.8%
• Interpublic Group: 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. The remaining 30% or so are owned by employees, an undisclosed number of celebrities, and outside investors.[103] Adam D'Angelo, former 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.[104]

  Key management personnel consist of: Chris Cox (Chief Product Officer), Sandberg (COO), and Zuckerberg (Chairman and CEO). As of April 2011, Facebook has over 7,000 employees, and offices in 15 countries.[105] Other managers include chief financial officer David Wehner and public relations head Elliot Schrage.[106]

  Facebook was named the 5th best company to work for in 2014 by company-review site Glassdoor as part of its sixth annual Employees' Choice Awards. The website stated that 93% of Facebook employees would recommend the company to a friend.[107]

Most of Facebook's revenue comes from advertising.[115][116] Facebook generally has a lower clickthrough rate (CTR) for advertisements than most major Web sites. According to BusinessWeek.com, banner advertisements on Facebook have generally received one-fifth the number of clicks compared to those on the Web as a whole,[117] although specific comparisons can reveal a much larger disparity. 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),[118] Facebook's users click on advertisements an average of 0.04% of the time (400 clicks for every one million pages).[119]

Sarah Smith, who was Facebook's Online Sales Operations Manager until 2012,[120] reported that successful advertising campaigns on the site can have clickthrough rates as low as 0.05% to 0.04%, and that CTR for ads tend to fall within two weeks.[121]

The cause of Facebook's low CTR has been attributed to younger users enabling ad blocking software and their adeptness at ignoring advertising messages, as well as the site's primary purpose being social communication rather than content viewing.[122] According to digital consultancy iStrategy Labs in mid-January 2014, three million fewer users aged between 13 and 17 years were present on Facebook's Social Advertising platform compared to 2011.[123] However, Time Writer and Reporter Christopher Matthews stated in the wake of the iStrategy Labs results: