Gov Brown Call Your Office — Facebook is in the Tank
08/02/2012 2 Comments
Right after the Facebook IPO I blogged using a title similar to the above on my post and was told by his Purpleness that I just did not understand. Now the Legislative Analyst’s Office sees the same pitfall that I did with Facebook sliding into the tank. Gov Brown had assumed that the IPO would produce millions of tax revenue for his budget. Does not look like that will happen.
The Sac Bee has the story HERE.
The state’s Legislative Analyst’s Office said Wednesday that “hundreds of millions” of dollars in assumed tax revenues may never materialize due to the continued slide in Facebook’s stock price.
The Analyst’s Office said today that much of the Facebook income tax revenues will still come in. But the LAO added that “if the company’s stock price remains depressed, hundreds of millions of income tax dollars assumed in the 2012-13 state budget plan are at risk.”
The stock is down below $20 today and three top executive were fired today, after admitting that Facebook has 83 million fake accounts.
I just could not see how Facebook was going to make any money, especially with more people abandoning their desk top and lap tops for smartphones. A study by the World Bank and infoDev titled “Information and Communications for Development 2012” found that an estimated three-quarters of the world’s people have access to a mobile device. The number of worldwide mobile subscriptions grew from less than 1 billion in 2000 to over 6 billion today, the study said. Globally about 30% of all those phones are smartphones. In the US 46% of all cellphones are smartphones.
With more and more Facebook users relying on smartphones there is not enough ad space on the screen without annoying the user. Facebook revealed it had 955 million monthly active users and 543 million monthly active mobile users. In the social-networking giant’s 10-Q filing published last night, the company disclosed that nearly 20 percent of the latter number, 102 million users, accessed the social network in June solely from their mobile device. More at CNET.com
The use of smartphones as the prime computing device is projected to grow. As it grows, Facebook’s revenue problems become more tenable. It appears investors are coming to the same conclusion. Wonder what his Purpleness’ thinks?